The 16th Amendment is Constitutional, but it “DOES NOT” apply to your Wage, Salary, Labor, or Tips, and never has!
Amendment 16 says: "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration". This Amendment thus places this tax under the “Indirect Tax” classification of the Constitution.
The 16th Amendment is Constitutional because it does not tax your labor, salary, wages or tips. Those are the “sources” from which any income derived (made), would be taxable under that Amendment.
There is a clear distinction in the use of the words “FROM” and “ON” in that Amendment and the high Courts have made that distinction clear. The definition of Income doesn’t really matter. What the Congress “can” tax is what matters. The 16th Amendment states that the Congress shall have power to lay and collect taxes on incomes, “FROM” whatever source derived, not “ON” whatever source derived. If the income tax was on your labor, then making labor would be income, but it’s not. Since the 16th Amendment and Title 26 (IRS Code) only tax income “FROM” your labor, you must first have labor and then derive income from that labor, like investing it in a CD, or savings account. The interest on that labor (the source), not the labor, would be income. Sounds completed but it’s not.
Here’s a perfect example. Just like a capital gains tax, the tax on a property purchased for $100,000 and sold for the same amount is zero. Why? No gain. The capital gains tax is not “ON” the property itself, it’s “FROM” the gain on the property. You see? The capital gains tax on a property purchased for $100,000 and sold for $150,000, has a capital gains tax of $50,000. No gain, no tax. So in this example the capital gains tax is just like the income tax, the tax is derived “FROM” the gain on the property, not “ON” the property itself. So the property in the above example is the same as the property, being your labor. Your labor is not taxed, any gain from your labor is subject to the taxing power of the 16th Amendment.
It doesn’t matter what meaning is given to income. What matters is that, according to the 16th Amendment itself, the income tax is laid on all incomes “FROM” the source, not “ON” the source. I have listed 5 high appellate court cases, including the United States Supreme Court, which bears me out.
Now, go try and sell this argument to the government and see how far you get. Unfortunately, “might makes right” in this case. They have the might, so we lose a right. Or, do you feel like standing up for your rights yet?
Oliver v. Halstead, 86 S.E. Rep 2nd 859 (1955):
"There is a clear distinction between `profit' and `wages', or a compensation for labor. Compensation for labor (wages) cannot be regarded as profit within the meaning of the law. The word `profit', as ordinarily used, means the gain made upon any business or investment -- a different thing altogether from the mere compensation for labor."
Lucas v. Earl, 281 U.S. 111 (1930):
"The claim that salaries, wages, and compensation for personal services are to be taxed as an entirety and therefore must be returned by the individual who has performed the services which produce the gain is without support... it is not salaries, wages, or compensation for personal services that are to be included in gains, profits, and income derived from salaries, wages, or compensation for personal services."
Conner v. U.S., 303 F Supp. 1187 (1969):
"... whatever may constitute income, therefore, must have the essential feature of gain to the recipient. This was true when the 16th Amendment became effective, it was true at the time of Eisner v. Macomber, it was true under Section 22(a) of the Internal Revenue Code of 1938, and it is likewise true under Section 61(a) of the I.R.S. Code of 1954. If there is not gain, there is not income ... CONGRESS HAS TAXED INCOME NOT COMPENSATION."
Edwards (vs) Keith, 231 F110, 113 (1916):
"The phraseology of form 1040 is somewhat obscure .... But it matters little what it does mean; the statute and the statute alone determines what is income to be taxed. It taxes only income "derived" from many different sources; one does not "derive income" by rendering services and charging for them... IRS cannot enlarge the scope of the statute."
Lauderdale Cemetary Assoc. v. Mathews, 345 PA 239; 47 A. 2d 277, 280 (1946):
"... reasonable compensation for labor or services rendered is not profit."
Terry Ingram, Founder, Law In Simple Terms
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