John Harpole was found guilty in Anchorage this summer of IRS charges and Larry Becraft filed a rule 29 Motion of Acquittal which was denied by the Chief Judge of the USDC, James K. Singleton.

                I have been very vocal against the purported defense by Becraft, which in my opinion took John to the sheep shearers with Becraft supplying the shears and Singleton obtaining another IRS trophy.

                This is my opinion that Becraft's Rule 29 was doomed to failure as he does not understand substantive regulations.

                Becraft filed a Motion 29 under the idea that Circular E had not been published as any type of regulation, but what Becraft does not understand is that the Circular E was published inside of 4 substantive regulations, of which Singleton notes two of them.  You can have terms, other CFR sections, and other items that are NOT SUBSTANTIVE, BUT WHEN PUBLISHED INSIDE OF A SUBSTANTIVE REGULATION, THEY HAVE THE FORCE AND EFFECT OF LAW.  It is totally without simple logic to think that every "term", or Circular or non-substantive regulation published or not published as a substantive regulation could be excluded when inside of a substantive regulations and this would somehow  make it not applicable.  If this were true, all of the regulations would fail.  All of the statutes and regulations always have inside of them other code sections, terms, etc. that must be included [usually terms are in definitions or elsewhere] and all of them in their total inclusion of all "words" are part of the statute or regulation.  The true law of pre-civil war had code books with the complete bill, but indexed so that it could be easily found, not the "codification" process of today of terms and the dismantling the bills (sic) of today into many parts and then revised, obsoleted, deleted, etc.

                The two issues of the ORDER of Singleton that I will address are the substantive regulations that have Circular E  inside of them and court case that Singleton included that "It is the tax code itself, without  reference to regulations, that imposes the duty to file a tax return."  This cite is very troubling and seems in direct contradiction of Chrysler v. Brown, 441 U.S. 281 (1979) and other cases that clearly hold that only a substantive regulation (rule) as authorized by law can affect our rights and create any obligation.  See an earlier post on 5 U.S.C. § 552 (Congress's mandate" and  the IRS's agreement as found in 26 CFR § 601.702.

                First the substantive regulations on Circular E are found in the following substantive regulations, to wit: 

1.             26 CFR § 31.3402(b)-1

2.             26 CFR § 31.3402(c)-1

3.             26 CFR § 31.3402(h)(4)-1

4.       38 CFR § 36.4337

The first three are the most applicable to withholding in John’s case.  There are underlying issues that prove that we should not be here in the withholding area, but as the scope of this discussion is only if Circular E  can  be used on those that choose to be taxpayers and the pleading proffered by Becraft is fatally flawed.  Circular E is used inside of the substantive regulations and therefore has the force and effect of law in the Administrative State.

Next - Singleton's Quote on no Regulations required.

I validated the quote that Singleton used from United States v. Hicks, 947 F.2d 1356, 1360 (9th Cir. 1991) to see if it was correct as this had to be false, but it is quoted correctly.  What is interesting also is that the judge in Hicks is  citing the procedural CFR on who is required to do returns on income, but what is not disclosed is that this is procedural regulation and that the substantive regulations must found to demonstrate clearly who is required to do returns on income.   I have just about finished all of the substantive regulations under 1.6012-1 to 4 - good stuff!

 [5] Hicks' argument is meritless.   It confuses law with regulations with respect to such law.   It is the tax code itself, without reference to regulations, that imposes the duty to file a tax return.   See United States v. Bowers, 920 F.2d 220, 222 (4th Cir.1990) (upholding defendants' conviction under 26 U.S.C. Sec.  7201).   However, even if we suppose that the duty to file tax returns can be understood only with reference to regulations, the IRS has duly promulgated sufficient regulations, e.g., 26 C.F.R. Sec. 1.6011-1, 1.6012-1, to make that duty clear.   [Emphasis added]

Next is to check the source of the cite to see where the error is - Bowers.

                So in United States v. Bowers, 920 F.2d 220, 222 is the answer.  Contained also in this case is a great amount of valid information, but it must be read with an education of 5 U.S.C. § 552, 26 CFR § 601.702, Chrysler v. Brown, 441 U.S. 281, and that there are three types of regulations - substantive, interpretative and administrative.

                The actual quote from this case is as follows:

 The Bowers argue that the IRS has failed to publish the forms it requires to be used to report income and instructions for filling out those forms, and has not updated the publication of its organizational structure since 1974. Therefore, the Bowers assert, they cannot be prosecuted for failure to comply with these unpublished rules and policies.

 [1] The Bowers make a sizable leap of logic in their argument.   They were not convicted of "failure to submit Form 1040" or "failure to send their return to the proper regional service center."   They were convicted of evading income tax altogether.   The statutes themselves require the payment of the tax and the filing of a return.  26 U.S.C. Sec.  6012.   The contents of the required return are described, in a general way, right in the statute.   If a taxpayer had done his best to fashion and file a homemade return for want of notice of the IRS forms, and had paid the applicable tax, then 5 U.S.C. Sec.  552 might protect him from being "adversely affected" by nonpublication of a form.  [FN1]  However, the Bowers simply have evaded income taxes, and their duty to pay those taxes is manifest on the face of the statutes, without any resort to IRS rules, forms, or regulations. [FN2]  Cf. Welch v. United States, 750 F.2d 1101-11 (1st Cir.1985) (prosecution under 26 U.S.C. Sec.  6702 for filing frivolous return not barred by nonpublication of interpretive IRS guidelines).  [Emphasis added]

                The Bowers had the right idea, but unfortunately their defense was on a non-publication of a form - this is NOT REQUIRED - forms are in the area of interpretative and administrative regulations and are not substantive.  To get to the bottom of the ERROR, we must go the source of the problem in Welch v. United States, 750 F.2d 1101-11.

                I have highlighted parts of this case and you will clearly see that only interpretative regulations and administrative regulations are the issue, so the statement of no regulations is true if you limit the term of regulations to include only interpretative and administrative regulations with the exclusion of substantive regulations.

                This fraud by the courts and the average Joe would not have a clue if he didn't know of the three types of regulations and would just figure the courts were corrupt, which is true, but they intentionally make holdings that are pure BS when you finally get to the source.