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Overt Lawlessness: A Good Sign

(originally launched into cyberspace on 08/29/2007)

Dear Subscriber,

Sometimes I wonder why the IRS still bothers to pretend that what
it does is administering the law. Off hand, I can't think of ANY
law or procedure which I HAVEN'T seen the IRS blatantly ignore.
Here are just a few of the things the IRS has done wrong, just in
the cases I'm personally familiar with (and this is just off the
top of my head):

Failure to give Examinations meeting (26 CFR 601.105)
Failure to give Appeals meeting (26 CFR 601.106)
Failure to give Collections Due Process hearing (26 USC 6330)
Refusal to allow recording of meetings (26 USC 7521) (Even the Tax
Court chastised them for that one.)
Demands for sums known to be grossly inaccurate (aside from the
question of what income is taxable) (26 USC 7214)
Repeated use of the outlawed "tax protestor" term (Section 3707,
RRA 1998) (Even TIGTA reports that this is still happening every
Failure to comply with Freedom Of Information Act (5 USC 552)
Making assessments not conforming to the law (26 USC 6203)
Executing levies without giving notice (26 USC 6331)
Outright refusal to process claims for refund (26 CFR 601.105)

The list goes on and on. Take, for example, a few of the things
done by the IRS bureaucrat currently on my case (Mr. Ted
Tsarouchis). For those who don't know, in order to avoid extra
YEARS of imprisonment, Tessa and I filed back returns prior to my
sentencing, falsely reporting our income as if it were taxable
(when we know it isn't). Having paid off most of the hefty alleged
liabilities (by mortgaging our house to the max), I then applied
for an "installment agreement" with the IRS to pay off the rest.

Agent Tsarouchis responded by demanding payment in full, failing to
inform me (as instructed in IRS procedures) that if I paid down the
balance to below $25,000, I would qualify for a "streamlined"
installment agreement. After I found that out myself and paid the
balance down below $25,000, Agent Tsarouchis then refused my offer
for a "streamlined" agreement, saying he thought I could pay the
whole thing. This was AFTER I quoted to him the IRM saying that for
"streamlined" agreements, it doesn't MATTER if the IRS thinks the
person can pay off the whole thing (IRM, Section

Then he again demanded payment in full, and failed to tell me about
GUARANTEED installment agreements. I found out myself that when a
liability, NOT including interest and penalties, is below $10,000,
the IRS is required by law to grant an installment agreement if it
meets certain criteria (IRM, § In our case, the
(alleged) principle had long since been paid off completely, which
the agent well knew, yet the IRS not only didn't tell me about such
guaranteed installment agreements, but DENIED my proposed
agreement, even when the law specifically and clearly required them
to grant it, and they knew it. (During all of this, the amount they
alleged I owed would wildly fluctuate by thousands of dollars,
without any hint as to the reason.)

Finally, after rubbing their faces in the law over and over again,
they granted what 26 USC § 6159 said they HAD to grant me in the
first place. So now they get $600 a month from me--which is less
than a third of my original (probably overly-ambitious) offer to

Bizarrely, with the installment agreement in place, the IRS then
sent Tessa a letter, saying they had never received a return for
2003, and demanding around $40,000. So we sent them the IRS' own
letter, showing that an installment agreement was already in place
for that year, which of course meant they DID have those returns.
Nope, they ignored our letter, and went ahead and filed a Notice of
Deficiency, double-billing Tessa for what we paid off a year ago.
Fortunately, at this point I think that one is almost resolved

In all of this, had I not known where to look, or had I not gone to
the trouble of finding out what THEIR rules say, what would have
happened? I would have been illegally extorted and robbed. And even
when I did demonstrate that they were blatantly violating the law,
to the point where they finally caved (after months of
stonewalling), what will happen to the IRS folk who ignored the law
in the first place? Absolutely nothing.

In fact, in the cases I'm familiar with, I have NEVER heard of any
IRS agent being punished, or even reprimanded, for refusing to obey
the law. As an IRS whistle-blower explained at congressional
hearings, IRS management knows of, allows, and even CONDONES
illegal actions by IRS agents. In fact, in October of 2004, the
mainstream press broke the story that the IRS wasn't even firing
IRS employees who were failing to file their own tax returns,
though the law (Section 1203, RRA 1998) REQUIRES such firings.

Sorry for the long-winded complaint, but there is a point to all
this (other than me whining about the IRS' behavior). The law
DOESN'T MATTER to these people. And it doesn't matter to Congress
or the courts, either. They pretend to care what the law says, just
enough to keep up the facade that their extortion tactics are in
some way legitimate. But that facade is getting more and more

As a result, efforts to find some magic words or some fancy
procedure which will suddenly make the IRS be nice are a waste of
time. If a person here and there finds a way to avoid being
extorted, that's great. But those in power don't even care about
the most basic laws and rules--they violate them constantly--so
what reason is there to think that there could EVER be a reliable
"procedural" solution? There isn't a procedural solution to the IRS
any more than there is a procedural solution to the Mafia or a car-

I still occasionally get comments from people rebuking me for
expecting the "system" to do the right thing in my case. For the
umpteenth time, I have NEVER expect the system to do the right
thing, and I was saying that long before I ever went to trial. I
did, however, have some small hope that a jury of "regular"
Americans might do the right thing. In some cases they have--e.g.,
Tommy Cryer, Joe Banister, Vernice Kuglin--in others they didn't.
My goal was, and is, quite simple: I will do things the right way,
the government will lie and cheat, and whether I win or lose, I
will publicize their behavior.

The number of ways in which "the system" lied and cheated in my
case could fill a book--and in fact, it DID fill a book, which is
now in the editing stage. But, as always, my goal is NOT to give
advice on how to combat the system, nor is it to complain about
what they did to me--it is to make public how these people behave,
and what they are, for all the world to see.

Oddly, the blatant lawlessness of the IRS may, in a twisted way, be
a good sign. History shows that people don't usually fight back
against government misconduct until it's really dang obvious.
Furthermore, it is a sign of panic and desperation when a
"government" starts being openly fascist, and "forgets" to keep up
the show of due process, justice, rule of law, etc. For a lot of
people, the true nature of the IRS--as extortionistic terrorists,
rather than "tax collectors"--is becoming more and more obvious.
And public opinion and education is still a very potent weapon, and
one which those in power are scared to death of. So don't stop
telling the truth.


Larken Rose


(originally launched into cyberspace on 08/25/2007)

Dear Subscriber,

Some people seem to prefer spending their lives fitting in, not
making waves, just going with the flow (even if the flow is going
downhill). Then there are the wave-makers, who step outside of the
role of complacent, silent citizen, and go against the flow, in the
hopes of making the world a better place.

As many of you have no doubt heard by now, yesterday we lost a
great wave-maker, Aaron Russo. But though he has passed away, the
waves he made continue to spread. If any of you don't already know
about his documentary, "America: Freedom to Fascism" (which would
surprise me), here is the web site:

Others knew Aaron a lot better than I did, so they'd do a better
job of giving honors to Aaron Russo, the man. For this message, I
want to honor Aaron Russo, the wave-maker. May those waves keep on
going forever.


Larken Rose

Too Weird

(originally launched into cyberspace on 08/23/2007)

Dear Subscriber,

There isn't a particular point to this message, except to share a
story which appeared in an online CPA publication, which is too
weird not to mention. The story begins:

- -------------------------------------------

8 Million File Unnecessary Tax Returns

Washington, D.C. (Aug. 23, 2007) - More than 8 million people file
tax returns each year who don’t need to do so, imposing heavy costs
on the Internal Revenue Service, according to a new report from a
Treasury Department watchdog.

The Treasury Inspector General for Tax Administration looked at the
steps the IRS has been taking to reduce the number of tax returns
filed by individuals whose wages are too low to meet the filing
threshold. TIGTA found that taxpayers collectively spent an average
of $390 million and 75 million hours per year preparing and filing
unnecessary tax returns. The IRS, for its part, spent an average of
$11 million each year to process the unnecessary returns. ...

- ----------------------------------

For some strange reason, I find myself unable to muster much
sympathy for the IRS' problem. (Incidentally, they missed the
correct number of non-required returns by about 100 million--but we
are talking about government here, so that should come as no


Larken Rose

Comments On Cryer

(originally launched into cyberspace on 08/22/2007)

Dear Subscriber,

I just finished reading the trial transcripts of the case of Tommy
Cryer, the Louisiana lawyer recently ACQUITTED of "willful failure
to file." I only have a few comments about it:

1) First, the judge at his trial was both extremely obnoxious and
an idiot. (Well, maybe he was intentionally lying instead, but I'll
give him the benefit of the doubt that he was merely an idiot.)
Aside from being excessively rude and condescending towards Larry
Becraft, Mr. Cryer's attorney, as Mr. Cryer was testifying about
his beliefs, the judge kept completely mischaracterizing them as
beliefs that the tax laws are invalid or unconstitutional, which
anyone paying attention could see that Mr. Cryer was NOT at all

2) The prosecutor, though at first he came across (just from the
transcripts) as less of a @#$@$% than the ones in my case, either
tried to confuse the jury about the difference between
"disagreeing" with the law and believing you don't owe--or he
actually didn't understand the difference himself. Under the
concept of "willfulness," if you believe that the law doesn't tax
your income, you CAN'T be guilty of "willfulness," even if you're
dead wrong (i.e., even if your conclusions conflict with, or
"disagree" with the law itself). However, if you believe you DO owe
the tax, but you think the law is unconstitutional, unfair, etc.--
in other words, if you "disagree" with the tax ON PRINCIPLE--then
that is NOT a defense to "willfulness." Mr. Cryer was obviously
doing the former, but the prosecutor kept trying to paint that as a
"disagreement" with the law, which is NOT what the Supreme Court
meant by that when they said it in the Cheek decision.

3) When I finished reading the government's case (having not yet
read the defense case), I was completely stunned. Their entire case
consisted of proving that Mr. Cryer had made money, and hadn't
filed--which weren't even in question. The only thing that was even
remotely relevant to the essential element of "willfulness" was one
CID goon saying that Mr. Cryer's arguments were "frivolous"--which
is a little odd, because Mr. Cryer hadn't ARGUED anything at that
point. The fact that the government can be so horribly sloppy,
resorting only to envy and demonization, instead of even bothering
to try to prove that a crime was actually committed, not only
reflects badly on the "government" drones, but also on the American
people. Have we become so stupid that, in order to get a jury to
convict, all you have to do is say, "He's a meanie poopoohead, who
didn't do what he was told!"? Unfortunately, yes: most of "us" are
that stupid, as demonstrated by my trial, Dr. Tom's trial, and
Tessa's trial (among others). Thankfully, by some stroke of luck,
someone with a brain must have ended up on Mr. Cryer's jury, and
ended that particular witch-hunt.

4) To me, the funniest moment was when Mr. Cryer's secretary,
testifying as a witness for the government, blurted out something
like, "After Mr. Cryer learned that we are not liable for this
tax..." Of course, the government objected. But then the prosecutor
used the secretary's decision to continue to file herself as if it
proved that she didn't believe Mr. Cryer's conclusions, after
having STOPPED the defense from pointing out that maybe she kept
filing because she didn't want to be terrorized and prosecuted by
the feds. But what kind of goofy logic would that be anyway??:
"You, as a very accomplished, experienced, well-respected lawyer,
CAN'T have thought your conclusions were correct, because your
SECRETARY didn't agree with them (allegedly)." Huh? Anyway, the
government's non-existent case failed to dupe the jury, and that's
all that matters.


Larken Rose

(P.S. Though the 861 evidence came up briefly at trial, as one of
the things which convinced Mr. Cryer that he didn't owe the tax,
there were other issues as well, some of which I disagree with.
Unlike the federal fascists, however, I don't want people put in
cages because they disagree with me. I am thrilled that Mr. Cryer
remains a free man... or rather, as "free" as one can be in this
country at present.)

Bloody Knives

(originally launched into cyberspace on 08/12/2007)

Dear Subscriber,

One night you're walking through the city, when from an alley you
hear screams of agony. At first it's too dark to see, but then a
man comes running into view, a bloody butcher's knife clutched in
his hand. Seeing your expression, he hesitates, then says, "Oh,
don't worry, that was just my girlfriend; she stubbed her toe." So
you go on about your business, putting the incident out of your
mind, forgetting it ever happened. The end.


Just about anyone with a brain, after reading the above story,
would immediately think, "But what about the bloody knife??" A
stubbed toe doesn't explain the bloody knife. But hey, the guy TOLD
you that's all it was, so who are you to keep asking frivolous
questions about what happened?

And so it is with the "income tax" deception, and the 861 evidence.
There are piles of proverbial "bloody knives" lying around, which
the feds have never even TRIED to explain. But they TOLD you we all
owe the tax, and just for good measure, they persecuted, robbed,
imprisoned, and/or silenced the people who suggested otherwise.
Isn't that enough? You don't STILL want explanations for all those
bloody knives, do you? Just mind your own damn business, and forget
you ever saw them.

Here are some of the "bloody knives" which have been made public
for anyone who wants to see them, but which, as far as I know, the
feds have never even TRIED to explain:

1) Many decades of income tax regulations very specifically said
that, in addition to those types of income specifically exempted
from tax by the tax code, some OTHER income is also tax-free
because of the Constitution itself.

Like what? For a moment, never mind what I think the answer is, or
what you think the answer is. THOUSANDS of Americans have asked the
IRS the question, and I have yet to see ANY answer, or even any
MENTION of the question or the regulations which say that, coming
from anyone in government, in any of the three branches. SOMETHING
is Constitutionally excluded--their own law books say so in plain
English. And yet I have NEVER seen them say a word about that. They
just leave that "bloody knife" sitting there in plain view, with
nary a WORD about it, hoping you'll forget you ever saw it.

2) After saying that the "items" of income listed in Section 61 are
sometimes exempt, the current regulations give a list of types of
income which are NOT exempt--i.e., which ARE taxable. The list,
which you can go look up yourself (1.861-8T(d)(2)(iii)), includes
four types of international trade. No mention is made of the
domestic income of the average American.

What's the purpose of that list? And why isn't OUR income on the
list, if we actually owe the tax? Once again, set aside any answer
you and I might suggest; why has no one in any of the three
branches of government ever given any answer or explanation of
that, or even MENTIONED that particular regulation? Another
unexplained "bloody knife," left right out in the open.

3) In the older version of the tax codes, there was a section which
very plainly stated that in the case of FOREIGNERS, and in the case
of Americans with POSSESSIONS income, compensation for services
performed inside the U.S. (as well as other kinds of domestic
income) is, after subtracting allowable deductions, to be included
in full as TAXABLE income.

Isn't such income taxable for ALL U.S. citizens? That's obviously
what the feds want us to think. So why would there be a section
saying it's taxable in the case of foreigners and CERTAIN
Americans? I have an answer, and you might too, but I have NEVER
seen anyone in any of the three branches of government answer that
question, or discuss that section of law at all.

There are many more proverbial "bloody knives," but that will do
for now. At least as far back as 1998, thousands of Americans have
been asking about these things. They get the usual insults
("frivolous!") and threats ("you'll get in trouble!"), and even an
occasional baseless assertion or two. But many of the
"inconvenient" pieces of evidence just get ignored entirely. The
feds say NOTHING about them, acting as if they're not there, in the
hopes that we'll all forget about the pile of bloody knives on
their front doorstep. (In case you're wondering, I brought up all
three of the above-mentioned "bloody knives" at my trial, in
addition to others, and neither the prosecutors nor the judge ever
said ONE WORD about them.)

The objective, thinking scientific mind seeks to explain evidence,
rather than looking for an excuse to IGNORE it. I put together my
"Taxable Income" report in 1998, revised and updated it repeatedly,
and then recently rewrote the entire thing from scratch (whilst in
prison for the crime I didn't commit), for the benefit of anyone
who actually WANTS to see how all the evidence fits together. You
won't ever see the feds doing anything of the kind. If you're
lucky, you'll get one or two baseless assertions (e.g., "You're not
supposed to use 861!"), but you'll NEVER see them lay out all the
evidence, explaining it piece by piece, showing how all the pieces
fit together into a complete and logical picture supporting their
position (because it doesn't). In short, for eight YEARS it's been
a one-sided "debate": while we give comprehensive explanations,
with numerous supporting citations, they say "Frivolous! Shut up!"
And they hope people don't notice all the bloody knives.

Well, for anyone who's interested in learning more about the
"bloody knives," you too can now have your very own copy of my
recent updated, much-improved "Taxable Income" report, for the low,
low price of... zero dollars and zero cents (just like it's always
been). Just look for the link at the bottom of the following web
page, and download the new and improved (but still free) version of
the report (in PDF format):


Larken Rose

P.S. For those of you who haven't yet, while you're on the web site, find the orange
"Click&Pledge" button near the bottom, and make a donation to the
family of Dr. Tom Clayton, a man who has risked, and lost, a LOT in
an effort to get the public to pay attention to all the feds'
"bloody knives." If you do it now, you have my permission to ignore
any future naggings about it I may send out. Wouldn't that alone
make it worthwhile?

Trust No One

(originally launched into cyberspace on 07/18/2007)

Dear Subscriber,

I often think back to the very telling comment which Professor
Siegel made about the 861 evidence, opining about whose opinions
you should "trust." (He obviously implied that you shouldn't
"trust" me because I was convicted, but you should "trust" him and
the other status quo "experts" because of their credentials.)
However, while there are a lot of situations in life where our
actions and beliefs are, out of necessity, determined based on who
we trust, there are other times when "trust" is completely

Suppose a baseball comes through your living room window, and you
go outside and find two kids, each of whom says the other one threw
the ball. You have no first-hand evidence; all you have is the
conflicting statements of two other people. So, if you're trying to
figure out the truth, you're forced to decide who to "trust"--who
do you think lied to you and who told the truth?

Now suppose you're sitting in your living room, and looking out,
you see with your own eyes one of two kids hurl a ball at your
house, which goes through your window. When you go outside,
however, the ball-thrower kid confidently proclaims, "I'm an honors
student, I go to church every Sunday, and everyone knows I'm a nice
kid, while Fred here is a flunky trouble-maker, and he threw the
ball through your window. Now which of us are you going to trust?"
In that case, of course, "trust" is irrelevant. You saw what
happened with your own eyes; you don't need to take anyone's word
for it, so you don't need to decide who you can "trust."

The power of indoctrination, however, is so potent that a lot of
people will "trust" effective spin doctors, even when they are
saying things blatantly contrary to the person's first-hand
experiences. Some people can outright lie while looking completely
sincere. (Does the phrase, "I did not have sex with that woman"
ring a bell?) And those people often get jobs working as government
spokesmen or as media "reporters" (which are sometimes the same

Liars rarely point to evidence (because evidence is rarely on their
side); instead, they opine that they, and those who agree with
them, should be "trusted," while claiming that people with contrary
beliefs shouldn't be trusted. For example, some Tax Court judge
might proclaim the 861 evidence to be "frivolous," because he said
so. And because he's a "judge," we're all supposed to trust him.
Then another court quotes the first, and as a matter of "trust,"
concurs with the "frivolous" accusation. Then some spin doctor like
David Cay Johnston at the New York Times can report that "no court"
has agreed with the 861 evidence. Everyone on their side is basing
their argument on TRUST: who should you blindly believe? Should you
believe some uncredentialed nobody "tax protestor"/"tax fraud
scheme promoter," or the honorable, objective, highly-trained,
legal expert federal judges?

I choose NEITHER. Why do I need to "trust" anyone when the law is
publicly available? Granted, someone who is supposed to be an
expert might be (and should be) more able to point to the EVIDENCE
supporting a particular conclusion, but if he can't or won't do
that, why the heck should he be "trusted" at all? "Only we can
understand the law, so just take our word for it when we tell you
what it means." How Kafkaesque. And how stupid.

In contrast, my "Taxable Income" report, my video, etc., not to
mention the statements of lots and lots of other people who happen
to share my conclusions about the law (including thousands of you),
don't ask the public to "trust" anyone. Instead, we quote the law.
Yes, we explain our understanding of it too, but NEVER do we ask
people to take our word for it because of who we are (or who we
claim to be). So why does the government spend so much time
demonizing us, and so little time trying to refute the substance of
what we say?

The answer is obvious: in a contest of evidence and logic, they
lose. But in a contest of who to "trust"--who to blindly believe--
they think they can win by painting us as nasty tax cheat scammers.
And no doubt it works on the weak-minded, who wouldn't dare look at
the EVIDENCE themselves, but who instead just guess about who they
should blindly follow. I've often heard people new to issues like
this say something like, "I'm not sure who to believe." My response
is: don't BELIEVE anyone. This is not a matter of faith; it's a
matter of publicly-available evidence and logic.

Unfortunately, most people don't think that way. What they hear day
in and day out gets lodged in their brains, so deep that even
evidence and logic often can't shake it loose. They can't "believe"
that the income tax could be a giant fraud. But I'm not asking them
to "believe" anything; it is the status quo tax "experts" who are
constantly pushing the idea that us mere peasants are incapable of
understanding the law, and that we should therefore just BELIEVE
what they say about it instead of studying it for ourselves.

So let's pretend to be rational, thinking beings, and set aside the
irrelevant issues of belief, faith, and trust, and look at what the
EVIDENCE shows. Here's my challenge, not just to you, but to anyone
else (feel free to forward this message to all your neighbors,
friends and enemies): First, read the new version of my "Taxable
Income" report, which you can get for FREE from the link near the
bottom of the web site. Then, try
your darndest to find a CONTRARY opinion which actually addresses
all of the evidence and points cited in the report, and which
answers the six questions found at the end of the report. If after
a DECADE of the issue being publicly discussed by hundreds of
thousands of people, the other side STILL doesn't have a thorough,
carefully explained and fully-supported rebuttal to the 861
evidence... well, then you'll know WHY they talk about "trust" and
"belief," instead of about logic and evidence.


Larken Rose

[ August 31, 2007, 11:29 PM: Message edited by: 3rdEar ]