UPDATES: * Internet Conference Call and Fellowship Web Cast
* IRS Walk Around * Revisiting Ron Paul's Legislative Update
* The Constitutional Quiz Question of the Week! NEWS: * Internet Sales Tax - An NST in Disguise?
* Fewer Audits - Still More Fraud
* Fraud Originators are the Delinquent Taxpayers
* Conservative Groups May Eventually Catch On
INFORMATION: * Fool's Gold?
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UPDATES: * Internet Conference Call and Fellowship Web Cast
Our weekly Internet conference call will be temporarily postponed due to the unexpected economic shake-out in the tech sector. Firetalk has recently become another casualty within the on-line arena. Firetalk announced last week that they would be ending operations on Friday March 9th, 2001. We are looking at other interactive Internet conference call sites. One we have found and are currently investigating is www.paltalk.com - it has similar features as did Firetalk. We will announce the new provider for our Internet Conference Call in the future.
If you would like to view the February 24th web broadcast class, click here. John Kotmair, founder and fiduciary of the fellowship picked up where he left off from the February 17th class as he continues to dissect the Internal Revenue Code. This web broadcast class from Save-A-Patriot Fellowship Headquarters is approximately 2 hours in length.
* IRS Walk Around
A group dedicated to the public awareness of IRS operations and their lawful role in America will be stepping it up a notch as they surround IRS headquarters in D.C. on April 9th. For well over two years this organization has held its hand out in an attempt to ascertain answers regarding the states votes on the ratification of the 16th amendment, and the legitimate role of the income tax. To this date they have received no reply to their many questions to government officials and their invitations to participate in open public forums to discuss the contentions as laid out in a Remonstrance presented to these elected officials and other "experts" have gone unanswered.
A public display to capture attention is now the plan. Will the walls come tumbling down as they did when Joshua marched around Jericho? We shall see.
For more details and how to participate on their Tyranny Response Team visit We The People organization, click here.
* Revisiting Ron Paul's Legislative Update
The Representative and token Congressional Constitutionalist Ron Paul nails the analysis behind the Indianapolis Baptist Temple forcible church seizure by Federal Marshals which happened on February 13th, 2001. If you missed the telephone recording covering this topic we have provided the text of the message. You can listen to Ron Paul's weekly message by dialing the toll free number 1-888-322-1414.
IRS Church Seizure is a Tragedy for Religious Liberty
February 13th marked a sad day for religious liberty in America, as the federal government took the unprecedented step of seizing a church to satisfy an alleged tax debt. Armed federal marshals forcibly removed parishioners and clergy from the Indianapolis Baptist Temple (IBT), bringing an end to years of legal challenges that ended with the Supreme Court refusing to hear an IBT appeal.
Amazingly, the tax dispute arose not over a failure to pay income taxes per se, but rather over the failure of the IBT to follow tax withholding rules. The tax code forces all employers, including churches, to act as collection agents for the IRS by presumptively withholding a portion of every employee's paycheck for federal taxes. The IBT steadfastly has refused to withhold taxes from its employees, arguing that religious beliefs prevent it from acting as an agent for a secular government agency. Two important facts have been largely overlooked in the ensuing controversy. First, the IBT (unlike most churches) also refused tax benefits available to it through registration as a tax-exempt religious organization. Second, more than 60 present and former IBT employees successfully passed IRS audits, meaning they paid in full taxes the IBT had not withheld. So the heart of the dispute really was about IBT's principled refusal to do the government's bidding. The real motivation behind the IRS seizure was not to satisfy a tax bill, but rather to set an example for any other churches that might dare to question their obligation to act as tax collectors.
The IBT tragedy is about religious liberty, not taxes. Churches should not be required to pay or withhold taxes any more than they should be given tax dollars from the government. The First amendment grants churches the absolute right to freely exercise their religious beliefs without interference from government. When tax laws force churches to act as collection agents for the IRS, this precious right is lost. The income tax represents the ultimate entanglement between churches and the government. When churches file income tax returns, the government becomes intimately familiar with their activities. Only those faiths deemed valid by IRS bureaucrats are rewarded with partial tax-exempt status. This entanglement chills true religious expression, because churches may alter their message to quell criticisms of government and avoid audits. When the government has the power to tax churches, it ultimately has the power to control them.
The state-loving media scarcely mentioned the IBT story, with brief articles predictably portraying the church as a fringe organization that avoided its taxes. This follows an established pattern of characterizing religious conservatives who protest the federal government as dangerous extremists, implicitly associated with militias and racists. Imagine the national media coverage, and resulting public outrage, if a minority church was seized over a refusal to pay taxes. Protestors supporting left-wing causes like abortion, affirmative action, environmentalism, feminism, AIDS, and animal rights consistently are shown as courageous martyrs fighting for principle against an unfeeling society and government. Conservative protestors, however, are shown as sinister bigots who selfishly refuse to follow benign laws and politically correct social rules.
The IBT story has resounded with many Americans, however. A strong undercurrent of dissent has manifested itself below the mainstream media radar, on radio talk shows and websites. My office has received hundreds of angry letters, emails, and phone calls denouncing the government's actions. People of all faiths understand that the threat to religious liberty affects all Americans. No society can remain free if it lacks strong institutions to challenge an overreaching government.
* Test Your Knowledge with: The Constitutional Quiz Question of the Week!
This week's question:Is the accused in any criminal prosecution granted the right to a speedy trial?
The answer to this question and many other intriguing and timely educational material will be provided in the TAX FREEDOM 101 Alert Forum at: www.egroups.com/group/taxfreedom101
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NEWS: * Internet Sales Tax - An NST in Disguise?
Mr. Ex-FL, who in his seemingly alter ego of "professional" wrestler gone governor/sportscaster is touting the need for an Internet sales tax as a champion for his State. In the name of fairness to "bricks-and-mortar" stores residing within state borders, Ventura is endorsing the "Streamlined Sales Tax Project". The project is meant to classify "taxable items" for those businesses who are charged with the collection of the sales tax from residents within its own borders. The project could send the wrong message to other states that they are losing out as well, and better find a way to regulate on-line retailers.
Maybe it is time for a Constitutional Convention to hammer out an integrated National Retail Sales Tax plan in which both State and Fed can benefit mutually? We sure hope not, but this very issue of e-commerce sales tax recovery by the states of the Union could be raised to a National level if enough states cry foul, and want a remedy to the loss of state tax sales revenue.
Ventura endorses move toward Internet sales tax
AP - Minnesota took its first concrete step this week toward joining a coalition of states hoping to tax Internet sales, an idea Gov. Jesse Ventura endorsed Wednesday.
House and Senate lawmakers introduced bills to include Minnesota in the ``Streamlined Sales Tax Project,'' which aims to get all states on the same page in classifying taxable items and set the criteria for capturing Internet sales taxes.
So far, two states -- Wyoming and Utah -- are on board and legislatures in at least 20 others are considering it.
Minnesota stands to lose $220 million in 2003 from e-commerce sales, according to a University of Tennessee study embraced by the Ventura administration.
``The sales tax is a mess and it's up to the states to do something to fix it and save it, and I want to make sure Minnesota is one of the states leading that effort,'' Ventura said.
Ventura said he supports taxing Internet sales, but not Web access. He said it's unfair that Minnesota businesses must charge sales tax from bricks-and-mortar stores while their competitors can avoid them by reaching consumers online.
* Fewer Audits - Still More Fraud
Okay tax filing cheats, now is your chance to roll the It's Really Stealing dice as Internal Revenue Commissioner Rossotti and media mouthpieces chime in unison that audits are way down. Now for those of you who don't file, or at least take advantage of gaping loopholes to avoid paying something you may not actually owe to begin with, you may soon just be labeled as an evader regardless of the facts. Sounds serious huh? But take heart dear citizen, we certainly won't hold the label assigned to you by government for creative financial practices against you. No, because before you can evade a tax you must be liable for it. The IRS isn't going to tell you who is and who is not liable, but the written law will. So unless you have actually cracked open the law book and read it, don't prejudge your neighbor with the stereotypical IRS and media news vituperation.
Fewer IRS audits means more fraud
The U.S. govt. loses $200 billion a year in uncollected taxes
By Kelly O'Donnell - NBC NEWS CORRESPONDENT
WASHINGTON, March 7 - Thursday Congress takes up President Bush's big tax cut plan. For many taxpayers that may just be a bonus to their current standing: tax evaders. The IRS has conducted major raids on tax evasion schemes, but it is still a massive fleecing of America. AMERICA'S 128 MILLION individual income tax filers can forget the fear and the dread. The taxman's most intimidating tool - an audit - is now a vanishing threat.
But a huge decline in enforcement is a free pass for many. "And if we don't halt it at this point," says Sheldon Cohen, former IRS commissioner, "it's going to be a disaster."
The United States government is losing an estimated $200 billion a year in uncollected taxes.
"People are getting away with more, sure," says Doug Stives, a certified public accountant for 31 years, "because the IRS doesn't have the manpower, doesn't have in some cases the skills to figure out what some of these people are doing."
Filers are pushing the envelope with runaway deductions.
Like the Sacramento dentist who tried to write off his Starbucks habit as a business expense. The IRS managed to catch him, claiming he failed to pay more than $500,000 in tax.
But most cheaters get away clean.
For the rest of the "taxpayer tax cheat" story - click here.
* Fraud Originators are the Delinquent Taxpayers
The question you should be asking yourself is... where is the actual fraud originating? We'll tell you where - right at the top of the government and bureaucratic heap, and by the IRS' own admission, and according to the written law the very ones liable for the tax aren't paying. These are the real evaders! Sometimes media actually prints the right story from time to time - if only by mistake.
Federal Employees, Lawmakers Owe $2.5 Billion in Delinquent Taxes
By Curt Anderson - The Associated Press - Mar 8, 2001
WASHINGTON (AP) - Federal employees, including members of Congress and their staffs, owe the government more than $2.5 billion in taxes, a situation the head of the IRS says could undermine public confidence.
The tax delinquency rate for federal employees and retirees as of October 2000 was 2.9 percent, compared with 5.7 percent for the U.S. population as a whole, the Internal Revenue Service reported Thursday.
The number includes those who owe taxes but have not entered into an installment agreement with the IRS to pay the bill. It doesn't necessarily mean a person is cheating or evading taxes.
"Tax delinquency among federal employees can damage the credibility of the tax administration system," IRS Commissioner Charles Rossotti said in a letter to federal agency heads pointing out their noncompliance rate.
"If the public perceives that federal employees do not maintain the highest level of tax compliance, public confidence in government will suffer," he added.
For the rest of the story relating to the real tax cheaters - click here.
* Conservative Groups May Eventually Catch On
Thanks to the works of ultra conservative news services like WorldNetDaily even brainwashed GOP members may eventually wake up and smell the conspiracy. The conspiracy of a two party system, the Fed bankers and Congress. Working in concert for nearly 90 years this conspiracy of "elected" officials and money masters have managed to divert attention away from the real problem in America - its money. Using the debt driven socialist agendas of Congressional whores (democrat and republican), the Federal Reserve has managed to maintain control of the purse strings of not just this nation, but many others through their money counterfeiting mastery.
Republicans may finally "get it" when their man "Dubya" and his wet band-aid tax plan slides off the festering sore of a debauched currency. If you are a proud Republican here's your sign.
Inside the All-Powerful Federal Reserve
By Geoff Metcalf - WorldNetDaily.com
Geoff Metcalf interviews veteran journalist Anne Williamson
Question: This is a complex issue, which is why I have been encouraging people to read your piece in WorldNet Magazine. Can you start us out with a basic "The Fed 101"?
Answer: OK. Eustace Mullins has a wonderful line in which he says the Federal Reserve System is not federal; there are no reserves; and, he says, "It is not a system, but a criminal syndicate." That is one of the more vituperous summations of the institution. And it's not unfair because there is a lot of truth in it.
Q: It's a cool scam!
A: Oh, it's the ultimate scam. This was a brilliant, brilliant swindle. That it has been so long-lived is remarkable, as are the results of what they have achieved with it. In the article, I try to walk the reader through the most basic elements of money and banking and then finance and currencies generally. But the real point that I hope readers will take with them is an understanding that this institution has cheated all of us of our citizenship.
Q: Why?
A: Because the Fed gives the government the power of creating unlimited debt.
Few Americans realize how radically America was changed in 1913 with the passage of the Federal Reserve Act.
Maybe most Americans don't even care.
"How does the Federal Reserve Board affect my life?" they think. "What do I know from Alan Greenspan? He's the guy who decides what interest rates are, right?"
The truth is the Federal Reserve, created in 1913, is a wholly unaccountable, private institution that affects the lives of every American -- probably more directly and profoundly than does the president of the United States. That's why Greenspan is often referred to as the most powerful man in America.
The Federal Reserve Act of 1913 was an attempt to take advantage of popular opinion in the United States for banking reforms. In effect, however, it was not reform at all. It was a power transfer -- a coup in which a small group of bankers got a blank check to set monetary policy, and, thus, all policy, for the entire nation. No watchdogs. No guardrails. No accountability. Nada. Zip. Zilch.
Perhaps Rep. Charles A. Lindberg Sr. said it best at the time: "It is common practice of congressmen to make the title of acts promise a right, but in the body or text of the acts to rob the people of what is promised in the title."
The very name "Federal Reserve Bank" was designed to deceive. It is not federal. It is not a government agency. It is privately owned. In short, it is nothing more than a group of private banks charging interest on money that never actually existed.
For more of this commentary - click here.
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INFORMATION: * Fool's Gold?
Are you considering precious metals for your investment/savings portfolio now that the major markets are in the midst of a large business cycle "correction". If so you may want to consider all the types of metal holdings available to you. Since many consider holding tangible precious metals personally, usually in the forms of coins, you should know the difference between numismatics and bullion. If tangible metals will be part of your portfolio in the near future you will want to read the following information from Certified Mint.
Some precious metals firms foster the circulation of many myths, misunderstandings, and outright lies about the purchase and sale of precious metals. Generally, these misconceptions and falsehoods promote the notion that the government may again call in gold as it did in 1933 and that "reportable" transactions are preludes to confiscation. By cultivating such fears in investors, unscrupulous firms can sell high-priced (and often overpriced) coins with greater margins of profit.
Investors who believe these stories invariably pay too much or buy the wrong coins. After reading this Web page, no investor need be taken advantage of.
Avoiding Confiscation
The most frequently used technique to promote high-priced coins is to raise the issue of confiscation. Many telemarketers tell investors that old U.S. gold coins are not "subject to confiscation," leaving the impression that modern gold bullion coins are. Consequently, many investors buy old U.S. gold coins at prices significantly higher than the value of their gold content. The idea of buying "non-confiscateable'' gold sounds like a powerful argument but wilts under scrutiny.
Many precious metals firms maintain that old U.S. gold coins, proof sets, and commemorative gold coins are "collectibles" and would not be subject to another gold recall. Some firms say that premiums of at least 15% automatically make coins collectibles. Another notion holds that coins one hundred years or older are antiques and therefore not subject to confiscation. One large firm that sells rare coins goes as far as to say:
Under current federal law, gold bullion can be confiscated by the federal government in times of national crisis. As collectibles, rare coins do not fall within the provisions permitting confiscation.
No federal law or Treasury department regulation supports these contentions.
The myth that specific types of gold coins are "not confiscateable" stems from the Executive Order that President Roosevelt issued in 1933 calling in gold. The Executive Order exempted "gold coins having a recognized special value to collectors of rare and unusual coins," but it did not define special value or collector, and certainly not collectibles. Nevertheless, telemarketers promoting old U.S. gold coins perpetuate this myth because it makes easier the selling of high-priced coins.
Just because Roosevelt exempted "gold coins having a recognized special value" does not mean that any future call-in would exempt collectibles. Roosevelt's Executive Order would have no legal binding on another gold call-in. Besides, on December 31, 1974, with Executive Order 11825, President Gerald Ford repealed the Executive Order that Roosevelt used to call in gold in 1933. This was necessary because on the same day Congress restored Americans' right to own gold. Furthermore, in 1977 Congress removed the president's authority to regulate gold transactions during a period of national emergency other than war.
Even if a law did exempt certain coins from future confiscation, the government could change that law. Sadly, the government often simply ignores laws. Dealers who say they sell "non-confiscateable" gold have no basis for making such claims.
For further discussion of this matter, assume there were another gold call-in. Would old U.S. gold coins, which make up the bulk of the "non-confiscateable" market, be exempted? Probably not because they are common coins. (The old U.S. gold coins most often promoted are the $20 Libertys and the $20 St. Gaudens, also known as Double Eagles. A $10 coin is called an Eagle, a $5 coin a Half Eagle, and a $2-1/2 coin a Quarter Eagle.)
Although Roosevelt's Executive Order required Americans to turn in their gold coins and gold bullion, foreigners continued to redeem paper dollars for gold until August 15, 1971, when President Nixon closed the gold window. From the end of World War II to 1971, our gold reserves were cut in half.
It is generally believed that all the gold coins surrendered under Roosevelt's call-in were melted or refined into .999 fine bullion bars. That was not the case. It was to the government's advantage to give the foreigners gold coins instead of bullion bars.
With the official price of gold at $35 an ounce, a foreign bank presenting $35 million paper dollars received 1,000,000 ounces if the Treasury delivered gold bullion. However, when the Treasury delivered gold coins with a face value of $35 million, it delivered only 967,500 ounces, saving 32,500 ounces. Each $20 Liberty and St. Gaudens (Double Eagles)contains .9675 ounce of gold. The smaller coins contain the same proportions. Therefore, it was to the Treasury Department's advantage to give out U.S. gold coins instead of bullion bars. Additionally, before Roosevelt's call-in, millions of old U.S. gold coins already had made their way to Europe.
So, in view of the government's policy of delivering "confiscated" gold coins to foreign governments, how can a promoter of old U.S. gold coins claim to be selling "non-confiscateable" gold when the coins he delivers may have been called in back in 1933?
Promoters of old U.S. gold coins rarely reveal the sources of their coins. They foster the idea that the coins they sell somehow survived the 1933 call-in. Probably, the coins being promoted just arrived from Europe a few weeks earlier. Several large numismatic wholesale firms have offices in Europe for finding hoards of old U.S. coins. One firm advertises "Shipments coming in from Europe daily." Another firm boasts offices in Brussels, Paris, and Zurich.
As noted above, the premise of "non-confiscateable" gold lies in Roosevelt's Executive Order that exempted "gold coins having recognized special value to collectors of rare and unusual coins." Are old U.S. gold coins "rare and unusual" today? Not hardly.
Between 1850 and 1907, U.S. mints turned out over 100 million $20 Libertys. Between 1908 and 1933, they coined some 65 million $20 St. Gaudens. Today, no one knows how many have survived, but the number is undoubtedly in the tens of millions, with the bulk of them residing in European bank vaults.
Because of all the old U.S. gold coins in Europe and because of the huge premiums they carry, old U.S. coins are dangerous investments at this time. If gold rallies, European banks may see it as an opportunity to unload, causing old U.S. gold coins to fall in price while gold goes up. For further discussion about why old U.S. gold coins are overpriced, see Old U.S. Gold Coins.
If gold fails to rally, the banks may fear gold will stay down for a long time, prompting them to resume selling. This, too, would cause the old U.S. gold coins to fall in price, shrinking the premiums at which they sell over spot.
Since 1989, PCGS and NGC, the two major grading services, have "slabbed" over two million coins rated MS-60 or higher. Now, the two services are grading 200,000 to 300,000 coins a month. (See PCGS, NGC, and "Slabbed" Coins on our Web page Old U.S. Gold Coins.) Millions of lower-grade coins (VF through BU) do not even warrant being submitted. Yet, they are sold as "non-confiscateable" semi-numismatic coins. Low-grade coins that have no real collector value are called semi-numismatic. VF/XF common-date Double Eagles are definitely semi-numismatic coins.
Add in the uncounted smaller denomination old gold coins ($10 Eagles, $5 Half Eagles, etc.) and the number of available old U.S. gold coins grows even bigger. There is no way the old U.S. gold coins being promoted as "non-confiscateable" have a "recognized special value to collectors of rare and unusual coins."
The concept of "non-confiscateable" gold is counterfeit. The idea lives only because dealers continue to push it for their own benefit. Investors who do not have the facts are unable to know otherwise. Readers of this Web page, however, need not be victims to the hype and promotion so prevalent in the gold coin industry.
Investors wanting to buy gold should go with the bullion coins: American Gold Eagles, Maple Leafs, or Krugerrands. These coins move dollar for dollar with the world price of gold and are easy to buy, sell, and trade. Additionally, tracking the value of these coins is easy. No "expert" has to look at them.
Avoid European Coins
Over the last few years, telemarketers have been importing European bullion gold coins dated before 1933 and claiming they, like old U.S. gold coins, would be legally beyond the reach of the government in another recall. The imported coins most commonly promoted as non-confiscateable include:
· French Twenty Francs (both the Roosters and the Angels);
· British Sovereigns (usually with the images of Queen Victoria or Edward II or George V);
· Swiss Twenty Francs (also called Helvetias);
· Belgium Twenty Francs (a.k.a. King Leopolds);
· Swedish and Danish 10 Kroners (Mermaids);
· Swedish and Danish 20 Kroners;
· Dutch 10 Guilders.
Investors should avoid European coins. As noted above, the notion of "non-confiscateable" coins has no merit, and dealers promoting European coins do so because they provide bigger profits. That's bigger profits for the dealers, not their clients.
European coins are not worth the high prices promoters ask. Regardless of the dates on them, they are not "non-confiscateable." Additionally, they hold little, if any, numismatic potential. It is a peculiarity of the coin collecting that coins are prized by numismatists (coin collectors) only in their countries of origin. Americans collect U.S. coins; the British collect coins of Great Britain; the Japanese collect Japanese coins, etc.
Furthermore, the European coins are often compared with old U.S. gold coins, which can and do achieve premiums at times (See Old U.S. Gold Coins). European coins, as a rule, are simply bullion coins and will never attain genuine numismatic premiums. Some of the coins have been around for a hundred years and have always sold at only a few dollars above the value of their gold content. That is why telemarketers promote them. They buy the European coins near bullion prices and mark them up, ensuring big profits for themselves.
Still, there are other reasons for not buying European coins, even when you can get them at reasonable prices. First, they contain unconventional amounts of gold, such as .1867 oz, or .2354 oz, or .1947 oz. Americans prefer full ounce coins, or fractions of ounces they easily understand, such as 1/2-oz, 1/4-oz, or 1/10-oz.
Second, Americans prefer coins stamped in English. The European coins, obviously, are stamped in the languages of their countries of origin. But perhaps worse, the European coins do not have their gold content stamped on them. If you have to use such coins in an emergency, how are you going to convince someone other than a coin dealer that the coins contain the gold content you say?
Your best buys in fractional-ounce gold coins are American Eagles, Canadian Maple Leafs, or Krugerrands, although fractional-ounce Krugerrands can be difficult to find at times. These coins have their gold content stamped in English and come in sizes Americans are used to dealing with. Always, these coins are cheaper than promoted European coins. Even when you find European coins at bullion prices, fractional-ounce Gold Eagles, Maple Leafs, or Krugerrands are comparably priced. There are no compelling reasons for Americans to buy European coins. Americans should buy Gold Eagles, Maple Leafs, or Krugerrands.
Dear Netizen: Do you find the material in The Tax Freedom 101 Report interesting, useful, educational, or surprising? You do? Great! Then why don't you recommend this newsletter to a friend or two. They don't have to be a crazed liberty-lovin "radical" like you and me - even raging communists enjoy reading our newsletter and everyone in between! So spread the word... the forward button is just a click away...
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