Friday, December 13, 2013

IRS Targeting: Round Two


Dec. 12, 2013 7:20 p.m. ET

President Obama keeps claiming that he had no knowledge of the Internal Revenue Service's abusive muzzling of conservative groups. That line is hard to swallow given that his Treasury and IRS are back at it—this time in broad daylight.

In the media blackout of Thanksgiving week, the Treasury Department dumped a new proposal to govern the political activity of 501(c)(4) groups. The administration claims this rule is needed to clarify confusing tax laws. Hardly. The rule is the IRS's new targeting program—only this time systematic, more effective, and with the force of law.

That this rule was meant to crack down on the White House's political opponents was never in doubt. What is new is the growing concern by House Ways and Means Committee investigators that the regulation was reverse-engineered—designed to isolate and shut down the same tea party groups victimized in the first targeting round. Treasury appears to have combed through those tea party applications, compiled all the groups' main activities, and then restricted those activities in the new rule.
Enlarge Image
Chad Crowe

"The committee has reviewed thousands of tax exempt applications," says House Ways & Means Chairman Dave Camp. "The new regulation so closely mirrors the abused tea-party group applications, it leads me to question if this new proposed regulation is simply another form of targeting."

Here's how it works. To get or keep tax-exempt status, 501(c)(4) organizations must devote a majority of their work to their "primary" social-welfare purpose. Most tea party groups were set up with a primary purpose of educating Americans on pressing problems—the size of government, the erosion of the Constitution—and did so mainly via nonpartisan voter guides, speakers forums, pamphlets or voter-registration drives.

What the proposed Treasury/IRS regulation would do is to re-categorize all these efforts as "political activity"—thereby making it all but impossible for tea party groups to qualify for 501(c)(4) status. Say an outfit's primary purpose is educating voters on our unsustainable debt, which it does mainly with a guide explaining the problem and politicians' voting records. Under the new rule, that guide is now "political activity" (rather than "social welfare"), which likely loses the group tax-exempt status.

The rule, in other words, is not designed to provide helpful "guidance" on allowable activities. It was designed, rather, as Mr. Camp explains, "to put tea party groups out of business."

What makes this targeting more obvious is that the Obama Treasury rule only applies to 501(c)(4) groups. The ultra-liberal League of Women Voters Education Fund is registered as a 501(c)(3)—one of those "charities" supposedly held to the strictest IRS standards on politicking. Yet it brags on its website that it holds "candidate debates and forums," and that its "educational activities" include "understanding candidate views and ballot initiatives."

The League will continue to be able to do its voter guides and registrations and candidate forums. Yet under this new rule, any conservative social-welfare organization that attempts to do the same will likely lose its tax-exempt status. Nor does the new rule apply the biggest spenders of all in politics—unions, which are registered as 501(c)(5)s. The only category muzzled is the one recently flooded by conservative groups that Democrats fear in the 2014 election.

Consider the timing. This "proposed guidance"—while technically pending public comment—puts conservative groups on immediate notice that it could be enforced at any moment. It is clearly designed to have a chilling effect on any group gearing up for next year's midterms, just as the first round of targeting was designed to dampen conservative participation in the 2010 and 2012 elections.

Democrats are daily directing government against their political opponents—via Congress, the SEC, the FEC. Yet IRS Acting Commissioner Danny Werfel wants Americans to think this latest IRS rule is just about providing "clarity." And the White House continues to insist that it was unaware of the previous targeting.

The political insult is that President Obama is using his new targeting rule to wiggle out of liability for the last round. The same president who in May was "outraged" by the IRS's actions now says it was all just some confusion over tax law (which his new rule fixes). He told Chris Matthews last week that the media had hyped what was a few poor IRS souls in Cincinnati who were "trying to streamline what is a difficult law to interpret . . . And they've got a list, and suddenly everybody's outraged."

Everybody was outraged to discover the IRS was secretly targeting the president's political opponents. They might be more outraged that the White House is now using the IRS to do the same thing in the brazen light of day.

Write to

Wednesday, December 11, 2013

72 Types of Americans that Are Considered “Potential Terrorists”

By Michael Snyder, on August 26, 2013


Are you a conservative, a libertarian, a Christian or a gun owner?  Are you opposed to abortion, globalism, Communism, illegal immigration, the United Nations or the New World Order?  Do you believe in conspiracy theories, do you believe that we are living in the “end times” or do you ever visit alternative news websites (such as this one)?  If you answered yes to any of those questions, you are a “potential terrorist” according to official U.S. government documents.  At one time, the term “terrorist” was used very narrowly.  The government applied that label to people like Osama bin Laden and other Islamic jihadists.  But now the Obama administration is
removing all references to Islam from terror training materials, and instead the term “terrorist” is being applied to large groups of American citizens.  And if you are a “terrorist”, that means that you have no rights and the government can treat you just like it treats the terrorists that are being held at Guantanamo Bay.  So if you belong to a group of people that is now being referred to as “potential terrorists”, please don’t take it as a joke.  The first step to persecuting any group of people is to demonize them.  And right now large groups of peaceful, law-abiding citizens are being ruthlessly demonized.

Below is a list of 72 types of Americans that are considered to be “extremists” and “potential terrorists” in official U.S. government documents.  To see the original source document for each point, just click on the link.  As you can see, this list covers most of the country…

1. Those that talk about “individual liberties”

Those that advocate for states’ rights

Those that want “to make the world a better place”

“The colonists who sought to free themselves from British rule”

Those that are interested in “defeating the Communists”

Those that believe “that the interests of one’s own nation are separate from the interests of other nations or the common interest of all nations”

Anyone that holds a “political ideology that considers the state to be unnecessary, harmful,or undesirable”

Anyone that possesses an “intolerance toward other religions”

Those that “take action to fight against the exploitation of the environment and/or animals”




“The Patriot Movement”

“Opposition to equal rights for gays and lesbians”

Members of the Family Research Council

Members of the American Family Association

Those that believe that Mexico, Canada and the United States “are secretly planning to merge into a European Union-like entity that will be known as the ‘North American Union’”

Members of the American Border Patrol/American Patrol

Members of the Federation for American Immigration Reform

Members of the Tennessee Freedom Coalition

Members of the Christian Action Network

Anyone that is “opposed to the New World Order”

Anyone that is engaged in “conspiracy theorizing”

Anyone that is opposed to Agenda 21

Anyone that is concerned about FEMA camps

Anyone that “fears impending gun control or weapons confiscations”

The militia movement

The sovereign citizen movement

Those that “don’t think they should have to pay taxes”

Anyone that “complains about bias”

Anyone that “believes in government conspiracies to the point of paranoia”

Anyone that “is frustrated with mainstream ideologies”

Anyone that “visits extremist websites/blogs”

Anyone that “establishes website/blog to display extremist views”

Anyone that “attends rallies for extremist causes”

Anyone that “exhibits extreme religious intolerance”

Anyone that “is personally connected with a grievance”

Anyone that “suddenly acquires weapons”

Anyone that “organizes protests inspired by extremist ideology”

“Militia or unorganized militia”

“General right-wing extremist”

Citizens that have “bumper stickers” that are patriotic or anti-U.N.

Those that refer to an “Army of God”

Those that are “fiercely nationalistic (as opposed to universal and international in orientation)”

Those that are “anti-global”

Those that are “suspicious of centralized federal authority”

Those that are “reverent of individual liberty”

Those that “believe in conspiracy theories”

Those that have “a belief that one’s personal and/or national ‘way of life’ is under attack”

Those that possess “a belief in the need to be prepared for an attack either by participating in paramilitary preparations and training or survivalism”

Those that would “impose strict religious tenets or laws on society (fundamentalists)”

Those that would “insert religion into the political sphere”

Anyone that would “seek to politicize religion”

Those that have “supported political movements for autonomy”

Anyone that is “anti-abortion”

Anyone that is “anti-Catholic”

Anyone that is “anti-nuclear”

“Rightwing extremists”

“Returning veterans”

Those concerned about “illegal immigration”

Those that “believe in the right to bear arms”

Anyone that is engaged in “ammunition stockpiling”

Anyone that exhibits “fear of Communist regimes”

“Anti-abortion activists”

Those that are against illegal immigration

Those that talk about “the New World Order” in a “derogatory” manner

Those that have a negative view of the United Nations

Those that are opposed “to the collection of federal income taxes”

Those that supported former presidential candidates Ron Paul, Chuck Baldwin and Bob Barr

Those that display the Gadsden Flag, for example, “Don’t Tread On Me”

Those that believe in “end times” prophecies

Evangelical Christians

The groups of people in the list above are considered “problems” that need to be dealt with.  In some of the documents referenced above, members of the military are specifically warned not to have anything to do with such groups.

We are moving into a very dangerous time in American history.  You can now be considered a “potential terrorist” just because of your religious or political beliefs.  Free speech is becoming a thing of the past, and we are rapidly becoming an Orwellian society that is the exact opposite of what our founding fathers intended.

Please pray for the United States of America.  We definitely need it.

About the author:
Michael T. Snyder is a former Washington D.C. attorney who now publishes The Truth.  His new thriller entitled “The Beginning Of The End” is now available on

Tuesday, December 3, 2013

The Danger of Internet Case Citations


We received an online e-book from a member of the Tax Response Team that had wonderful case law that we just found incredibly and wondered to ourselves why others hadn’t argued this in court. It seemed if it was so on-point, they should have argued and won. But such is not the case.

Exhibit 1

Here’s a case that spoke to the requirements of tax regulations and how important they were. Here’s the original citation as we found it many times on the Internet.

“For Federal tax purposes, the Federal Regulations govern. Lyeth v. Hoey, 1938, 305 U.S. 188, 59 S.Ct. 155, 83 L.Ed. 119.

First, by noting that the case citation uses the US reporter we can think that the case is a Supreme Court case. However, the year of the decision and the court it was decided in is missing. Given these two key features that were missing, we decided to exercise due diligence and check for that quote in the Lyeth v. Hoey case on Google Scholar, and we did not find it! At once we figured out this was a bum case and couldn’t be used for the proposition it was supposed to be used for. In fact, we read the case decision and didn’t understand how tax regulations fit into it at all.

But there’s a great feature of Google Scholar and that is, how it’s cited, but even there, we couldn’t find the case or the quotation. But a little more digging on the Internet finally revealed the citation. What follows below is a more complete citation from the case.

“For Federal tax purposes, the Federal Regulations govern. Lyeth v. Hoey, 1938, 305 U.S. 188, 59 S.Ct. 155, 83 L.Ed. 119. But see Gelb v. Commissioner of Internal Revenue, 2 Cir. 1962, 298 F.2d 544, 551.” Dodd v. United States, 223 F.Supp 785, 787 (D. New Jersey 1963)

Ah ha! This case is really a federal district court case out of New Jersey. But see the context in which the quotation appears and you’ll get an appreciation for what the case is about. Let’s look at the full paragraph where we found this quote.

The construction of the Internal Revenue law is not to be determined by local law but is a Federal question. However, State law may control when the Federal taxing Act, by its express language or necessary implication, makes its operation dependent upon State law. For Federal tax purposes, the Federal Regulations govern. Lyeth v. Hoey, 1938, 305 U.S. 188, 59 S.Ct. 155, 83 L.Ed. 119. But see Gelb v. Commissioner of Internal Revenue, 2 Cir. 1962, 298 F.2d 544, 551. The Commissioner's determination of deficiency in tax bears a presumption of correctness, and the burden of proof is upon the taxpayer to show error therein. Hoffman v. Commissioner of Internal Revenue, 3 Cir. 1962, 298 F.2d 784.

Exhibit 2

Our second case deals with purported withholding. This is important because Mr. Hendrickson uses this case to show that withholding isn’t what it appears. Here’s how Mr. Hendrickson cited the case:

“[Withheld or paid-in amounts] are, as it were, payments in escrow. They are set aside, as we have noted, in special suspense accounts established for depositing money received when no assessment is then outstanding against the taxpayer. The receipt by the Government of moneys under such an arrangement carries no more significance than would the giving of a surety bond. Money in these accounts is held not as taxes duly collected are held but as a deposit made in the nature of a cash bond for the payment of taxes thereafter found to be due.” Rosenman v. United States, 323 US 658 (1945)

Let’s point out two problems right off the top. The first is that while the case citation properly states the start page within the US Reporter, pg. 658, it doesn’t state what page his citation is found on. The other point is a minor point but Supreme Court cases are usually reported on by as many as 3 different reporters: the US Reporter, the Federal Reporter, and the Supreme Court reporter.

“[Withheld or paid-in amounts] are, as it were, payments in escrow. They are set aside, as we have noted, in special suspense accounts established for depositing money received when no assessment is then outstanding against the taxpayer. The receipt by the Government of moneys under such an arrangement carries no more significance than would the giving of a surety bond. Money in these accounts is held not as taxes duly collected are held but as a deposit made in the nature of a cash bond for the payment of taxes thereafter found to be due.” Rosenman v. United States, 323 US 658, 65 S. Ct. 536, 89 L. Ed. 535 (1945)

So, according to Mr. Hendrickson, withholding really isn't a tax taken from wages but is, instead, an amount paid in and treated as escrow. But we note that Mr. Hendrickson put brackets around the opening part of the paragraph. So, we need to look at the proper case citation and see the entire paragraph where this quote is found to see it in context.

“But the Government contends "payment of such tax" was made on December 24, 1934, when petitioners transferred to the Collector a check for $120,000. This stopped the running of penalties and interest, says the Government, and therefore is to be treated as a payment by the parties. But on December 24, 1934, the taxpayer did not discharge what he deemed a liability nor pay one that was asserted. There was merely an interim arrangement to cover whatever contingencies the future might define. The tax obligation did not become defined until April 1938. And this is the practical construction which the Government has placed upon such arrangements. The Government does not consider such advances of estimated taxes as tax payments. They are, as it were, payments in escrow. They are set aside, as we have noted, in special suspense accounts established for depositing money received when no assessment is then outstanding against the taxpayer. The receipt by the Government of moneys under such an arrangement carries no more significance than would the giving of a surety bond. Money in these accounts is held not as taxes duly collected are held but as a deposit made in the nature of a cash bond for the payment of taxes thereafter found to be due.” Rosenman v. United States, 323 US 658, 65 S. Ct. 536, 89 L. Ed. 535 (1945)

Wait a minute! The substituted text by Mr. Hendrickson is really dealing with estimated taxes, not withholding! He has completely misrepresented the case, and not only that, the case has nothing to do with withholding at all. It's about an estate where an estimated tax was paid out of the estate to cover any possible taxes.


Whenever you find these Internet case cites, check the case for context and that the citation is accurate to what is being purported.

Thursday, November 28, 2013

Tests for Distinguishing Between Civil and Criminal Contempt—Purging

US Department of Justice Criminal Tax Manual 757

Because the primary aim of a criminal contempt action is vindication of the authority of the court and punishment for disobedience already accomplished, the general rule is that purging of contempt is not a complete defense in a criminal contempt action. Consequently, a person found guilty of criminal contempt may be sentenced to a fixed and definite term of imprisonment, or be required to pay an unconditional fine. See
United States v. Shipp, 203 U.S. 563 (1906); Skinner v. White, 505 F.2d 685, 689 (5th Cir. 1974).

In a civil contempt action, the issue of purging is determined by whether the action is coercive or compensatory in nature. A "coercive civil" contempt action is one wherein the principal object is respondent's compliance with the court decree. This is to be contrasted with a "compensatory civil" contempt action wherein the principal object is the receipt of an award or compensation. The contemnor in a coercive civil contempt action possesses the "keys to his own cell" since he may not be sentenced to a fixed or definite term of imprisonment or subjected to an unconditional fine. See
Penfield Co. v. SEC, 330 U.S. 585, 595 (1947); Gompers v. Bucks Stove and Range Co., 221 U.S. 418, 441-42 (1911); Duell v. Duell, 178 F.2d 683, 685 (D.C.Cir. 1949); Parker v. United States, 153 F.2d 66, 70 (1st Cir. 1946). An unconditional award or fine may, however, be imposed in a compensatory civil contempt action. See McComb v. Jacksonville Paper Co., 336 U.S. 187, 191 (1949); United States v. United Mine Workers of America, 330 U.S. 258, 303-04 (1947); Backo v. Local 281, United Brothers of Carpenters and Joiners, 438 F.2d 176, 182 (2d Cir. 1970), cert. denied, 404 U.S. 858 (1971).

Purging Contempt: Eliminating the Distinction Between Civil and Criminal Contempt

Paul A. Grote
Washington University Law Review

Read the document here:

Thursday, November 21, 2013

Federal Jurisdiction Is Always Limited

Federal Jurisdiction Is Always Limited
Federal jurisdiction is always limited by law. As creatures of the law, federal courts exist, and possess specific authorities only by statutory grants of jurisdiction. If no federal statute specifically grants a court the power to decide an issue, the court does not and cannot have such power.
The U.S. Tax Court is a federal court of limited and specific jurisdiction.
Here is an excellent summary from a “Motion to Dismiss for lack of subject matter jurisdiction” (over Subtitle C Employer Status). There’s a link to the motion below:
Tax Court Jurisdiction
1. The Tax Court is a court of “very narrow” limited jurisdiction. (Clapp v. CIR, 875 F.2d 1396, 1399 (9th Cir.1989)
2. The Court may exercise its jurisdiction only to the extent authorized by Congress. (
Naftel v. CIR, 85 T.C. 527, 529 (1985); CIR v. Ewing, 439 F. 3d 1009 (9th Cir. 2006)).
3. The Court “may not use general equitable powers to expand its jurisdictional grant beyond this limited Congressional authorization.”(
Estate of Branson v. CIR, 264 F.3d 904, 908 (9th Cir.2001); see also American Fire & Casualty Co. v. Finn, 341 U.S. 6,(1951))
4.  And further, “It is to be presumed that a cause lies outside this limited jurisdiction and the burden of establishing the contrary rests upon the party asserting jurisdiction.” (
Kokkonen v. Guardian Life Ins. Co. of America, 611 U.S. 375, 377 (1994); citing Turner v. Bank of North-America, 4 Dall. 8, 11 (1799) and McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 182-183 (1936))
5. And finally, the issue of Tax Court jurisdiction is to be resolved in the same manner as for an Article III court. (See
Anthony v. Commissioner, 66 T.C. 367 (1976) (Article III standing principles apply to Tax Court)
Good summary and a good motion.
The Tax Court denied the motion without comment or requiring Respondent to reply. No facts or statute were ever placed in the record to prove jurisdiction and the Court ruled against the petitioner.

Read the Motion to Dismiss here:
Motion to Dismiss for Lack of Subject Matter Jurisdiction, Subtitle C Employer Status

Thursday, November 14, 2013

What Doreen Hendrickson Should Have Argued

B. Dooger, November 14, 2013

I've been meaning to weigh in on this for some time. It occurs to me that Doreen's contempt charge could have been avoided.

Given that case law establishes that signing a tax return is testimonial in nature she could have asked IRS/DOJ if her signing of the return could be used against her in a criminal proceeding or be used as a link in a chain of evidence to be used against her in a criminal proceeding. Having thus established the predicate condition of harm, she then could have declined to sign said return by stating that she would not waive any of her rights. Thus she establishes her fifth amendment  privilege not to be compelled to testify against herself.

The case law on the testimonial nature of signing a return is good. The case law on how to establish the predicate condition of risk for implementing fifth amendment privilege is well established. It is equally well established that once a contempt is purged the court wants for jurisdiction or must consider the court order impossible, under the circumstances, to comply with and thus deem her actions compliance.

She could have done this ANYTIME thus purging her contempt and DEPRIVING THE COURT OF CRIMINAL JURISDICTION IN THE MATTER.

B. Dodger

Wednesday, November 13, 2013

Peter Hendrickson's wife Doreen escapes conviction for criminal contempt of court

November 13, 2013
Bob Hurt

As you know, the a hung jury prevented the court from convicting Doreen Hendrickson for contempt of court.  I wrongly predicted below that she might spend 6 months in prison for criminal contempt.  The DOJ and Pete briefed the court on their versions of reality before the trial.  The DOJ said the Jury could not consider the lawfulness of the judge's order to Doreen that she must file returns (and sign under penalty of perjury what she considered as a lie), Doreen showed a ton of proof that lawfulness and willfulness both matter and the jury must consider them.

See attached Doreen affidavit and briefs.  I believe you will find Doreen's brief HIGHLY instructive.  In it you will see citations proving the right of the jury to determine law as well as fact.

Here's the thread between me and Pete Hendrickson.

Bob Wrote:

Well, I just did the same thing, responded before reading a more recent message.  Sorry.  Reading the affidavit, I wonder why you don't hand the following to the judge, all filled out (targeting her), next time in court, and demand a signature to prove you reported the crime, under 18 USC 4 misprision of felony:

See an example of their use here:

See more forms here:

Might Doreen point out that the judge has ordered her to violate 18 USC 1001 by lying in writing to a government employ in performance of duty?

Might Doreen complain that the judge violated 18 USC 1018, false certification (could that  apply to a false court order?)?

How about 18 USC 1346.  Did the judge commit honest services fraud?

Could Doreen sue the judge for injunction/declaratory judgment, win, and get the court to force the judge to pay attorney fees and court costs?

Pete Wrote:
You didn't hurt me, you hurt my wife with your spreading of this DOJ smear and your speculation as to the outcome.

Further, I DID write back with a cogent answer pointing out that the DOJ is attacking my wife by deliberately misrepresenting CtC; and the fact that the court DID NOT order anyone to not file CtC-educated returns-- instead, it carefully enjoined returns which are based on something NOT FOUND in CtC, even while making reference to CtC, in hopes that those who don't read such orders carefully, or haven't actually read CtC, will make the mistake of thinking that the orders enjoined actual CtC-educated returns.

All that is without getting to the broader issues, a pretty good job of which was done by the letter to Sheriff Mack on which I copied you.

The real question is, why are you helping spread fear-- that is, helping the DOJ with accomplishing the goal for which bogus prosecution efforts like this are launched? How do you expect anyone to stand up to corruption if those who do are not celebrated and supported?

Bob Hurt wrote on 6/10/2013

I didn't spread misrepresentations, Pete.  I explained the fact that Doreen got indicted and arrested, and why.  I said NOTHING hurtful.  I just reported what happened and asked whether the grand jury will indict YOU again.  I hoped you'd write back some cogent answer and explain how, if the DOJ has successfully attacked you and your wife for using your CTC method, and the court ruled related returns false and ordered you not to make them and to amend prior returns, others who use the method should expect the DOJ to leave them alone.

Will you answer that?

I don't mean to hurt you.  I mean to save as many as possible from hurt, UNTIL some actual effective rebellion starts.  Then EVERYONE will get hurt, unavoidably.


On 6/10/2013 2:12 PM, Pete Hendrickson wrote:
Why did you send out such a hurtful thing, and help the DOJ do its dirty work by spreading their misrepresentations and their efforts to intimidate people?

-------- Original Message --------


Re: Peter Hendrickson's wife Doreen indicted for criminal contempt of court


Mon, 10 Jun 2013 13:02:54 -0400


Pete Hendrickson


Bob Hurt


The court DID NOT order Doreen "not to file using the CtC method". Per the indictment, it ordered her to not file returns based on the ridiculous notions that: " “only federal, state or local government workers are liable for the payment of federal income tax or subject to the withholding of federal income, social security and Medicare taxes from their wages under the internal revenue laws”. Such things not only do not appear in CtC, but CtC makes clear how wrong they are. Doreen was ordered to not do something she never had done, nor ever would do. CtC was simply misrepresented by the government in order to provide a pretext for claiming that a court had declared something in it to be frivolous.

Here is a good take on Doreen's indictment sent to Sheriff Richard Mack by someone else:

Dear Sheriff Mack,

You and I spoke a couple of years back, and you were kind enough to send me your excellent book on The County Sheriff.  I have received your newsletters and have watched your campaign, and efforts on behalf of other worthy candidates, with great interest and renewed hope.  Now, I am coming to you with a plea for help and ideas on a matter that is likely to be somewhat foreign to you at first, but which you would no doubt, once educated about it, take a great interest in and find to be a familiar cause.

Peter Hendrickson wrote a book, a copy of which is attached, on the nature of the income tax as a lawful excise on the gains derived from the exercise of various types of privilege entitling the federal government to a "piece of its own action." It is because these receipts derive from distinguished activities connected to privilege (as opposed to un-distinguished activities of common right) that the income tax is a constitutional excise and is not what many believe it to be -- some new species of tax that is in substance an unapportioned direct tax.

Some years back, Peter and his wife filed returns in which they rebutted the reports of third party payers that payments to them were of the distinguished kind; they tussled with the IRS, and the IRS finally refunded their property, including employment taxes.  Later the government sued them, claiming that the refund was a mistake, and that the Hendricksons owed the government the money (even though its own certificates of assessment state otherwise).  In that civil case, the court did something unprecedented (at least in my knowledge of this country's history and jurisprudence):  the court ordered Mrs. Hendrickson to sign an amended return dictated by the government as if it were her own, without any indication on the form that her signing was coerced, or go to jail for contempt. The court insisted that she agree with what she knew to be erroneous information returns, and sign as if she found them to be correct.  (Note, that if the government actually found the returns to be false or fraudulent, it has a statutory duty to file competing returns under 26 U.S.C. section 6020(b), something it has never chosen to do in this case -- so why force the woman to recant her rebuttals and officially appear to toe the party line? For some reason, her repudiation of her husband's work is what is being sought here.)  At first, the court stated (three or four times), in an apparent deference to the First Amendment, that she was allowed to file an affidavit with it, describing her disagreement.  Months later, at a hearing that I attended, in an apparent attempt to accommodate the IRS who wanted a "processable" return in order to create the pretext of a debt owed to the government, the judge recharacterized her previous ruling to say that whatever else was filed had to be filed separately from the return. 

Mrs. Hendrickson signed the return that had been prepared by the government and submitted it to government counsel along with her affidavit, which she also filed with the court with the return as an exhibit. That was in January of 2011. A copy of Mrs. Hendrickson's affidavit is attached.

Yesterday, Mrs. Hendrickson was arrested and arraigned for criminal contempt.

Before forming any opinion as to whether what is being done to this family is lawful or a flagrant violation of our Constitution, please read what I have attached.  Then consider whether a court's ruling ordering someone to swear to a statement she believes to be false can ever be considered to be enforceable in this country.  Please consider whether the County Sheriff should allow this woman and her family to be arrested and prosecuted for a non-crime, and be forced to state under oath something that clearly serves the state but that is contrary to what she believes to be required of her under the law.

After reading the book, please re-read what I've said above about why she is being charged, and then ask yourself if there is something that you can do to bring this injustice to light as the immoral, unlawful, and downright un-American activity that I believe it is.  With your connections and influence among the county sheriffs of this country, and as a public servant of uncompromising integrity yourself, perhaps you can help to bring some pressure to bear, or at least a positive influence, on more than just one deputy of the Oakland County, Michigan Sheriff's Office, to act in accordance with the law and the Constitution they swore to uphold.  Then consider writing about this to your vast mailing list so that more people may see the shameful truth of this matter.

Thank you for your time and thoughtful consideration.



On 6/10/2013 1:19 AM, Bob Hurt wrote:
I have attached a searchable, compressed version of Doreen Hendrickson's indictment.  The indictment story goes like this:
  • For 2002 and 2003 Doreen and Peter Hendrickson filed tax returns. They claimed zero income.  They asked for and recrived refunds in excess of $10,000 each year.  They had followed the method Peter recommended in his book Cracking the Code (CTC).
  • In 2007 a Michigan US District Court ordered Doreen not to file any more frivolous returns using the CTC method, and to file an amended return within 30 days for the years 2002 and 2003 in Michigan. 
  • Doreen ignored the court's orders. 
    • She never filed the amended returns for 2002 and 2003.
    • In 2009 she filed a 1040EZ tax return for 2008, falsely claiming zero income.
  • The Grand Jury claimed she violated 18 USC 401(3) (criminal contempt for disobedience)
I imagine Doreen will spend at least six months in prison.

Department of Justice
Office of Public Affairs


Friday, June 7, 2013

Michigan Woman Arrested for Criminal Contempt

Doreen Hendrickson of Commerce Township, Mich., was arrested today following an indictment by a federal grand jury for criminal contempt, the Justice Department and Internal Revenue Service (IRS) announced.
 Hendrickson and her husband, Peter Hendrickson, filed tax returns for 2002 and 2003 on which they claimed more than $20,000 in fraudulent tax refunds. These returns were based on the frivolous argument set forth in Peter Hendrickson’s book, Cracking the Code, that only federal, state and local government employees are liable for the payment of income taxes. In May 2007, as part of a lawsuit against the Hendricksons filed by the department’s Tax Division, U.S. District Judge Nancy G. Edmunds in Detroit entered a permanent injunction that barred the Hendricksons from filing additional false tax returns. Judge Edmunds also ordered the Hendricksons to file amended 2002 and 2003 returns. According to the indictment, Doreen Hendrickson violated this injunction by failing to file amended 2002 and 2003 tax returns and by filing a false 2008 tax return that was based on the arguments in her husband’s book.
 An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
 This case was investigated and is being prosecuted by Trial Attorneys Melissa S. Siskind and Jeffrey B. Bender of the Tax Division, with the assistance of IRS-Criminal Investigation. 
Tax Division

I wonder whether the Grand Jury will indict Peter again.  Has he violated any of the court's orders?

If Peter and Doreen faced persecution for using his CTC recommendations, how will other users escape trouble?

Read about
Doreen and Peter at



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- GovernmentTrialBrief.pdf, 225.4 KB
- PostTrialBriefResponse.pdf, 109 KB

Tuesday, November 12, 2013

Businessman owes IRS nothing, still prison bound

By Randy Wallace, Investigative Reporter - bio



Before the IRS came knocking Michael and Vicki Quiel lived a charmed life.

High school sweethearts, married for 30 years.

Michael was in the navy, Vicki's late father was also a military man.

But the couples' respect and trust for the government is forever changed,

"You just don't do this to people is what I thought," Vicki Quiel said.

The reason behind the couple's recent trust issues with the government?

Three letters, I.R.S.

"I was having a real hard time imagining that you could go to jail when you don't owe taxes," Vicki said.

Even though a 6 week trial proved Michael Quiel owed the I.R.S. nothing , the way it stands now he must spend 10 months behind bars.

"It's not what it did to me it's the people around me," Michael Quiel said while chocking back tears. "It's real hard."

Before all the IRS press releases tarnished his reputation, Michael Quiel was known in Phoenix as a prominent businessman.

He donated thousands to charities, even taking a special interest in a young man's debilitating spinal cord injury.

But last year all of Quiel's success was overshadowed by the IRS.'s highly touted criminal case against him.

"I would never wish this on anybody actually," Vicki Quiel said.

In the high profile IRS prosecution the government accused Quiel of being involved in secret foreign bank accounts, willful million dollar tax evasion and multiple conspiracies.

"Anybody that didn't know Mr. Quiel and who read the IRS propaganda would believe he was a horrible human being," said Houston attorney Michael Minns.

"I invest in a lot of different companies,” Quiel said. "I'm usually the first investor in the door."

Upon the urging of his tax attorney Christopher Rusch, Quiel says he opened up swiss bank accounts.

"He starts seeing news reports that if you have any involvement with swiss bank you're suppose to come forward," Minns said.

Those reports prompted Quiel to seek advice from Rusch.

He says the tax attorney advised him to do nothing, not even submit an IRS form that's required for anyone who has more than 10 thousand dollars in a foreign country account.

"Most people did not even know this form existed," Minns said. "Most CPA's didn't know it existed."

"Everything was represented to me in the beginning as being legal," Quiel said. "So I didn't think in the beginning it was any big deal."

Even if charges were filed Quiel said his tax attorney assured him he could turn himself in and avoid being arrested.

But on a bright Sunday afternoon while playing golf at his country club Quiel learned that was all a lie.

"The IRS agents showed up in the clubhouse showing badges and guns," Quiel said.

"There was no way he was going to get out until Monday," Vicki Quiel said.

His weekend arrest meant Quiel had to spend at least one night in the county jail.

"There were people bouncing off the walls," Quiel said. "It was crazy."

The Quiels soon discovered crazy had come to stay.

"Finding out about it was hard in the first place," Vicki Quiel said. "But going through the trial was probably the worst it had a huge affect on me and my family, mostly the kids."

One of the most shocking things to emerge from the 6 week federal trial was Christopher Rusch's role.

Remember he was Quiel's tax attorney.

Ever heard the term attorney client privilege?

"In this case it went into the trash can," Minns said.

When Minns got involved he had a real mess on his hands.

Turns out Quiel's own attorney, Chris Rusch turned into the governments' star witness.

"While he was representing Mike Quiel in this case he found himself indicted in this case," Minns said.

In a deal with the government Rusch pled guilty throwing client after client under the bus.

He's still awaiting sentencing.

We tried contacting Rusch for comment by email addresses and phone numbers. so far we've heard nothing back.

The government spent alot of money on this case, according to Minns.

But did taxpayers get enough bang for their buck?

Probably not once you hear the end.

All of the most serious charges, the ones that had Quiel facing 35 years in prison ended in dismissals or not guilty.

He was convicted of filing incorrect tax returns.

The mistake, his attorney says didn't cheat the government it cost Quiel who ended up with less of a return.

Quiel's 10 month prison sentence is now on appeal.

"If you make a mistake on your tax return is it possible you could do time in prison even if you don't owe a tax? now the answer is yes," Minns said.

"Basically I had a nervous breakdown at the end of the trial when it was over," Vicki Quiel said.

Even though the government failed to prove the most damaging charges against him Quiel says the damage the government did to him, his family, his businesses is irreparable.

"Collateral damage I guess, Vicki Quiel said. "Why does anybody's family have to be collateral damage."

The government's case caused such havoc for his companies Quiel says a thousand people lost their jobs.

"To me it was like a disease because it affected so many other people, so many other lives," Quiel said. "It was so unnecessary."

Saturday, November 9, 2013

Doreen Hendrickson and the Form 1040 Paradox


A jury in Michigan has at least temporarily setback the federal government’s effort to greatly expand its already terrifying power over us. Government lawyers failed to convince 12 jurors that Mrs. Hendrickson must either swear to the numbers the IRS provided on a form or go to prison.
You can read more about the background of the case here.

Because the jury failed to reach a unanimous decision, there is no decision. The feds can go after Doreen on the same charges again in six months if they choose to. But there are risks for the government in doing so. The risk lies in exposing the Form 1040 Paradox to close examination.

The government’s problem is that a case like this will necessarily involve some discussion of the nature of tax returns as affidavits, and the long settled law concerning how affidavits must be made.

The government is loath to allow jurors to consider the law in any way. Federal judges routinely lie to jurors about the powers and responsibilities of juries. Federal judges do not tell juries about their right to dispense justice rather than simply follow the court’s orders concerning the law. The judge in this case was no different.

Additionally, in Doreen’s case the DOJ got the judge to instruct the jury that “the lawfulness of the order is no defense to the charge.” In other words, it doesn’t matter what the court ordered Doreen to do, legal or illegal, right or wrong, she must obey or suffer prison.  This highly questionable jury instruction is the court’s excuse for refusing to allow the jury to consider evidence of the lawfulness of the court’s order. Fortunately some discussion was unavoidable.

In order to claim the power to compel someone to sign a false affidavit, the DOJ runs the risk of exposing the jury to the great logical paradox of the income tax. This paradox, which in all other circumstances is not up for discussion by IRS or DOJ officials, is at the heart of our alleged requirement to sign and submit tax returns.

First, let’s do a quick review of legal arguments. Don’t worry, there won’t be a test on this.

The basic structure of a legal argument called a syllogism. Here is an example of a syllogism:

Major Premise:      All men are mortal.
Minor Premise:      Socrates is a man.
Conclusion:           Socrates is mortal.

The following syllogism is one the IRS would rather hide from public scrutiny, but which they tried their best, with full cooperation from the judge, to keep from the jury in Doreen’s case:

Major Premise:      Affidavits must be voluntary to be valid.
Minor Premise:      Form 1040 is an affidavit.
Conclusion:           Completing a valid Form 1040 must be voluntary.

Everybody knows the government claims filing returns is mandatory.  I’m not going to wade into that debate, but I think it will be useful to examine our syllogism for error.

To do so we must look at the premises of our paradox and make sure they are correct.

Is our Major Premise correct? We can answer that question with a quick reference to a legal dictionary or encyclopedia.  Here’s one from Black’s Law Dictionary, probably the most widely used reference of its kind in American law:

“Affidavit.  A written or printed declaration or statement of facts, made voluntarily, and confirmed by the oath or affirmation of the party making it, taken before a person having authority to administer such oath or affirmation.”[1] (Emphasis added by author in all references)

Here’s another from an online dictionary:

“Affidavit. A written statement of facts voluntarily made by an affiant under an oath or affirmation administered by a person authorized to do so by law.”

It goes on to add:

An affidavit is voluntarily made without any cross-examination of the affiant and, therefore, is not the same as a deposition.

The courts agree.

“Moreover, because an affidavit of relinquishment waives a constitutional right, it must be made voluntarily, knowingly, intelligently, and with full awareness of its legal consequences.” – in Monroe v. Alternatives in Motion, 2007.

The question of whether by signing a tax return the citizen is indeed waiving his 5th Amendment right against self-incrimination has been settled in hundreds of criminal tax evasion cases where returns were used as evidence against the defendants. Tax return information is testimony. And it has been used against defendants in criminal cases for generations.  Rights must be voluntarily waived. Apparently lots of people have volunteered to waive their rights by filing tax returns.

And the second premise?

The second premise claims a form 1040 is a species of affidavit. Looking at Black’s definition, a form 1040 certainly appears to qualify as a “written statement of facts… confirmed by oath.”  And originally signatures on returns were required to be notarized. But Uncle Sam wanted to make it easier to volunteer so
I.R.C. § 6065 and 28 U.S.C. 1746 allow us to swear to the facts on a return without a notary’s seal.

So it looks like our premises are solid. And if so, by the rules of logic, our conclusion that filing tax returns is voluntary must also be true.

I’m not going to slog into that mud pit any deeper than I have already, but I’m sure the reader can see why federal attorneys might like to avoid having a jury consider that form 1040 is an affidavit and only voluntary affidavits are valid.  It’s a consideration that may keep the DOJ from continuing its attack on Doreen Hendrickson.