Talk:Sixteenth Amendment to the United States Constitution/Archive 8

Hey, let's read the 1913 Form 1040

Dear readers: Here's another comment about the phony claim about Form 1040 by the anonymous user at IP 129.137.3.208:

"The original 1040 for 1913 implemented exactly what Congress intended to achieve with the 16th. You can read it at the irs.gov site, and see that it does not include wages as taxable income."

I agree that the original Form 1040 for 1913 "implemented exactly what Congress intended," etc. You see, I have a copy of the form. Although the copy of the 1913 Form 1040 at the IRS web site does not appear to want to load up properly on my computer at the moment, readers can find the form at other web sites by doing a google search.

The 1913 Form 1040 is a three page form, plus instructions. Page 1, line 1 clearly states: "Gross income (see page 2, line 12)." Line 12 on page 2 is the "total" line for page 2.

The very first line for the various kinds of taxable income on page 2, under "DESCRIPTION OF INCOME," is "Total amount derived from salaries, wages, or compensation for personal service of whatever kind and in whatever form paid" (bolding added).

Are we starting to see a trend here with the material provided by the user at IP 129.137.3.208? Falsely citing "Gurley v. Rhoden" for an argument about the validity of the Federal income tax on wages -- when the case did not even involve Federal income tax, much less taxation of wages. A false claim that the 1913 Form 1040 "does not include wages as taxable income" when it clearly does. Does IP129.137.3.208 think that nobody can check this kind of stuff?

Dear IP 129.137.3.208 -- please do not falsely cite IRS tax forms unless you want to be called on it -- or you enjoy being exposed.

Hint #1: Lots of tax practitioners have ready internet access to all the statutes, regulations and court decisions on taxation since the year 1913. Further, all the decisions before 1913 are available at the library of any law school. Do not cite court decisions that you don't want other people to check.

Hint #2: Lots of tax practitioners keep clean copies of the IRS forms and instructions going back for many years. We need them for our work. Yours, Famspear 19:17, 15 January 2007 (UTC)

would income derived from wages,compensation etc mean the same as income derived as wages ? I would like to make the following changes for sake of clarifying intent.

I feel the italized additions should be made for sake of factual content

Income taxation of wages, etc. The courts have interpreted the Sixteenth Amendment as standing for the rule that the Amendment allows a direct tax on income derived from"wages, salaries, commissions, etc. without apportionment."

Interpretation The Amendment—which overrules the effect of Pollock[18] -- essentially means that when imposing an income tax, the Congress may impose the tax on income derivedfrom any source without having to apportion the total dollar amount of tax collected from each state according to each state's population in relation to the total national population.

The omission of these words may lead some people to believe that wges and salaries and compensation themselves are actually taxable i think.

I have this form as well I even have the some of the flyers they came in called the Federal Employee which was distributed amoung government employees.

And you seem to have overlooked the most important words . INCOME, is Total amount derived from salaries, wages, or compensation for personal service of whatever kind and in whatever form paid

now from a legal standpoint how does construction work ? much clearer wording would have perhaps been derived as wages?

OR did they actually intend it to be the derived income from the use of wages, salaries, as the wording appears to say. thanks for your honesty in this.

I am sorry we are at odds here on this FAM but the misunderstanding you seem to be applying to this word is the very same one 99% population is making.

You can not derive something from a source and the source be the derived object.

```` —Preceding unsigned comment added by 69.245.136.69 (talk) 23:39, 17 November 2007 (UTC)

given we are back to incorrect  information being given can it be assumed that no regard for honesty is to be found here ?  69.245.136.69 (talk) 05:05, 18 November 2007 (UTC)

Income under the Constitution versus wages for purposes of statutory tax withholding

An anonymous editor at IP 198.153.17.188 inserted a fragment from the definition of wages from 26 U.S.C. § 3401 -- in the section discussing income under the U.S. Constitution. The edit as inserted by the anon resulted in an incorrect definition of income.

The term "wage" as used in section 3401 refers to "wage" (or salary or other compensation for personal services) for purposes of the tax withholding requirements. That is not necessarily the same as the definition of "wage" for purposes of 26 U.S.C. § 61 (i.e., relating to the issue of what is a "wage" for purposes of the Federal income tax itself under 26 U.S.C. § 1. More importantly, the term "income" as discussed in the article refers to income under the Constitution, which may be a broader definition than that for income under some provision of the Internal Revenue Code such as section 61 or section 3401. Yours, Famspear 21:29, 24 January 2007 (UTC)

Naming conventions in case law citations

An anonymous editor changed the abbreviated references to the Pollock case from "Pollock" to "Farmers' Loan." In citing U.S. case law regarding Federal taxation, the convention is to cite the first listed party (in this case, Mr. Pollock) unless the first listed party happens to be the Collector of Internal Revenue, the Commissioner of Internal Revenue, etc. In this case, Pollock was a private citizen, so in abbreviated citations, you would normally cite the case as Pollock and not as Farmers' Loan. I therefore reverted the edits. Yours, Famspear 18:04, 4 February 2007 (UTC)

OK, I see that editor Mateo SA has already corrected this. Yours, Famspear 18:06, 4 February 2007 (UTC)

I was thinking of adding something, but...

I was thinking of adding to the article and was amazed to find the controversies being played out here. Now I'm having second thoughts. Suprisingly, the topic I was interested in including my have some relevance to the argument. Here it is...

One very important landmark tax decision not discussed here by either side of the discussion is Hylton vs US, 3 US 171 (1796).

[http://caselaw.lp.findlaw.com/scripts/getcase.pl?navby=CASE&court=US&vol=3&page=171 ]

This case is important for two reasons. It clarifies, for the first time, the ill-defined terms in the taxation sections of Article 1 of the US constitution. Secondly, Alexander Hamilton and Chief Justice Paterson are participants who were both "framers" of the 2-year old constitution; they should know what they are talking about with regards to original intent.

From Hylton vs US...

"...direct taxes contemplated by the Constitution, are only two, to wit, a capitation, or poll tax, simply, without regard to property, profession, or any other circumstance; and a tax on LAND. I doubt whether a tax, by a general assessment of personal property, within the United States, is included within the term direct tax".

Emphasis is in the orginal, not my own.

This ingenuously omits the words "I am inclined to think" with which the sentence begins; why should we quote dictum? Septentrionalis PMAnderson 19:47, 9 February 2007 (UTC)

Statements made in this discussion that property taxes were considered a direct tax by the framers of the constitution conflict with this very clear statement. Next, from Justice Paterson's opinion...

"It was, however, obviously the intention of the framers of the Constitution, that Congress should possess full power over every species of taxable property, except exports. The term taxes, is generical, and was made use of to vest in Congress plenary authority in all cases of taxation. The general division of taxes is into direct and indirect. Although the latter term is not to be found in the Constitution, yet the former necessarily implies it. Indirect stands opposed to direct. There may, perhaps, be an indirect tax on a particular article, that cannot be comprehended within the description of duties, or imposts, or excises; in such case it will be comprised under the general denomination of taxes. For the term tax is the genus, and includes,

1. Direct taxes.

2. Duties, imposts, and excises.

3. All other classes of an indirect kind, and not within any of the classifications enumerated under the preceding heads.

The question occurs, how is such tax to be laid, uniformly or apportionately? The rule of uniformity will apply, because it is an indirect tax, and direct taxes only are to be apportioned. What are direct taxes within the meaning of the Constitution? The Constitution declares, that a capitation tax is a direct tax; and, both in theory and practice, a tax on land is deemed to be a direct tax. In this way, the terms direct taxes, and capitation and other direct tax, are satisfied."

So there are, in fact three types of taxes discernable in the US constitution, as intended by its original framers. Tax on carriages, which is under consideration in the Hylton case, is a tax on property and falls into category 3. Therefore, it should be uniformly laid since that is the most equitable in practice. The Hylton vs. US decision contains other very interesting points as well. It clearly explains why the direct tax provision was included in the first place; to satisfy Southern states with large acreages and low populations. It also states, with amazing prescience, that carriage taxes and all other taxes on property are really just ways of taxing an individual's income which was impractical at that time. Justice Paterson, an original Constitutional Convention member, says this explicitly in 1796!

Not amazingly prescient at all; read Adam Smith on the window tax (and he was adopting the conventional wisdom of his time, twenty years before) . Septentrionalis PMAnderson 19:41, 9 February 2007 (UTC)

I think a brief description of the Hylton case in the "Treatment of income taxes prior to the Pollock case" section would be helpful. Furthermore, in Hylton vs. US the Supreme Court states, "It is not necessary to determine, whether a tax on the product of land be a direct or indirect tax" which the Pollock decision directly contradicts. Congress never needed the 16th Amendment to lay unapportioned taxes other than poll or land taxes prior to Pollock because, in Hylton vs US, delivered only two years after the Constitution, the Supreme Court (including "framers") said it already could according to Article 1. It seems pretty clear to me, but then I'm an amatuer, not a lawyer. Does anyone here have a more authoritative opinion? --Riromero 19:34, 9 February 2007 (UTC)

To Septentrionalis: Thanks for claiming I could do something ingenious. The partial quote seemed more succinct. Both Justices say that direct taxes are poll taxes and taxes on land. Does my omission somehow change this conclusion? And it was prescient, in my opinion, to include in the decision a comprehensive statement on taxes, including taxes on incomes, which no one was proposing at the time, but which might prove relevant hundreds of years later. --Riromero 20:10, 9 February 2007 (UTC)

I said ingenuous; and Riromero might benefit from reading the article obiter dictum. Septentrionalis PMAnderson 02:58, 10 February 2007 (UTC)

I'm not trying to make an ironclad legal argument to a judge in court. I'm trying to devine the intent of the original framers of the constitution regarding taxation issues from words that they wrote on the subject in court a scant two years after the fact. Does the weakness implied in Obiter Dictum rule this out? --[Riromero] 03:17, 10 February 2007 (UTC)

• WP:NOR rules this out; if it did not, you might consider that excessive weight should not be put on a claim that Paterson himself marked as tentative. Septentrionalis PMAnderson 03:32, 10 February 2007 (UTC)

Let me start again... I'm not interested in deciding whether income taxes are legal or not. I'm mostly interested in the history of taxation in the USA. This fine article on the Sixteenth Amendment jumps straight from the US Constitution to the Pollock case, stating simply that income taxes were considered excise taxes, not direct taxes, previously. Why this was true isn't exactly clear (from the article) since the Constitution doesn't stipulate the classification conditions. I've also seen it stated that direct taxes are "taxes on personal property by virtue of ownership". Which brings us to the Hylton case. Congress had imposed a tax on carriages; a fee of 16 dollars was to be paid for each carriage owned. This was a tax on personal property by virtue of ownership. Mr. Hylton, who owned 125 carriages for his personal use (not for hire), claimed this was a direct tax and unconstitutional unless apportioned. The US Supreme Court said no, it was not a direct tax. When the constitution was written, they say, direct taxes were meant to be poll taxes and taxes on land. If there were other types of direct taxes they would be classified as direct solely upon the basis of whether it is fair and just to apportion them. As far as I know, this definition of a direct tax stands up till the Pollock case. In fact, even in the Pollard case the Supreme Court is still saying that it is the "land" component that makes "land income" a direct tax. I think a reference to the Hylton case would be a useful addition to the article and helpful for people interested in this fascinating subject.

Now concerning this discussion... I see claims made above regarding the US Constitution and the intent of the original framers. If one reads the Hylton vs. United States ruling, written by individuals who attended the Constitutional Convention, it is very difficult to believe in (regardless of what could be proven in court) at least half of the 11+1 points nailed to the discussion by Wixpositor above, much less the more simplistic claims of less sophisticated tax protesters. I must emphasize that I'm not advocating including Hylton vs. US in the article because it offers any kind of legal proof whatsoever of the validity of income tax laws. I'll leave that entire argument to others. --Riromero 22:04, 16 February 2007 (UTC)

Dear Riromero: Stay tuned; I will try to address some of your points. I'm not sure whether an expansion including a description of Hylton would go here or, alternatively, in the article on direct taxes, or indirect taxes, or whatever. This may take a while, as I am in the middle of tax season myself. Yours, Famspear 22:21, 16 February 2007 (UTC)

Famspear: Thank you. Going back over my notes, I see that The Income Tax and the Sixteenth Amendment (in Notes) Harvard Law Review, Vol. 29, No. 5. (Mar., 1916), pp. 536-538. was my original reference and a nice three page summary of the pre-Pollock tax issues, if it helps. --Riromero 18:13, 23 February 2007 (UTC)

Dear Riromero: OK, and maybe I can find a copy of that law review article some time. Yours, Famspear 03:22, 24 February 2007 (UTC)

"the constitution is stupid"...?

Under the first paragraph of the Background section, I can read this single line phrase "the constitution is stupid". When clicking the "edit" button, this text appears nowhere. Is this a case of a deferred amendment or some bizarro bug in wikipedia? Has the wiki been hacked? —The preceding unsigned comment was added by 86.149.162.10 (talk) 19:46, 11 February 2007 (UTC).

Dear user at IP 86.149.162.10: I have checked and I don't see it on my version. However, I have encountered problems somewhat similar to this in Wikipedia. Sometimes if you clear out your cache in your web browser, it solves the problem. Other times it doesn't. I'm not enough of a "computer person" to know exactly what's going on.

I will check and see if the verbiage is found in an earlier version of the article. I'll be back... Yours, Famspear 19:50, 11 February 2007 (UTC)

OK, I found the verbiage in an edit on 8 February 2007 by a user at IP 204.196.180.12, located here: [1]. However, I don't understand why it would still be showing up on the latest version shown on your computer. Maybe there is a computer tekkie around who can tell us. (?) Yours, Famspear 19:54, 11 February 2007 (UTC)

Someone on raticftaction

Has every state done so? It is still good law because we only need 3/415:07, 12 February 2007 (UTC) Chivista 15:08, 12 February 2007 (UTC)

Ratification dates

I posted the section with complete ratification dates, but someone quickly changed a few of the dates citing the United States Government Printing Office [2]. However, just about every other source I've found online, including the US House of Representatives [3] and Lexis Nexus [4], all have different dates for the following states: Montana, South Dakota, Kansas, Arizona, and Wisconsin. Anybody know why? --CapitalR 06:37, 25 February 2007 (UTC)

• Note, I'm leaving the dates as they were changed by the other user, as listed in the US Government Printing Office site. If someone finds that the dates are incorrect, please do update them. --CapitalR

And I'll try to do some further checking on these differences. Stay tuned. Famspear 00:03, 26 February 2007 (UTC)

Clarification of Brushaber

Hello. I'm new to wiki so forgive me for editing before discussing here.

I will list a few points below of changes i feel would enhance the understanding of this difficult subject.

I believe some weight should be given to the differing views of the courts on whether the income tax is a direct or indirect tax and whether wages should considered to be property or not. I also believe some clarification need to be made about the Brushaber case. Specifically the judgement that the 16th amendment did not allow any new powers to the congress and did not come in conflict with the relevant sections in the constitution(ie a direct tax still must be apportioned) but simply clarified that the income tax which was considered an indirect tax before the Pollock case was to be considered an indirect tax once again. Atleast this is my understanding of the matter.

Additionally the "tax protestor" section could use some additional info and the subject of that text might be changed to something to the effect of "dissenting opinions" or similar. —The preceding unsigned comment was added by Pokeraddict (talk • contribs) 06:52, 18 March 2007 (UTC).

Dear Pokeraddict: I would argue that the section on tax protester arguments actually needs to be reduced, not expanded. This article is about the Sixteenth Amendment. The Brushaber case has its own article. And the tax protester arguments about the Sixteenth Amendment are already found in the article Tax protester constitutional arguments. A decision was apparently made, possibly before I began editing here, that tax protester arguments should be confined to articles dedicated to that topic. In my view that was an excellent decision. Here's why.

From time to time, people pushing tax protester point of view attempt to add tax protester material to various Wikipedia tax articles, perhaps not realizing that the topics are already being covered in articles on tax protester arguments. This tends to lead to both fragmentation and duplication of material throughout Wikipedia. As the duplication increases among various articles, the tax protester material tends to be moved (from tax articles like this one on the Sixteenth Amendment) to the relevant tax protester articles.

Regarding differing views of the courts on whether the income tax is a direct or indirect tax, I think this is already covered, either in the Pollock article or the Brushaber article or the article on the constitutional tax protester arguments.

Regarding the issue of whether wages should considered to be property or not, from a tax law standpoint it's irrelevant to the taxation of wages. And that is already covered in depth in one of the tax protester articles (either Tax protester constitutional arguments or Tax protester statutory arguments) with extensive citations to court decisions.

The Court in Brushaber and other cases has stated over and over that the Sixteenth Amendment did not create any new Congressional power of taxation. The problem for tax protesters is that they keep trying to argue that the Court is saying here that Congress has no power to tax incomes. That is incorrect. The Court is saying that the Amendment created no new power of taxation. No Federal court has ever stated that the Congress has no power to tax incomes. Even in Pollock, the Court did not say that. Indeed, every Federal court decision on this has stated that Congress does have the power to tax incomes, from whatever source derived. Protesters have made a gazillion arguments, for example, that Congress cannot tax wages under the Constitution, etc., and in every single case the courts have rejected that argument. No Federal court in the history of the United States has ever ruled that wages are non-taxable for Federal income tax purposes.

It is correct to say that ALL income taxes were considered to be excises (indirect taxes) before the Pollock case. Pollock changed this rule ONLY with respect to taxes on income from property. The Court in Pollock ruled that taxes on income from property (taxes on interest, dividends, and rents) were to be treated as direct taxes). The Pollock court did not change the rule that all other income taxes (including but not limited to taxes on wages) were still considered indirect taxes.

What the Brushaber Court essentially stated was that the Sixteenth Amendment changed the Pollock rule (overruling Pollock), so that taxes on income from property were again treated as indirect taxes. There was no need to interpret the Amendment as creating a "new" power of taxation, as Congress had always had the power to tax incomes from property, from wages, from whatever.

The point is that the only reason the taxes on income from property had been ruled unconstitutional in Pollock was that they had not been apportioned. Since they were treated as direct taxes, they were required to be apportioned. Had they been apportioned, they would not have been unconstitutional.

Tax protesters constantly misunderstand the Amendment and cases like Pollock and Bushaber and Stanton because they are trying to figure out a way to make income taxes unconstitutional. Income taxes on wages have never been unconstitutional and income taxes on wages have never been apportioned and have never been required to be apportioned.

Contrary to what tax protesters have argued, nothing in the U.S. Constitution either before or after the Sixteenth Amendment has ever prohibited direct taxes. No Federal court has ever ruled that direct taxes are prohibited. The only restriction on direct taxes is that direct taxes must be apportioned, so that the dollar amount of tax collected from the people of each state must be proportional to that state's population in relation to the population of the nation.

The Pollock case and the Sixteenth Amendment are specifically about the effect of the apportionment rule on the Congressional power to impose income taxes - not about the general power of Congress to impose income taxes. The Sixteenth Amendment states that Congress has the power to tax incomes from whatever source, without apportionment, and without regard to any census or enumeration. This is the terrible legal reality that tax protesters cannot overcome.

I would suggest that you carefully review the following articles:

Stare decisis

Obiter dictum

Tax protester constitutional arguments

Tax protester statutory arguments

Tax protester conspiracy arguments

Tax protester history

Yours, Famspear 15:00, 18 March 2007 (UTC)

I would argue that a better historical context on the matter would deepen the understaning and importance of the interpretations of the 16th amendment.

Yes the Pollock and Brushaber case give a good historical overview of what was happening around the time of the ratification(although I believe the text in the Brushaber section can be clarified slightly in regards to the interpretation that income tax is an indirect tax.)

However much has happened since then and it seems the judgement in Brushaber and by extension the 16th amendment has in some cases been misinterpreted to mean that it makes a direct tax which is not apportioned legal when it in fact clearly states that it gives no new powers but simply says that an income tax is an indirect tax. I'm not suggesting listing every conceivable case of any significance since then obviously but I believe a short explanation of differing opinions could be beneficial.

I agree with your view that Brushaber made it clear that congress could impose an indirect income tax. However I'm not sure I agree with you that tax protestors are necessarily disagreeing with that. Today different courts have different interpretations of what the income tax is. If federal court A holds that the income tax is a direct one which is supposed to be illegal while state court B believe it's an indirect law it appears atleast for the uninitiated that this could be a serious problem and basis for these claims that the income tax is illegal.

You might be right that it is irrelevant whether income is property or not. can owned property be taxed indirectly?

--Pokeraddict 17:00, 18 March 2007 (UTC)

Dear Pokeraddict: The three holdings in Brushaber are already clearly stated in the article.

The main points of the whole discussion about income taxes, especially as related to the original text of Article I, the text of the Amendment, and the various Federal court decisions down through the years, are as follows:

1. The question of whether a particular income tax is direct or indirect is legally irrelevant to the question of whether the Congress has the power, under the U.S. Constitution as amended by the Sixteenth Amendment, to impose that tax. Congress has the power to impose any income tax, regardless of whether that tax is deemed direct or indirect.

2. The question of whether a particular income tax is direct or indirect is also legally irrelevant to the issue of whether that tax must be apportioned. After the Sixteenth Amendment, no income tax of any kind whatsoever, whether direct or indirect, is required to be apportioned.

3. Under the Constitution as amended, the only important legal relevancy to the question of whether a particular income tax is Constitutionally valid (aside from rules such as the one prohibiting taxes on exports, or rules that revenue measures must originate in the House, etc.) is probably whether that income tax is imposed with what the law refers to as geographical uniformity. That is, an income tax cannot be imposed on, say, just the incomes of people who happen to reside in New York and Montana.

Just to be clear, nothing in the U.S. Constitution (either before or after the Amendment) says that Congress cannot validly impose a direct income tax or an indirect income tax. And no Federal court has ever ruled that Congress cannot validly impose a direct income tax -- or an indirect income tax. The only restrictions were basically (1) the apportionment restriction (and that one applied only to those particular income taxes that happened to be direct taxes - namely taxes on interest, dividends, and rent), and (2) the uniformity restriction. The apportionment restriction was removed by the Amendment, leaving just the uniformity restriction. And no Federal income tax has ever been imposed on, say, just the residents of New York and Montana.

Stay tuned. Yours, Famspear 18:23, 18 March 2007 (UTC)

Post-script: I should add that as far as what tax protesters argue about the income tax, the arguments are all over the map. The protesters cannot agree among themselves. And all the tax protester arguments are legally invalid. Further, all the arguments are legally frivolous, as the courts have so ruled over and over.

Let's look at some of the arguments.

Some protesters argue that the "income tax is a direct tax", and that Congress somehow cannot validly impose direct taxes. That is blatantly incorrect, for two reasons. First, Congress can indeed validly impose any direct tax; the Constitution specifically allows for imposition of direct taxes, and there is absolutely no limitation whatsoever in the text of the Constitution (either before or after the Amendment) as to what kind of direct taxes (property tax, capitation, income tax, whatever). Second, the statement that the "income tax is a direct tax" is legally meaningless. Which income tax is a direct tax? Taxes on income from personal services (such as wages, salaries, etc.) have always been categorized as indirect taxes (even by the Pollock case). Taxes on income from property also were always categorized as indirect taxes -- except under the Pollock line of cases. And the effect of the 1895 decisions in Pollock for taxes on income from property was overturned by the Sixteenth Amendment in 1913, so the Pollock treatment of taxes on income from property has been legally moot since 1913.

Other tax protesters argue that the income tax is an indirect tax, and is somehow unconstitutional for that reason. That argument is just as incorrect and, to put it bluntly, even more bizarre. If all income taxes are excises (indirect taxes) then you have no chance of getting those income taxes ruled invalid on the grounds of non-apportionment, as the apportionment/non-apportionment rule does not apply to indirect taxes at all. The limitation on indirect taxes is the geographical uniformity rule. As far as I know, even the most deluded, crazed tax protesters have never argued that income taxes are not imposed with geographical uniformity (e.g., are imposed only in New York and Montana, or whatever). If anything, their complaint is that the income tax is being imposed uniformly. (You may be familiar, for example, with the bizarre argument that the income tax should somehow be invalid because it could only be imposed in the District of Columbia or Puerto Rico, etc., and not within the "fifty states" -- a completely laughable argument, and one that is totally legally frivolous.)

Still other protesters take a middle ground of sorts -- but they immediately sink into what is legal quicksand, just the same. They argue that, well, the income tax is a direct tax and that the Sixteenth Amendment does not really mean what it says, and that the Sixteenth Amendment cannot change the legal effect of the original text of Article I regarding apportionment, and that income taxes, as direct taxes, must still be apportioned even though the Sixteenth Amendment clearly states that income taxes do not have to be apportioned, and since the income taxes are not apportioned, the income taxes must somehow be invalid. This argument is completely off the wall. First, the idea that a constitutional amendment cannot change, repeal, partially repeal, amend, modify, or affect the application of a provision of Article I is completely without legal merit. Every single Federal court, from and including the Supreme Court in Brushaber on down to the present day, has upheld every single income tax statute since 1913 where that statute has been challenged under the -- again, to put it bluntly -- doofus theory that the Sixteenth Amendment somehow cannot change the application of Article I with respect to the apportionment of income taxes. Tax protesters love to quote certain language from Brushaber and similar cases about irreconcilable conflicts, etc., but then the protesters not only take that language out of context and try to put their own interpretation on that language, they also ignore the holdings, the rulings in Brushaber and all the other cases. In every single case since 1913 where an income tax was challenged as being unconstitutional because it was not apportioned (and, by the way, no Federal income tax has ever been apportioned), the income tax was upheld as Constitutional. A few income taxes were ruled unconstitutional, but for entirely different reasons that are no longer legally viable.

No court has ever ruled the income tax imposed under the Internal Revenue Code of 1986 to be unconstitutional on the ground that the tax was unapportioned, or on the ground that Congress cannot impose a "direct tax," or on the ground that Congress cannot impose an "indirect tax," or on any other similarly silly theory. Yours, Famspear 20:41, 18 March 2007 (UTC)

Hello,

You assert that the 16th amendment made it possible to impose a direct income tax that did not comply with the rule of apportionment. Could you cite a case where they make this conclusion? It is my opinion that the case Brushaber v. Union Pacific clearly states that this is not the case, in fact it is the court's opinion that an income tax is to be considered an indirect tax. I will give a brief basis for my view pn this below.

In the time before the Pollock case a taxation on property because of ownership was viewed to be a direct tax and therefore had to be apportioned. other kinds of taxes, including income taxes, which where not imposed on property because of ownership where considered to be indirect taxes which should comply with the rule of uniformity.

"Upon the lapsing of a considerable period after the repeal of the income tax laws referred to, in 1894 [28 Stat. at L. 509, chap. 349], an act was passed laying a tax on incomes from all classes of property and other sources of revenue which was not apportioned, and which therefore was of course assumed to come within the classification of excises, duties, and imposts which were subject to the rule of uniformity, but not to the rule of apportionment. The constitutional validity of this law was challenged on the ground that it did not fall within the class of excises, duties, and imposts, [240 U.S. 1, 16] but was direct in the constitutional sense, and was therefore void for want of apportionment, and that question came to this court and was passed upon in Pollock v. Farmers' Loan & T. Co."

Pollock v. Farmers' Loan & T. Co

the court held that indirect taxes which where based on the income of property owned where unconstitutional in substance on the basis that to impose such a tax would for all intents and purposes be to tax the property itself without the need for apportionment, something that could not have been the intent of the constitution. Therefore these specific taxes where to be treated as direct taxes subject to the law of apportionment.

Brushaber v. Union Pacific

The court judged that the 16th amendment where to be interpreted as to do away with the decision in Pollock and put all income taxes, from whatever source derived, back into the excise class to which it belonged and therefore be subject to the law of geographical uniformity. It was not the view of the court that the 16th amendment gave the right to impose a direct unapportioned income tax nor do I believe it was decided that an income tax could be taxed directly even if apportioned since a direct tax was only imposed on property because of ownership. —Preceding unsigned comment added by Pokeraddict (talk • contribs) (on 20 March 2007)

Dear Pokeraddict: It sounds like you and I may be pretty much in agreement on some major issues. Here's what I mean.

The language in cases like Brushaber has two characteristics which make it difficult to follow. First, the language is archaic, to the point of being in some places actually ungrammatical by 21st Century standards. Second, the language is circumlocutory. That is, the Court states things in roundabout ways, where more direct statements would be more helpful.

There are two possible ways to read Brushaber and the other cases after it that interpret the Sixteenth Amendment. Both ways, however, bring you to the same result from a legal standpoint.

Alternative A: One way is to say that the Sixteenth Amendment did not change the part of the Pollock ruling that held that taxes on income from property (taxes on interest, dividends, etc.) should be treated as being direct taxes in substance.

Alternative B: The other way is to say that the Amendment did change that ruling, and that the Amendment put those income taxes back in the category of excises (indirect taxes) -- i.e., put those taxes back in the category of taxes not required to be apportioned.

Under Alternative A, one would say that "the language of the Amendment doesn't care," essentially, whether a particular income tax was considered a direct tax by the Court in Pollock. And essentially, from a legal standpoint, that would be correct. Here's why.

The amendment says that Congress shall have power to impose taxes on incomes, from whatever source derived, without having to apportion the taxes among the states, etc., etc. There is absolutely no limitation in this language regarding which kinds of income taxes are covered by the amendment. The amendment does not say "income taxes that happened to be considered direct taxes in the Pollock decisions." The amendment does not say "income taxes that happened to be considered indirect taxes in the Pollock decisions." The amendment does not say "income taxes that happen to be taxes your grandmother has to pay." The amendment does not say "income taxes that happened to be income taxes your dog has to pay." The amendment does not say "income taxes that happened to be income taxes you have to pay while standing on your head and whistling Dixie backward."

The amendment says "taxes on incomes." There is absolutely no limitation in the text of the Amendment. Under ordinary rules of construction, that means that if it's an income tax, it's covered by the rule of the Amendment. If you're looking a particular tax, and it happens to be an income tax, then from a legal standpoint it doesn't matter whether that tax is a direct tax or is not a direct tax or would have been a direct tax under Pollock or would not have been a direct tax under Pollock. That's what various courts have meant when they have said that the Amendment authorizes a direct tax on incomes without having to apportion the tax.

On the other hand, Alternative B -- the interpretation that the Amendment actually put the income taxes that had been treated in Pollock as direct taxes BACK into the category of indirect taxes -- is supported by some of the language in the Brushaber case. If you like Alternative B, you reach the same legal result. If all income taxes are indirect taxes, then by definition NO income taxes are required to be apportioned (since the apportionment rule applies only to direct taxes).

The key point is that various Federal courts have essentially used both Alternative A and Alternative B from time to time and, as explained below, BOTH ALTERNATIVES ARE LEGALLY CORRECT.

Tax protesters have come into court on various occasions and have argued, essentially, that the Sixteenth Amendment does not authorize a direct tax, or that the Amendment does not authorize a direct unapportioned tax. I was re-reading a case just the other day where someone had argued that. The court came back with the flat statement that the Amendment indeed DOES authorize a direct unapportioned tax. And that statement, from a legal standpoint, is correct.

Remember the all-encompassing flat out statement of the Sixteenth Amendment: taxes on incomes. The amendment itself says nothing about taking certain income taxes considered by the Pollock court as direct taxes and putting them back in the category of indirect taxes. Sure, that language in one form or another is found in Brushaber or in some cases that cite Brushaber. That language is not in the Amendment itself.

Well, how (you may ask) can both Alternative A and Alternative B be considered correct, considering the language in Brushaber?

The answer is that under U.S. law, a case is important not for all the detailed reasoning that went into the decision, but only for the decision itself. This is the rule of Stare decisis. Case law is different from statute. In a statute, almost every word is important. In case law, much of the statements of law and the statements of the court's reasoning are what the law refers to as obiter dicta, or words said in passing (singular, Obiter dictum). Obiter dicta are non-binding statements by the court included in the court's opinion that are not part of the binding decision itself. Even correct statements on rules of law that are made by the court in a case are really obiter dicta -- as far as that case is concerned. The same statements in some other case may be part of the court's holding, part of the actual decision.

Separating the decision from the dicta in court opinions is just one part of what law students do in studying the actual, verbatim texts of literally thousands of court decisions during law school. That process continues after the individual completes law school, obtains the degree, passes the bar exam, is inducted as an attorney, and begins the practice of law. The skill of distilling the holding (roughly, the decision) or holdings of a case cannot be adequately learned by reading the texts of one, or ten, or even a hundred court opinions.

The mere fact that the Court in Brushaber used, or arguably used, Alternative B in dicta does not foreclose the proper use of Alternative A by another court -- to reach the same result. The legal result is the same under both lines of reasoning, and under the U.S. legal system it is the decision that is of primary importance, not the winding paths used by courts to reach that decision. Yes, the path is important -- but the decision itself is paramount.

This means that when you cite a case like Brushaber, you have to understand that much of the language in the case is non-binding dicta. The mere fact that the Brushaber court may have used one line of reasoning (such as, "this Amendment put those taxes back in that category over there") does not foreclose another court from using another line of reasoning to reach essentially the same decision reached in Brushaber, or to reach some other decision that does not conflict with the decision(s) in Brushaber. Under the U.S. legal system, a court case is important for WHAT it decides, not HOW it decides.

Your statement -- that the Brushaber court judged that the Amendment should be interpreted as to do away with the decision in Pollock and put all income taxes, from whatever source derived, back into the excise class -- is essentially a correct reading of the effect of the Amendment -- but it's only one of the correct readings. It's correct under the Alternative B approach. The Alternative A approach, while different in form, is also correct. The Federal courts have used both approaches to reach the same legal result.

In the article, it's important not to get bogged down in the dicta found in Brushaber and other court cases, and to instead focus on the decisions themselves -- the actual, detailed legal result that followed from an actual, detailed set of facts. Yours, Famspear 15:27, 20 March 2007 (UTC)

PS: Dear Pokeraddict: I also reverted your most recent edits, based on the above lecture. However, one thing to consider would be to expand the article to create a new section to show the "Alternative B" reasoning the Court used, and then to contrast that reasoning with the "Alternative A" reasoning used in other court cases. That section would be labeled as a discussion of the non-binding dicta in the Sixteenth Amendment cases, to illustrate the different ways courts achieve the same result. That approach might help people understand the difference between the three holdings, the decisions, in Brushaber, on the one hand, and (on the other hand) the reasoning methods, the "how they reached the decisions," the non-binding dicta.

What do you think? Famspear 15:45, 20 March 2007 (UTC)

Actually, on second thought, maybe this kind of thing should go in the article on Brushaber. I'm not sure. Famspear 15:47, 20 March 2007 (UTC)

I think my brain hurts trying to understand all this.  :-) Morphh <sup>(talk)</sup> 15:52, 20 March 2007 (UTC)

I know, I know, and this is a simplified version, believe me. Famspear 15:54, 20 March 2007 (UTC)