Otto Skinner asserts that the Sixteenth Amendment does
not authorize a direct non-apportioned income tax and thus, U.S. citizens
and residents are not subject to federal income tax laws. To the contrary,
the courts have both implicitly and explicitly recognized that the Sixteenth
Amendment authorizes a non-apportioned direct income tax on United States
citizens and that the federal tax laws as applied are valid. In United
States v. Collins, 920 F.2d 619, 629 (10 th Cir. 1990), cert. denied,
500 U.S. 920 (1991), the court cited to Brushaber v. Union Pac. R.R.,
240 U.S. 1, 12-19 (1916), and noted that the U.S. Supreme Court has recognized
that the "sixteenth amendment authorizes a direct nonapportioned
tax upon United States citizens throughout the nation.
Here's what Irwin Schiff has to say about Otto
While everyone has a right to be wrong, Otto Skinner simply abuses this
Some time ago I sent out an e-mail in response to
a slanderous e-mail sent out by Otto Skinner as described further on.
More recently Otto Skinner posted on his Web site an alleged refutation
of my labeling him a liar. My characterization of him occurred
on my radio show and it was in connection with his obvious misstating
of the court decisions, as covered in my e-mail (analyzed below) which
I am now posting here.
Without wasting any more of my time addressing all
of the fallacies contained in Otto Skinners most recent posting
entitled Irwin Schiff Calls Otto Skinner a Liar, I will
simply quote and address two paragraphs contained in that posting. However,
these two paragraphs should convince anyone that no one should believe
anything Otto Skinner says about income taxes. The following paragraph
appears at the end of his posting.
Schiff offers a $5,000 reward if anyone can find a law that requires
the payment of the (income) tax. I consider this to be an empty offer.
Just because there is no such law, it does not prove a tax is not owed.
[Then what does it prove? Anything?] If a person owes a tax, but simply
cannot pay it, he cannot be legally incarcerated. We do not have debtors
prisons in this country. Because of this, there could be no law requiring
the payment of a tax. Schiffs offer might sound impressive, until
you analyze it. Will Schiffs nonsense never stop? You should be
aware of the fact that Section 7203 does make it a crime for a person
to willfully fail to pay a tax that is owed. If a person owes a tax
and can pay it, but willfuly does not pay it, he can be charged with
If anyone can figure out what Otto Skinner is talking
about, they are more perceptive then I am. What, I believe, we can conclude
from the above is:
1) Otto Skinner believes that even though there
is no such law as would require a person to pay income taxes,
a person can still owe an income tax. (Otto keeps using the word tax
without qualifying that it is an income tax. If he is not
talking about income taxes, than what kind of taxes is he
2) Ottos reasoning is that that a person can
still owe an income tax (even though there is no law that
requires the payment of such a tax), because we dont have debtors
prisons in this country. (Do you see any connection? I dont).
But if there is a connection, how does Otto Skinner explain the fact
that the Code still lists in its Index, some 40 other federal taxes
that Americans can owe? Of course, an income tax is not included in
3) Since Otto believes that there are laws making
income tax violations crimes, he believes that, while there is
no such law that requires the payment of income taxes, you can
still be prosecuted and go to jail if you willfully (do) not pay
a tax that no law requires you to pay.
I really should apologize to Otto; maybe he wasnt
lying after all. He obviously simply does not know what he is talking
Also in that posting he states
Schiff also claims in his books and articles that
the federal district courts do not have criminal jurisdiction over alleged
violations of Title 26. However, the United States Criminal Code states:
The district courts of the United States shall
have original jurisdiction, exclusive of the courts of the States, of
all offenses against the laws of the United States.
18 U.S.C. 3231.
There seems to be no end to Otto Skinners ignorance
when it comes to income taxes. The revisers notes for Section
3231 state that Section 3231 Was formed by combining sections
546 and 547 of Title 18, U.S.C. 1940 ed
. with no change of substance.
If you check Section 546 you will find that it states,
The crimes and offenses defined in this title shall be cognizable
in the district courts of the United States
. In other words,
the jurisdiction referred to in Section 3231 only applies to crimes
listed in Title 18.
Since income tax crimes are not listed
anywhere in that Title (nor in Title 26 for that matter), Title 18 doesnt
apply to income taxes. The government left out crimes and offenses
defined in this title when it combined both sections, so it could
use this Section to illegally prosecute alleged offenses listed in Title
26 and in other Titles.
The government obviously relied on the general ignorance
of the American public to get away with it. And Otto didnt disappoint
Code Section 7401(f) of the Internal Revenue Code
which is the jurisdictional section of the Code - supplies more
icing on this cake. It states: For general jurisdiction of the
district courts of the United States in civil actions involving internal
revenue, see section 1340 of Title 28 of the United States Code.
If Section 3231 gave the government the criminal jurisdiction
that Otto Skinner believes it does, Section 7401(f) would have similarly
stated, For criminal jurisdiction see 3231 of Title 18;
but no such reference appears in Section 7401(f) nor in any other section
of the Internal Revenue Code.
These two factors alone prove that all of those who
have been criminally prosecuted for committing alleged income tax crimes,
were all prosecuted illegally. (And I havent bothered to list
a number of other factors.) But Otto Skinner knows nothing about this
All things considered, it should be obvious that people
will get far better tax advise if they seek it from H.R. Block, rather
than from Otto Skinner.
For more proof as to why you cant believe anything
that Otto Skinner says, read on.
The Following was an earlier response I made in connection
with an E-Mail sent out by Otto Skinner, which I've now decided to post
Otto Skinner (who has a web site suggesting he knows
something about income taxes), sent out a 6-page e-mail letter written
by John Elizondo, a former colleague of mine, whose association I terminated.
John's letter was nothing but a tissue of lies from
start to finish, which I will get to shortly. But how could Otto Skinner
send out such a letter without first attempting to verify whether any
of it was true?
I could actually sue Skinner for slander, but I am
so busy litigating important suits against the government (including
a devastating petition for a writ of certiorari to the Supreme Court)
and trying to write a new book, that I can't afford to waste time on
However, before turning to John's letter, I am compelled
to put Otto Skinner in perspective. It is safe to say that Otto has
probably mislead more people on the subject of income taxes than anyone
else in the anti-tax movement with the possible exception of Dan Pilla.
He concocted the hair-brain theory that the labor
of an ordinary worker was a "common right" and, therefore,
not a "revenue taxable activity." What the people didn't know,
who were struggling to understand this concept, is that the Internal
Revenue Code didn't tax anyone's labor anyway.
So, Otto merely erected a straw man, which he then
sought to rail against. But Otto Skinner's "theory" was wrong
on a variety of grounds. First of all, if the federal government wanted
to tax labor it could do so, as long as it apportioned the tax.
His theory that the government can't tax a "right"
is also nonsense. People certainly have a right to live in a house,
yet government puts property taxes on houses, which if you can't pay,
you are forced to move.
A person certainly has a right to leave property to
his children or make gifts; but the government imposes estate and gift
taxes. A person certainly has a right to breathe; yet the Constitution
allows the government to tax breathing.
Article I, Section 9, Clause 4 of the Constitution
allows the government to impose a capitation tax - which is a head tax.
But only people who are breathing would be required to pay the tax.
So a head tax is tantamount to a tax on breathing.
Also, a number of cites actually have wage taxes -
so Otto's "theory" that government can't tax occupations of
a "common right" exists only in his muddled mind.
But to understand how little Otto Skinner really knows
about income taxes, we need only turn to his latest book. I didn't buy
the book, somebody merely faxed me pages 208-210, since they dealt with
my "zero" returns and me. He calls this treatment of my "zero"
return, "Flawed argument #12". He then writes:
"To support this frivolous, and dangerous
position, the promoters (meaning me) list three appellate court decisions:
(U.S .v. Moore, U.S. v. Long, U.S. v. Kimball, as listed in my "zero"
return attachment along with a number of other legal references that
support the legal validity of my "zero" return and its claim
for refund for all income and wage taxes paid). This position is further
supported with the flawed claim that the term "income" only
means corporate profit."
So the first thing we discover here is that Otto Skinner
doesn't even understand the legal meaning of " income," which
means corporate profit, since only corporate profits can fall within
the meaning of "income" as allegedly "defined" in
Code Section 61. So this dolt, who hasn't the faintest idea of what
"income," for tax purposes, actually means, presumes to write
books on income taxes, and on "flawed arguments" no less.
He then writes:
"By submitting such forms, the individual
is setting himself up for a $500 civil penalty for filing a frivolous
return for each return filed, along with the distinct possibility of
criminal charges for attempted tax evasion and also for filing false
and fraudulent returns."
Here Skinner further misleads his readers into believing
that IRS agents have the authority to assess civil penalties when they
have no such authority. (All IRS agents are merely administrative clerks
with no enforcement powers whatsoever.)
In addition, the attachment to my zero return cites
no less than 15 court decisions and 10 statutes, as well as other authorities
to support our claim of "zero" income and claim for refund;
and, therefore, can not be considered frivolous (i.e., silly) on any
In addition, even though thousands of people have
filed "zero" income tax returns which have generated thousands
of refund checks (see examples of some on my web site, "www.paynoincometax.com"),
only one person has been charged with a crime for having done so - and
he was about to be indicted for having failed to file tax returns and
income tax evasion going back 4 or 5 years. So he filed zero returns
for those back years hoping that this would stop his forthcoming indictment,
but they indicted him anyway, despite the fact that the U.S. attorney
did not present any evidence to the grand jury that any statements on
his "zero" returns were incorrect.
However, had this individual understood what he was
doing and had he enlisted my help, he never would have been convicted.
But I have filed "zero" returns myself since 1993 and haven't
paid a dime in income taxes and the feds haven't bothered me.
In addition, my "zero" returns have generated
hundreds of thousands of dollars in refund checks for those filing them,
and no one has been charged with filing false refund claims. But more
important, if these refund claims were false, I would have been prosecuted
under Code Section 7206, which makes it a crime for anyone to advise
or counsel people to file false and fraudulent tax refund claims.
So, while Otto Skinner believes that a "zero"
return represents a "false and fraudulent return," apparently
the feds don't think so, since they haven't interfered with me in any
way as I go about each day teaching more and more people how to do it.
Skinner then goes on to write:
"The Moore Case simply does not support the
proposition that is purported by the promoters (me, again). Moore was
convicted for failure to file returns. He had entered zeros on returns
for the years 1972, 1973 and 1974. The Seventh Circuit Court of Appeals
It is not the false data which makes these returns
defective, but the fact that there is no real attempt to comply with
the filing requirement of filing a return
The above quotations from Skinner's book prove one
of two things: either Otto Skinner can not read and understand simple
English or he, like John Elizondo, is an unconscionable liar. It is
clear from the Moore Case that Moore did not "enter zeros on his
returns" as Skinner unabashedly claims. Quoting from the decision
itself (627 F.2d 830) the Appeals court wrote:
In April 1973 defendant and his wife submitted a joint
return for the 1972-year to the I.R.S. This form contained only their
names, occupations, social security numbers and number of dependents.
Fifth Amendment objections were written across the form and a packet
of tax protestor literature was attached. The defendant and his wife
signed the form, but the verification was scratched out (which we also
In May, however, defendant submitted an amended 1040
form for the 1972 year
On the amended form defendant filled in
the various blanks calling for numerical information with "none"
except dividend income he put $41 and under dividend income he placed
the figure $22. The Fifth Amendment objections were retained and more
tax protest material was appended. Although signed, the certification
on the Form was again marked over.
In 1974 defendant also filed a return for the year
1973, which was substantially the same as his amended form for 1972.
It contained a small amount in interest income and the certification
was scratched out
in 1975 defendant filed a similar return for
the 1974 year.
Thus, there is absolutely no truth whatsoever in Skinner's
claim that Moore "had entered zeros on returns for the years 1972,
1973 and 1974," let alone that his returns resembled in any way
the "zero" returns we file. (See a sample of our "zero"
return on our web site). Thus, Skinner and Elizondo are birds of a feather
in that truth is immaterial to them.
In addition to the above, the Moore court went on
In U.S. v. Long
the taxpayer submitted a form
with zeroes in all the blanks. The court held that even if this information
was false, a tax liability could be computed from it and it was, therefore,
an adequate return
The Ninth Circuit is clearly correct in stating
that a tax liability could be computed from zeroes
Thus the Moore Court drew a distinction between the
return that the Moores filed (which were not "zero" returns),
and the "zero" return filed in the Long case, which the Moore
court (agreeing with the 9th Circuit) stated constituted "an adequate
Apart from misrepresenting Moore, Skinner also misrepresented
both the Long and Kimball decisions, but why go on beating a dead horse.
The extent by which Skinner misrepresented the Moore decision is more
than enough proof that Otto Skinner cannot be trusted to tell the truth
on any issue.
As if the above were not enough, Skinner goes on to
"Now to the supposed "supporting argument"
claiming that the term "income" only means corporate profit
promoters of this flawed argument make a leap in logic to conclude that
the term "income" only means corporate profit. This is truly
a "frivolous position" because the United States Supreme Court
has never held that the term "income" is limited to corporate
profit. It has essentially held that "income" means what ordinary
dictionaries say it means."
This paragraph alone proves that Otto Skinner knows
nothing about income taxes, yet he presumes to write books on the subject.
The Supreme Court never ruled, "'income' means what ordinary dictionaries
say it means." They have ruled that "income," for tax
purposes, means a corporate profit - and we cite 10 such Supreme Court
decisions in the attachment to my "zero" return.
Prior to 1954, all Internal Revenue Codes (including
the original 1913 statutes) included "wages," "salaries"
and "compensation for personal services" as being taxable
as income. However, these references were specifically removed from
the 1954 Code, as Congress sought to bring the 1954 Code into conformity
with prior Supreme Court decisions.
In making these changes from the 1939 to the 1954
Code, both the Senate and House committee reports stated that the word
"income" as used in the 1954 Code was used "in its constitutional
sense." Income, therefore, as used in the Code is "used in
its constitutional sense" and not in its ordinary, economic, or
And, in its constitutional sense "income"
means a corporate profit. Proof of this can be seen from the fact that
corporations can have millions of dollars worth of income, but only
pay "income" taxes on their "profit." In essence,
the so-called income tax is, in reality, a "profits" tax.
If corporations don't have a "profit," they pay no income
taxes - regardless of how much "income" they receive.
And, since Code Section 61 does not make a distinction
between individuals and corporations, whatever applies to corporations
must also apply to individuals. So, if corporations aren't required
to pay income taxes on their "income," neither are individuals.
What's hard about that?
This will give you a rough idea of how little Otto
Skinner knows about income taxes.
~ Irwin Schiff