2005 PDF - The True Nature of The Withholding Tax, and The 1040 Form Circa 1942 - The Informer

Against the Grain Press - The Informer
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The true nature of the withholding tax, and the 1040 Form circa 1942
IT IS CONSIDERED A LOAN TO THE GOVERNMENT AND IS APPLIED TO
TAXPAYERS AND NONTAXPAYERS ALIKE.
I have been privy to this material since Billie Murdock found this in late 1980's and take no
claim to finding this, but I am bringing it to you this October 2005. What I do want to say is
that this was known to the so called patriots in 1990 and for a few years thereafter. Yes, as
normal no "patriot" took this and ran with it and no group did either so it sat in my files for
all these years. I decided to give it another shot and put this on www.atgpress.com for all to
see again and fall back to sleep, as did the previous generation. The below was at the end of
Billie's find and she deserves the credit. This shows that the 1040 return is a claim for a
refund. So all you people using a refund claim form are using it the wrong way because of
the fraud the private IRS has put upon you as well as the Congress and is why the Congress
will not answer any questions put to them by various groups and certain men that have
asked. This is why their courts will never allow you to win. In case you cannot contact
Billie Murdock at the location listed, for I have not talked to her in 10 years and do not
know if she is alive or at the address. I do have the 147 page document and I also have the
Legislative history of the Current Tax Payment Act of 1943 all 28 pages.
The Informer
"DECLASSIFIED"
"WITHHOLDING.TAX,
HEARING BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON FINANCE,
UNITED STATES SENATE" and "LEGISLATIVE HISTORY OF THE CURRENT TAX
PAYMENT ACT OF 1943"
Patriot researcher
Billie Murdock,
P.O.
Box 151127,
Salt Lake City,UT 84115,
....in her never ending desire for the truth is uncovering many government violations of the
Constitution.
These two documents are a very small part of her many findings. As you read statements,
"mopping up purchasing power" and
"siphoning off purchasing power into the Treasury from a day to day", makes one take
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notice how far public serpents will go to

control our lives. You will find how Social Security was used to condition people for
withholding.
How it was decided to call withholding a "Victory Tax" to condition the public for accepting
the withholding tax system.
These documents have been transcribed from photo copies of micro
fiche for easier reading.
A true photo copy of the micro-fiche is available from Billie.
"An unconstitutional act is not law; it confers,
no right; it imposes no duties; affords no protection; .' it creates no office; it is in legal
contemplation, as inoperative as though it had never been passed."
Norton vs. Shelby County 118 US 425 p. 442
SUMMARY
OF THE WITHHOLDING TAX HEARING BEFORE A SUBCOMMITTEE OF THE
COMMITTEE ON FINANCE
UNITED STATES SENATE
SEVENTY-SEVENTH CONGRESS
SECOND SESSION
ON
DATA RELATIVE TO WITHHOLDING PROVISIONS OF THE 1942 REVENUE ACT
AUGUST 21 AND 22, 1942
CONTENTS
Statement of
Friedman, Milton, Division of Tax Research, Treasury Department
Hardy, Charles 0., of Brookings Institution,
Jacobstein, Meyer, of Brookings Institution
Paul, Randolph E., Treasury Department
Overview
Because the war effort resulted in increased production and employment, which caused a
sudden large influx of money into
circulation, the Federal Government and Federal
Reserve System had to fmd a method of "mopping up excess
purchasing power"
thereby control inflation and obtain immediate funds for the Treasury. Several plans were
put forth
before the House ways and Means Committee and the Senate Committee on
Finance to accomplish this purpose.
The following points were made by the Senators and those testifying before the committee:
I. The overall purpose was to obtain immediate money for the war effort to control inflation
and to get the income tax on a current basis instead of being one year behind.
2. To accomplish this goal, it was recognized that a scheme was needed to reach the largest
number of people.
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3. That the scheme, regardless of whether it was a "coupon," "stamp" or "withholding of

income tax at source," would constitute a "forced loan" [page 101] to the Federal
Government and it would apply to taxpayers and nontaxpayers alike. [page 104].
4. Where an individual had money withheld and ultimately no tax liability, the individual
would file an income tax return and that income tax return would constitute an automatic
claim for refund [page 141].
5. The proposed plan was an emergency war time measure.
HEARING EXCERPTS
Beginning at Page 99
STATEMENT OF MEYER JACOB STEIN, OF BROOKINGS INSTITUTION
Mr. Jacobstein. We were called * * *.
It is obvious that it is necessary to mop up the excess purchasing power of the
community, not only because of its effect
on the price situation but because the
Treasury needs the money and needs it quickly. Obviously if the Treasury can
collect
from the consumers as the purchases are made the Treasury has the use of those funds long
before it would
obtain them by the income-tax method.
Now, there are many ways, of course, of mopping up this surplus purchasing
power. * * * Page 100
Then, there is the withholding tax at the source based on pay rolls.
***
Senator Clark. Doctor, what this plan is, it is essentially a compulsory savings plan based
on sales tax methods, is it not?
Mr. .Jacobstein. I should say that is a fair description of it yes. It is the use of a sales tax
method without being a tax.
Senator Clark. So far as the impact on the public is concerned, it is precisely the same as a
sales tax, except you give the money back sometimes.
Mr. .Jacobstein. That is right. That is a very fair statement I think. Senator Danaher used
the word "self-assessment." If I buy a dollar necktie I pay $1.10 under his plan. '
***
* * * A withholding tax is usually withheld at the source. Here you withhold it not at the
manufacturer's end but at the retailer's end. You are using the retailer instead of the
manufacturer to siphon off several billions of dollars, depending upon the rate of the
assessment of a tax.
Page 101
* * * It may be that several systems can be used. Anyone of them might be very
useful to the Treasury in accomplishing this purpose. But... for siphoning off purchasing
power into the Treasury from day to day, or week to week, or month to month; and it has
that advantage.
Now, there is an aspect to this question which was not brought out in the original
memorandum which would make the scheme perhaps a little more palatable if certain
deductions were made by any method either by the withholding tax method or direct sales
tax method or by Senator Danaher's proposal, . . ..
STATEMENT OF CHARLES O. HARDY, OF BROOKINGS INSTITUTION
Mr. Hardy. First,... mainly for the purpose of providing an exemption from the tax or
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forced loan either one.

Now, as has been stated a moment ago, this is a forced loan * * *. It should be pointed
out, I think, that you can do the same thing with the mechanics of any other tax, that is,
under the income tax you can give out bonds or coupons redeemable in bonds instead of
giving receipts for the income tax. You can do that, as far as I can see, with any tax, for the
whole schedule of taxes.
I would like to say. . . that we have to bring about a readjustment of consumption in the
country to the amount of consumers' goods and services that we can spare the resources to
produce under war conditions. First, we have got to devote our productive energies to the
war. * * *
Page 102
* * * or you can "use the mechanism of the sales tax, as far as I can-see, by mopping
up the increased purchasing power that is created by the rising amount they receive in their
pay checks. * * * On the other hand, if the money is stored up, whether it is in the form of
these stamps or in the form where people haven't spent it because they have had no way to
spend it, in either case if it is too large a proportion you are going to have the problem,
whenever you do turn it loose, that you have now in the other case, namely, of having a lot
more purchasing power than you have goods and services to make it good with.
That is the answer, I think, to the question that might be raised as to why not carry
this principle through and apply it to income tax, corporation tax, and everything else.
* * * Obviously, this has the advantage that this definitely sews up the purchasing
power in such a way that it cannot be released until we discover the proper period to release
it.
Page 103
* * * I think it has a great advantage over the deficient spending program. This
program just postpones the problem of administration, in deciding how much purchasing
power is available to release and to what extent it will create the old wartime inflation over
again.
Senator Danaher. Let me ask you this question: Considering the withholding tax, . . .
simply the Treasury withholds it currently and applies the proceeds against the tax due in a
given year. . ..
Mr. Hardy. The deduction from salaries and interest, and so on, at the source?
Senator Danaher. Yes.
Mr. Hardy. Yes
Senator Danaher. That is a currently applied method of withdrawing so much of the
consumer purchasing power as is represented by the tax collected or withheld.
Mr. Hardy. That is right.
Senator Danaher. And then applied as against the tax due.
Mr. Hardy. Yes
***
The withholding tax provision has the effect of withholding purchasing power at the
time the income is realized rather than a year hence through the income tax structure.
Senator Danaher. And if it were in effect only 1 year it would apply only 1 year?
Mr. Hardy. I assume so.
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Senator Danaher. Yes. Whereas this proposal is a continuing thing.

***
Page 104
Mr. Hardy. It seems to me the essential difference is that the withholding tax plan applies
at the point of receipt of income, and this applies at the point of expenditure of income.
Senator Danaher. Of course, you withhold not only from taxpayers but nontaxpayers.
(Emphasis added)
Mr. Hardy. Yes. * * *
Page 107
***
Some people that I talked to about this plan, Federal Reserve people, have been
rather favorable to the idea. * * *
Page 108
Mr. Jacobstein. Don't you want to add that Mr. Selko pointed out that such difficulties as
are encountered in the States are, partially at least, overcome when you have a uniform
Federal tax?
* * * Where you have a uniform tax all over the country by one administration, the Federal
Government, it is easier to administer than a sum total of 48 States. Now that was Mr.
Selko's conclusion.
Page 141
STATEMENT OF MILTON FRIEDMAN, DIVISION OF TAX RESEARCH,
TREASURY DEPARTMENT
Senator Danaher. I have only one other thought on that point. In the event of withholding
from the owner of stock and no taxes due ultimately, where does he get his refund?
Mr. Friedman. You thinking of a corporation or an individual?
Senator Danaher. I am talking about an individual.
Mr. Friedman. An individual will file an income tax return, and that income tax return
will constitute an automatic claim for refund.
Emphasis added
End Page 147
The above information was scanned from:

DECLASSIFIED
SEE EXCHANGE & GIFT DIV.
DECLASSIFICATION FILE NO100 [
[CONFIDENTIAL COMMITTEE PRINT]

_____________________________________________________________________
WITHHOLDING TAX
_____________________________________________________________
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HEARING
BEFORE A
SUBCOMMITTEE OF THE
COMMITTEE ON FINANCE
UNITED SENATE
SEVENTY-SEVENTH CONGRESS
SECOND SESSION
ON
DATA RELATIVE TO WITHHOLDING PROVISIONS

OF THE 1942 REVENUE ACT
________________________
AUGUST 21 AND 22, 1942
___________________________
Printed for the Use of the Committee on Finance
UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON 1942
[ATG regrets being unable to post the original above page, which is in our possession.]
4/2/2013 10:36 PM

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Against the Grain Press - The Informer

Against the Grain Press - The Informer

notice how far public serpents will go to

Against the Grain Press - The Informer

3. That the scheme, regardless of whether it was a "coupon," "stamp" or "withholding of

Against the Grain Press - The Informer

forced loan either one.

Against the Grain Press - The Informer

Senator Danaher. Yes. Whereas this proposal is a continuing thing.

The above information was scanned from:

[CONFIDENTIAL COMMITTEE PRINT]

Against the Grain Press - The Informer

DATA RELATIVE TO WITHHOLDING PROVISIONS

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