The Government’s Consent-Based Tax Trap

The Government’s Consent-Based Tax Trap: Understanding Statutory Definitions

Income Tax Only Applies to Federal Employees

IRS can only collect taxes from people engaged in federal activities. Most Americans unknowingly signed contracts putting them into federal employment status using definitions excluding most private Americans.​

IRS only goes after people already in their system—people who’ve consented to be there.​

Government Can Only Regulate What It Creates

Fundamental truth: Government can only tax and regulate what it creates. Since government didn’t create you, they created artificial legal persons and trick you into volunteering to represent them.​

Supreme Court confirmed: “Government may tax only what government created—corporations and paper fiat currency”. Entire tax code applies to “persons”—not people. “Persons” under federal law are artificial entities, not living human beings.​

The W-4: Your Federal Employment Application

When you signed W-4, you applied to become federal “employee” under 26 U.S.C. § 3401(c).​

Upper left corner says “Employee’s Withholding Allowance Certificate”. Regulations at 26 C.F.R. § 31.3401(c)-1 define “employee” as “officer, and individual appointed in civil service by President, Congress, or by authority of federal law”. Most private sector workers don’t fit definition.​

Title 5 U.S.C. § 2105 defines all federal employees as “officers” who must be appointed by President, Congress, or other federal authority.​

If you work at McDonald’s, Walmart, any private company, you’re not “employee” under federal tax law. You’re private worker earning private compensation not qualifying as statutory “wages”.​

Once you sign W-4, you’ve made “election”—elected to be treated as federal employee for tax purposes. Private employer becomes withholding agent for federal government.​

Regulations call W-4 “voluntary withholding agreement” in 26 C.F.R. § 31.3402(p)-1. Word “voluntary” right there in black and white.​

“Employer” – The Government Agency Definition

Under 26 U.S.C. § 3401(d), “employer” means “person for whom individual performs service as employee”. But “employee” only means federal officers.​

“Employer” under tax code only means someone who has statutory “employees”—federal officers working for government agencies or federal instrumentalities. Private sector boss isn’t “employer” in statutory sense.​

Private employers have no legal obligation to withhold federal income taxes from private workers. They only withhold because you voluntarily signed W-4.​

Your Federal Personnel ID Number

Social Security Number isn’t “yours”—back of card says “Property of Social Security Administration. Must be returned upon request”. You’re custodian of government property.​

Under 5 U.S.C. § 552a(a)(13), everyone with SSN becomes “federal personnel”. Includes anyone “entitled to receive immediate or deferred retirement benefits under any retirement program of Government of United States”.​

When you got SSN, you elected yourself into federal employment status. Became what law calls “public officer” managing government property—your own labor and earnings.​

SSA creates entity with name spelled in all capital letters, along with account number. Card doesn’t belong to you—you hold it for them until they want it back. When you sign card, you agree to act as fiduciary for card’s actual owner—federal government.​

“Wages” – Payment for Federal Services Only

Under 26 U.S.C. § 3401(a), “wages” means all remuneration for services performed by employee for employer. But “employee” only means federal officers and “employer” only means government agencies.​

“Wages” under federal law means compensation paid to federal employees for federal employment services. Your paycheck from private employment isn’t “wages” unless you voluntarily elect to treat it as such by signing W-4.​

26 C.F.R. § 31.3401(a)-3 says amounts only become “wages” when there’s “voluntary withholding agreement in effect under section 3402(p)”. That’s your W-4—voluntary agreement.​

Employer can legally pay you without withholding anything if you don’t sign W-4. Only required to withhold from statutory “wages” paid to statutory “employees”.​

“Trade or Business” – The Public Office Connection

IRC defines “trade or business” in 26 U.S.C. § 7701(a)(26) as “performance of functions of public office”. Not private business—public office.​

Only people engaged in “trade or business” can have taxable income under code. Regulations at 26 C.F.R. § 1.1-1(a)(2)(ii) and 26 C.F.R. § 1.861-8(f)(1)(iv) make crystal clear—only aliens with income “effectively connected with trade or business” have taxable income.​

When you file tax return showing income from private job, you’re claiming private labor constitutes “performance of functions of public office”. Saying you’re federal employee managing federal property.​

Flint v. Stone Tracy Co. confirmed federal government can only tax “carrying on of occupation” involving “exercise of franchise or privilege”. Private occupations don’t qualify unless you volunteer into federal franchise.​

“Taxpayer” – The Federal Job Classification

Under 26 U.S.C. § 7701(a)(14), “taxpayer” means “any person subject to any internal revenue tax”. Under 26 U.S.C. § 1313(b), “taxpayer” specifically means someone liable for tax under Subtitle A—which only applies to people engaged in “trade or business”.​

“Taxpayer” is job classification within federal government. Not general term for anyone who might owe money. If you’re not public officer engaged in federal activities, you’re not “taxpayer” under IRC.​

Code talks about “nontaxpayers” in several places. Americans who don’t fit statutory definitions and aren’t subject to income tax.​

“United States” – Federal Territory Only

Under 26 U.S.C. § 7701(a)(9), “United States” in geographical sense means “only States and District of Columbia”. But 26 U.S.C. § 7701(a)(10) defines these “States” as federal territories under Title 48—not 50 Union states.​

Federal tax code only applies within federal territories like Washington D.C., Puerto Rico, military bases. Doesn’t apply within 50 Union states unless you elect yourself into federal jurisdiction by claiming federal franchise.​

Your legal domicile determines which laws apply to you. You can live in geographical Texas but be legally domiciled in federal “State of Texas” by participating in federal franchises like Social Security.​

Valmonte v. I.N.S. held within Constitution, term “United States” refers only to federated states consisting of federal territory, not 50 Union states.​

“Individual” and “Person” Definitions

Under 26 C.F.R. § 1.1441-1(c)(3), “individual” means “alien individual who is not citizen or national of United States”. Regulations don’t include American citizens in definition—only aliens.​

Under 26 U.S.C. § 7701(a)(1), “person” includes “individual, trust, estate, partnership, association, company or corporation”. But “individual” only means aliens, and corporations are government creations. Private American citizens aren’t “persons” under federal tax law unless they volunteer.​

Entire tax code applies to “persons”—not people. If you’re not statutory “person,” code doesn’t apply to you.​

Creating False Evidence Through Information Returns

Information returns are documents third parties file with IRS claiming you received money or engaged in federal activities. Create “prima facie evidence”—presumed true unless you prove otherwise.​

Common information returns: W-2s (filed by employers), 1099s (businesses that paid you), 1042-S (foreign persons), 1098s (mortgage interest).​

Employer files W-2 reporting private earnings as “wages” subject to federal income tax. But “wages” only means payments to federal employees for federal employment services. If you’re working at private company, W-2 may be creating false evidence about legal status.​

These information returns become foundation for IRS enforcement actions. IRS uses them as “evidence” you owe taxes, even though forms themselves may be completely false when applied to private Americans doing private work.​

26 U.S.C. § 7434 makes it crime to file false information returns, but IRS rarely enforces this against businesses filing incorrectly.​

The Franchise System: The “Roach Trap”

You get benefits (Social Security retirement, Medicare coverage, tax deductions), but benefits come with strings attached.​

Once you accept benefits, you become subject to federal jurisdiction as “public officer” or federal instrumentality. Formerly private property gets connected to public office, making it subject to federal taxation and control.​

Massachusetts v. United States said federal government can require “fair approximation of each beneficiary’s share of cost” from people receiving federal benefits.​

System makes you complicit in your own enslavement. You voluntarily sign forms using definitions you don’t understand. You voluntarily apply for numbers. You voluntarily file returns.​

Main method government uses to lawfully take property, labor, earnings is by procuring your consent through fraud using vague or ambiguous words of art on government forms.​

How the Consent System Works

ONLY way man’s property, labor, fruits from labor can be taken WITHOUT consent is if he abuses it to hurt others. Example: when you murder someone, government can take liberty by putting you in jail.​

In all other cases, government needs your consent. They get this through franchises—contracts providing benefits in exchange for your submission to their jurisdiction.​

Once you’ve consented by accepting franchise (Social Security, filing tax returns, using federal banking system), you’ve elected yourself into public office and become subject to rules governing public officers.​

Legal maxim: “He who consents cannot receive injury”. Once you voluntarily agree to participate in federal system, you can’t later claim they’re harming you by enforcing rules you agreed to.​

Problem is: Your consent was obtained through fraud—by hiding true legal definitions of terms you were agreeing to.​

The Corporate Government Connection

Under 28 U.S.C. § 3002(15)(A), “United States” means “federal corporation”. Corporation created when original constitutional government went bankrupt and was reorganized under corporate law.