Withholding On The Ropes?
We The People Foundation
July 19, 2007
Withholding On The Ropes?
U.S. Unable To Prove It�??s Not Voluntary
The United States appears to have bitten off more than it can chew when it sued Bob Schulz and the We The People organizations earlier this year in an effort to shut down "Operation Stop Withholding."
In the lawsuit, the Government accused WTP of operating an unlawful "abusive tax shelter" in violation of IRC Sections 6700 and 6701, citing the organization's efforts to urge individuals to terminate their W-4 wage and salary withholding agreements.
In response to the lawsuit served on Schulz on May 3, 2007, Schulz filed a motion to have the case dismissed on the ground that Operation Stop Withholding is not only fully protected by the First Amendment (including the Petition clause), it is protected because We The People organization is educating People about the withholding laws as they are currently written and which expressly provide that such agreements are voluntary.
The Government's lawsuit has asked the District Court to issue an injunction prohibiting WTP�??s efforts to educate Americans about the legal termination of private withholding agreements. WTP's efforts rely on "black letter" law which clearly establishes that Withholding Agreements (W-4s) are voluntary and that a worker can -- at any time -- terminate his W-4 by simply notifying the company that he no longer gives his permission to the company to withhold from his pay.
The Government finds itself in a very tough spot.
On one hand, it is asking the Court to shut the WTP program down, but on the other hand, neither the IRS nor the attorneys at the Department of Justice have been able to dispute or refute the simple truth that the law itself plainly establishes that withholding is voluntary and permission to withhold can be easily withdrawn by workers at their sole discretion.
What follows are a just a few of the legal citations that the Government has been confronted with and has failed to rebut:
26 CFR § 31.3402 (p)-1 "Voluntary Withholding Agreements". (a) An employee who desires to enter into an agreement for withholding.....shall furnish his employer with Form W -4 (or equivalent) for withholding.
Read it for yourself.
Pursuant to 26 CFR § 31.3402(p)-1(b)(2), either a company or a worker may terminate the withholding agreement (or its equivalent) at any time, by furnishing a signed, written notice to the other. Read it for yourself.
Pursuant to 26 USC § 3402(p)(3)(A), 5 USC §5517 and 31 CFR §215.2(n)(1), all ordinary American workers have the right to refuse to consent to enter into a voluntary withholding agreement and can voluntarily refuse to have amounts taken from his/her pay for federal and/or state taxes, social security, other governmental insurance programs or welfare programs.
�??Protected Individuals�?� as per 8 USC §1324a cannot be compelled to submit any specific government documents or to disclose a social security number as a condition of being hired by or maintaining their status as a worker. Most American workers qualify as "Protected Individuals" under the law.
The landmark decision of EEOC v. Information Systems Consulting CA3-92-0169T U.S.D.C. Northern District of Texas Dallas Division, held that companies cannot discriminate against applicants or workers for failure to obtain or disclose a social security number.
No law requires a worker to file a Form W-4 (or its equivalent). In U.S. v. Mobil Oil Co., 82-1 USTC para. 9242, U.S.D.C. ND Tex. Dallas 1981 CA. 3-80-0438-G, the court ruled that an Entity does not even have to send a W-4 Form or other employment forms to the Internal Revenue Service unless served with a judicial court-ordered summons to do so.
Pursuant to IRC §6041(c), a worker is only required to furnish a name and address upon demand of a company for whom he seeks to work. No social security number is required by statute.
Building upon a plethora of false statements, pitiful hyperbole, factual omissions and defective (and vindictive) claims of lawful authority, the Government has attempted to paint WTP as a "promoter" of an illegal tax fraud "scheme" without ever specifically identifying any false speech made by WTP, and without addressing the very laws WTP has relied upon -- and which irrefutably establish that wage and salary withholding is voluntary.
Nowhere in its pleadings does the Government directly confront the voluntary nature of the withholding laws cited by WTP even though withholding is the central issue before the court.
Indeed, beyond the compelling judicial and constitutional drama unfolding as the landmark Right to Petition lawsuit continues its certain path to the Supreme Court, the Government may have done itself great harm by pursing a "6700" lawsuit against WTP.
As a result of accusing WTP of activity expressly protected by the Constitution and the lesser laws of the nation, it has risked widespread exposure in the public domain of the very information it seeks to censor.
It is no miracle that the United States cannot -- by any law -- force average workers to submit to mandatory withholding. To do so would be to require them to withhold monies for taxes, which by the Constitution and U.S. law, CANNOT BE IMPOSED UPON ORDINARY AMERICANS.
The fact that one's signature is required to execute a W-4 withholding agreement is simple evidence of this truth that, until recently, has remained well-obscured within the complexity of the tax code.
It is beyond time that our government confront a difficult political question that our organization has asked repeatedly over numerous years:
Do our elected leaders and guardians of the Rule of Law move with deliberation toward an orderly transition of a replacement for our Constitutionally-abusive tax system, or do they risk a chaotic, systemic collapse of the government funding mechanism (or even worse) because of the growing, yet unstoppable, awakening of the public consciousness regarding the truth about our nation's tax laws?
It is indeed not ironic that such a possibility awaits our nation, and may one day come to pass, inadvertently perhaps, because of one IRS prosecution too many.
The truth is out there and it's not going away.
Withholding On The Ropes?
