THE COURT: You may proceed.
MR. BECRAFT: May it please the Court.
DIRECT EXAMINATION (Cont'd) BY MR. BECRAFT:
Q Mr. Long, yesterday before we, the last subject that we were on when we broke for the afternoon I believe related to Exhibit No. 3, that Privacy Act notice. And you were telling us something about watching a video of Mr. Carter?
A Yes, sir.
Q Okay. Could we pick up right there?
A Yes, sir.
Q Now, this was at a meeting that you attended of the Tullahoma group?
A Yes.
Q Okay. Tell the jury what you were seeing on video.
A Well, as I recall, he had told us about the Privacy Act itself, and then had pulled out the Privacy Act notice for the Internal Revenue Service. And as I recall, it said something about that our legal right to ask you for this information is Internal Revenue Code Section 6001, 6011, and 6012A, I believe, and basically you should be able to determine from those three sections whether you'd be subject to file or the liability. Well, then he proceeded to go ahead, and he pulled out his code book and flashed Section 6001 up on the screen.
And it read: "Every person liable for any tax under this Title, or fox the collection thereof, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary from time to time may require." And he really emphasized this "person required," because that's obviously, whoever this is that's supposed to do this, "person required," he made the point that it doesn't say anything about who that is. Well, I thought, "Yeah, that's right on the button. It doesn't."
And so then he went on to, he said, 'Let's go look in Section 6011." And it's the general rule which I guess encompasses everything, the way he explained it. The general rule says, "Every person made liable for any tax imposed by this Title, or for the collection thereof, shall make such return or statement according to the forms and regulations as prescribed by the Secretary." Well, here again we've got this -- only this time it's this "person made liable." But here again, it doesn't say who this person is. He really emphasizes that, that this "person liable" and "person made liable" is this unique entity out here. It's like a form of art. You know, who is he? And neither section explains who this person is. It just says the person liable and the person made liable.
Well, then he said, "Let's go on over to Section 6012 and see what it says." And as I recall, it said something to the effect that every individual having gross income that equals or exceeds the exemption amount shall file a return. So, then he makes a point, you know, we've gone now from person liable to person made liable and now we're talking about individuals and gross income. And the only conclusion that you can draw from that is that if this individual has gross income in this capacity or whatever, then obviously he must be one of these people that's required -- or that's liable. But it doesn't mention anything about liability in Section 6012. So, he goes back over and, you know, who is this person liable and the person made liable? You know, that sounds like somewhere they're going to make somebody liable.
So then he says, you know, "Do you reckon Congress knows how to impose a tax and then how to make somebody liable for that tax?" So, he says, "Let's flip over in the booze part or the alcohol section." And he goes to Section 5003. Well, it plainly says, "There is therefore imposed a tax upon distilled spirits of 12" -- this is, you know, my quotation of it -- $12.50 per proof gallon, and then a proportional tax for every portion less than a gallon. Well, now, that's real clear. I believe anybody can understand that. I can understand that. It's real clear. $12.50 and it's on every gallon. Well, then he says, "Now let's see if they know how to make somebody liable." So, he flips over to Section 5005, and here it says, "persons liable for the tax." It says it's the distillers, manufacturers, and the importers. They're liable for the tax on the booze. Now, that's real clear, "persons made liable."
So, then he goes back to Section 6001 again and says, "Maybe we've missed something here. Let's go back through it again." Well, Section 6001 says, "Every person liable for any tax imposed by this Title, or for the collection thereof, shall keep such records, render such statements, and make such returns, and comply with the rules and regulations as from time to time prescribed by the Secretary." Is that clear? Who is this person liable? Does it say who it is? It just says "person liable." Well, then he goes over to 6011 again. And says, "Well, every person made liable for any tax imposed by this Title shall keep such records and make such a return that" -- well, I've lost that one. "Every person made liable for any tax imposed by this Title or for the, collection thereof, shall make such a return or statement," and you do it on such forms and regulations as prescribed by the Secretary. Here again, it's "every person made liable."
Over in the booze section or the alcohol section, it plainly states what the tax is on and it plainly comes over here and says "persons made liable for the tax." Well, now, that's real clear to me. And then I remember the Sprinkles case, United States Supreme Court case, that says, "keeping in mind the well-settled rule that the citizen is exempt from taxation unless the tax is imposed in clear and unequivocal language, and that should there be a doubt about the language of the tax law, the doubt should be resolved in favor of the person upon whom the tax is sought to be collected." Well, now, that gets my attention.
Well, I'm sitting here with my head spinning, thinking about all this, because, you know, I know that the income tax is an excise tax, like I told you yesterday. Now this guy is talking about that this "person liable" and it's not defined there. We can't find it. So, then he makes a statement that just curls my hair. He says out of all of his research and going through this book, a complete internal Revenue code, that he has not found the section in this whole book, two thousand pages and nine hundred sections, that makes anybody liable for the income tax. Whew. You could've knocked me over with a feather. Now, surely, a book that big, if we're liable, there ought to be a section in there somewhere that makes us liable. Well, now, he had my attention by then, you can believe.
Then he came out and said not only had he researched it, but there was a group up North that had put out a one-hundred-thousand-dollar reward for anybody that could find the section in that book that made somebody liable for the income tax. I'll tell you, I just couldn't believe it. I just couldn't believe it. So, you know, there's nobody liable, no section in there that makes anybody liable, and yet we're all filing and paying all these taxes? Now, I knew it was an excise tax. But now he's done showed me something else here that's just blowing my mind.
Well, then he pulls out a document, it's the mission statement from the IRS themselves, and says, it says, "The mission of the Internal Revenue Service is to encourage and achieve the highest degree possible of voluntarily compliance." Now, I'd heard "voluntarily" all my life. And, you know, when you're in school they say, "I need a volunteer," and then they pick somebody, you know, in a class a lot of times. But that's not quite voluntary, is it? But then he went on to say, "Do you know what the definition of 'voluntarily' is in Black's Law Dictionary?" Of course, we sat there and waited. He said, "The definition of 'voluntary' in Black's Law Dictionary is 'To do something without legal obligation.'" Now, that sounds right, you know. I know what voluntary means. It's voluntary. Then he said, "Do you know what compliance means?" We waited. Black's Law Dictionary said that compliance means "To do something in an effort to please." So, then he said, "What we've been doing is donating to the IRS in an effort to please."
Now, I'll tell you, it just blew my mind. And this is what he said. Then he showed us another document by, Mr. Kurts, who was the Commissioner of the Internal Revenue Service. And it was an annual report, I believe. And in this report he had mentioned the word "voluntary" six or eight times. Well, by this time he's got my head spinning. No section in the code that makes anybody liable, a hundred-thousand-dollar reward for anybody that could find one, and now he's telling me the mission statement says it's voluntarily. Not only that, but the commissioner himself has mentioned the word "voluntary" six or eight times in his annual report. Then he pulls out a document. It was a Senate subcommittee --
Q We've got exhibits on these.
A Okay.
Q Can we skip over those?
A Sure.
Q Okay. Besides what you know are exhibits in this case, was there anything else that he said that had an impact upon your beliefs?
A Well, that's where I was going. That particular document was, it was a statement by the head of the Alcohol and Tobacco division, which was Mr. Dwight Avis. And he had made this comment before Congress. The statement said, as best I recall, said, he said, "Let me make this clear. Your income tax is 100 percent voluntary tax, while your alcohol tax is 100 percent enforced tax. There's as much difference as day and night, and the same rules will not apply." Now, here's a guy right in the Internal Revenue Service himself, one of the heads of the department, and he's saying that the income tax is a hundred percent voluntary.
Now, I'm a school teacher. And when we grade papers and we give somebody a grade, a hundred percent is a hundred percent. There ain't no in between, not 99.5. He said it was a hundred percent voluntary tax. Well, needless to say, he got my attention, had me thinking. And I recalled, you know, that the Bible says we're to prove and reprove the Scriptures. And the reason we're to do that is we're not supposed to just read it and say, "I accept that." God wants us to read it, put it in practice in our lives, and test it so that when we may we believe it, we believe it from our heart because we know it works. So, I determined in my mind, with a little incentive called a hundred-thousand-dollar reward, that I was going to see if what this guy said was right. So, by this time I believe it was somewhere around 1988, early '88. I was at Saturn and I was staying over there part of the time. So, I had some time to study. And then I'd get with the group when I'd come in on the weekends sometime. So, I went to the Read More Book Store in Columbia, Tennessee, and I ordered me a complete Internal Revenue code book. Cost $27.52. And I sat down -- took me a week to get it. They had to order it. And I set out over the next few weeks, when I had time, and remembering as best I could what he did, I sat down and I went to Section six thousand
Q Can I stop you there?
A Yes, sir.
Q Did you -- yesterday we introduced Exhibit No. 3, which is copies out of your 1988 1040 instruction booklet.
A Right.
Q Do you remember that exhibit?
A Yes, sir.
Q Okay. Now, after he told you or after you viewed this video of this Mr. Carter, did you look at that document? This was in '88?
A Yeah. That was one of the first documents I looked at before I started studying because I went back, I had to go back to it to remember the 6001, 6011 and...
Q The '88, you would've gotten that in the mail sometime in 1989?
A (Moving head up and down.) No. Well...
Q Early part of -- late '88?
A Well, I saw the video before I got that.
Q Okay. All right.
A Yeah.
Q I'm sorry.
A That's okay.
Q You went to the Read More Book Store and got that code?
A Uh-huh.
Q And then what happened?
A Well, like I said, I started to set out to prove what he had said was either right or wrong. So, I went and I flipped over to Section 6001. And sure enough, it said, "Every person liable for any tax imposed by this Title, or for the collection thereof, shall keep such records, render such statements, make such returns, and comply with such rules and regulations as the Secretary from time to time may prescribe." "Every person liable." But nowhere in that section did it make any further reference to who was liable, who the person is, who this entity is. I thought, Okay, we'll flip over to Section 6011."' And sure enough, General rule. Any person made liable' for a tax imposed by this Title or for the collection thereof, shall make a return or statement according to the forms and regulations prescribed by the Secretary." That's exactly what he said.
Q Now, can I stop you right there? When you just made that statement and just did what you did, you're giving the jury your understanding of what the law is; is that not correct?
A Oh yeah. Yes, sir.
Q Just as long as we're clear on that.
A Yes, sir.
Q Now, continue.
A I'm just telling you what I remember.
Q All right.
A Well, here again, we've got "any person made liable." Now, being a school teacher, if you say "somebody made liable," you assume that somewhere it's going to say who's made liable or how they're made liable or something. Well, then the only other section is Section 6012. So, we flipped over there. And it talks about every individual having gross income. Now, it could've said, "every American." But it doesn't say "every American." It says "Every individual having gross income shall make a return," gross income that exceeds the exemption amount shall make a return. And I know sometimes in our studying we discovered that "shall" can mean "may." But nowhere in Section 6012 does it talk about making anybody liable, yet it follows 6011 talking about "persons made liable." So, who is this person? Who is this person made liable?
Q What did you do?
A Well, I decided I'd do just what he did. So, I flipped over to Section 5001, the booze section, alcohol section. "There is hereby imposed a tax on distilled spirits of $12.50 a gallon and on every proportion thereof". It's real clear. I flipped over to Section 5005, and it says "persons liable for the tax. And it says distillers, importers and manufacturers. It may not have have manufacturers, but distillers and importers are liable for the tax imposed. Real clear. Now, I can understand that. So now I'm beginning to understand. I'm reproving what he has told us, and so far he's right on the money. Now, who, you know, it's going over in my mind, "Who is this person liable?" And then I remember he said there's no section in the entire Internal Revenue code, and I don't -- they couldn't have left it out to save money. So why is it not in there, if it's not? But he says it's not in there, and there's a hundred-thousand-dollar reward out for anybody that can find it. Why is it not in there?
So, I remembered the mission statement of the Internal Revenue Service, you know. "Our mission is to encourage and achieve the highest possible degree of voluntary compliance." And I remembered what he said voluntary compliance was. I looked that up. And that's exactly what it is. Voluntary is voluntary. And there's no way you can make mandatory out of voluntary, you know. It just don't work. And then I, I think probably somewhere in there I was back home and I went to a meeting. And some of the people in the other groups had mailed us a copy of this document by Mr. Avis where he said -- and you've got it there -- that your income tax is 100 percent voluntary tax.
Q Let me stop you there, Mr. Long. I've just handed to you, is it 5, 6 and 7? Exhibits 5, 6 and 7?
A Right.
Q Okay. Are those documents that you read and relied upon in 1988?
A Yes, sir. It says, "Internal Revenue investigation hearings before" --
Q Let's get it admitted first.
A I'm sorry.
Q And those are the documents you previously identified and talked about, right?
A Yes, sir.
Q MR. BECRAFT: Your Honor, I'd move for 5, 6 and 7 to be admitted.
THE COURT: Okay. Subject to the government's objection, they'll be admitted on the same basis that documents 1, 2 and 3 were admitted yesterday. And they are -- well, we've got what, this Avis statement, what is that? That's 5?
MR. BECRAFT: The Avis statement is 5.
THE COURT: They're admitted. (Defendant's Exhibits 5, 6 and 7 were received into evidence.)
MR. BECRAFT:
Q Now, Mr. Long, take a look at 5. You were mentioning that a moment ago?
A Right.
Q I just now see that you've got in your pocket a yellow Magic Marker, right?
A Uh-huh.
Q Now, that document is what, Exhibit No. 5?
A Oh, it's the Internal Revenue investigation hearings before the subcommittee of the Committee on Ways and Means, House of Representatives. It's a mouthful.
Q When?
A In 1953.
Q Now, is there something of importance to you in that document that relates to your beliefs?
A Yes, sir.
Q Can you take your yellow pen out, find that spot and line it through in yellow so that the jury can see it?
A Yeah. I had mine marked. It'll take me just a minute here. (Performs marking.)
Q Now, can you tell us what you've just lined through in yellow that you found on the report?
A Mr. Avis says, "Let me point this out now. Your income tax is 100 percent voluntary tax and your liquor tax is 100 percent enforced tax. Now, the situation is as different as day and night. Subsequently, your same rules just will not apply.
Q Now, let's take 6 and 7. Can you briefly explain to the jury what they are? And then take your Magic Marker and highlight in yellow those parts of those two exhibits that you find of importance.
A This is an Internal Revenue Service cumulative bulletin that states the mission statement. (Performs marking.)
Q Now, can you tell jury what you just lined through in yellow?
A "The mission of the Service is to encourage and achieve the highest possible degree of voluntary compliance."
Q All right. Now, the next exhibit as what, 7?
A Yes, sir. This is a 1979 annual report by Mr. Kurtz, Jerome Kurtz. And he mentions the word "voluntary" in here six times.
Q Now, did you understand those to be official government documents?
A Yes, sir.
Q Okay. Now, I don't think we need to belabor the point, but you mentioned a moment ago those were mentioned on the videotape?
A Right.
Q And then you secured those documents that he mentioned on the videotape, right?
A Yes, sir.
Q And those are the ones you're talking about?
A Yes, sir.
Q Now, I think I interrupted you. You were talking about liability, were you not?
A I was talking about, you know, I was reproving that he had told us about this "person liable or "person made liable."
Q What did you learn in that respect?
A well, I searched through -- I didn't try to read the whole book, because I'm sure everybody can look at that and see it's tough reading. But I went through the entire section on the income tax, which is about 1500 sections, just looking at the captions. I couldn't find a section there that made anybody liable. I looked through the six thousand parts, which you'd think would go with it. The 6001 is supposed to be right in that area. I couldn't find any section that made anybody liable. Then I remembered that he said there was a hundred-thousand-dollar reward out. So obviously, the people that put the reward out had researched. And my only conclusion was that there is not a section in there that makes me liable, or anybody else for that matter.
Q Well, what's so important about that? Being liable for the income tax, what's so important?
A well, I know that it's an excise tax. So, in order to be liable for it, I'm assuming, since it's an excise tax, you've got to have some kind of privilege or be in an occupation that's a privileged occupation.
Q Okay. But if someone is liable, in your view, if someone is liable for a tax, are they required to do something?
A Well, yeah.
Q What?
A Like we talked about in the booze tax, if it's clearly liable then they'd be required to file the forms and things and keep the records.
Q Now, if someone, in your view, if someone is not liable for the tax, what's the consequence?
A If you're not liable for the tax, you're not required to file.
Q That was the conclusion you reached from that study you just described?
A Yes. There is no other conclusion. If the person liable for the tax is required to file, and if somebody is not liable for it, then obviously they wouldn't be required to file.
Q Mr. Long, I've handed you what's been marked as Defendant's Exhibit No. 4, is it?
A Yes, sir.
Q Now, can you identify that document for us?
A Yes. It's the AM-Tax guide to the Internal Revenue laws as they pertain to individuals.
Q Is that a document you acquired when?
A I think it was sent to the group somewhere around '88, somewhere in there.
Q Did you read and rely upon it?
A Yes, sir.
Q It was relevant to the formation of your beliefs?
A Yes, sir.
MR. BECRAFT: Your Honor, I'd move for the admission of Exhibit No. 4.
THE COURT: Ladies and gentlemen, it will be admitted, but I want to give you this special instruction with respect to this document. This document is received only for whatever it may show about the defendant's state of mind. You should not consider this document as evidence or proof that anything said in the document is true. (Defendant's Exhibit 4 was received into evidence.)
MR. BECRAFT:
Q Now, Mr. Long, all these exhibits, particularly Exhibit No. 4, you recognize?
A Yes.
Q You're not trying to tell the jury what the law is?
A Oh, no. No, sir.
Q And you're trying to show the jury what you read to reach your conclusions, to show your beliefs?
A Yes, sir.
Q Okay. With that understanding in mind and any comments you make when we're talking about this particular document, can you tell the jury now what you've learned by reading this document?
A Well, basically this document goes through and discusses basically what I've told you. It goes through and shows how, just like Mr. Carter did, that Congress knows how to impose a tax and knows how to make anybody liable by going through Sections 5001, 5005. It just compounded and -- what's the word -- reinforced what I had already learned, that there's no section in there that makes anybody liable.
Q Without getting into detail then, this particular exhibit summarizes your belief?
A Right.
Q And what you've just said about the process that you went through about this liability argument, it's covered in the book?
A Right.
Q Word for word?
A Well --
Q Or substantially.
A Mighty close.
Q Same argument?
A Yes, sir.
Q Now, when you looked at Exhibit 4 and read it and studied it, that AM-Tax guide, did you find anything in there that would cause you to distrust it?
A No, sir.
Q Did you believe it?
A Yes, sir.
Q Now, let's come forward. Had you reached all these conclusions by, say, December 31st, 1988?
A Somewhere in there. Maybe a little before then.
Q At least by that time?
A Yes.
Q At the latest?
A Right.
Q Now, that's the end of the year for 1988?
A Right.
Q And I showed you a minute ago, and I think I got ahead of myself, on Exhibit No. 3, the Privacy Act notice. You'd filed a return for '87, right?
A Yes, sir.
Q And for '88 did you receive -- you know, we've got here the complete, but we've offered the excerpts from the '88 instruction booklet. Would you have gotten that sometime in early '89?
A Uh-huh.
Q Well, when you got in the mail the instruction booklet and the 1040 form, you went ahead -- and it's offered into evidence. I think it's Government's Exhibit No. 11, or thereabouts. You went ahead and filed a return, did you not?
A Yes, sir, I did.
Q Well, why?
A Well, I was still thinking about all this. And you know, I knew beyond a shadow of a doubt in my mind that if the United States Supreme Court said it was an excise tax, that was good enough for me. And we had all these state supreme court cases that said that the income tax was an excise tax. Then we had two government reports where the government said it was an excise tax, from the Congressional Research Service. I knew that for a fact. Then I had studied and researched Mr. Carter's material and had reproved that to myself, that there's no section in the entire code that makes anybody liable, that I can find. And I had looked up the mission statement and I had gone to Mr. Avis's statement, it had come in, and it said that it was voluntary. But I still wanted to prove and reprove. You know, I knew all this, believed it in my heart, that I didn't have to. But I went ahead and filed that year. And then I decided that I'd give the Internal Revenue Service an opportunity to tell me that I was wrong.
Q Let me stop you there before we move on to that topic. Exhibit No. 3, when you got the '88 instruction booklet in '89, I take it then you looked at it, at the Privacy, Act notice?
A Yes, sir.
Q Okay. And you confirmed what you'd learned earlier about the contents of that notice?
A Right.
Q Okay. And it mentioned just three Internal Revenue code sections that dealt with the requirement to file returns, right?
A Yes, sir.
Q So, that's where it fits in your overall picture; is that correct?
A Right.
Q Now, let's say by at least April 15th, or whatever the date is for 1989. April 16th. Who knows. But that time you did file an '88 return?
A Yes, sir.
Q Correct?
A Sure did.
Q Well, what did you do the rest of the year of '89?
A Well, I decided to write some letters to the Internal Revenue Service.
Q Now, these letters on this point, the copies that I have in these file folders are your letters. You have your original letters up there, right?
A Yes, sir, sure do. And where I mailed them.
Q On Monday you made copies of those letters and they're here, right?
A Right.
Q Now, let's take the very first letter that you wrote.
A Okay.
Q And I'm going to call it Exhibit No. 9. Do you need to look at this?
A No, sir, I've got it right here.
Q Okay. Now, is this a letter that you read -- I mean that you wrote to certain people?
A Yes. This was the first letter I wrote, and I sent it to the Department of the Secretary of Treasury in Washington, the Commissioner of the Internal Revenue Service, and I sent one to the district director in Nashville.
Q And does this exhibit also have a letter from the IRS back to you?
A It has a reply, yes, sir.
MR. BECRAFT: I'd move for the admission of 9.
THE COURT: I've got it listed here as 8. Oh, this is a letter of July 27th?
MR. BECRAFT: Well, I should have, on my list, Your Honor, I should've put correspondence.
Q What is the -- are these letters dated?
A This one was mailed July 27th.
Q Oh, okay. So Exhibit No. 9 is two letters that you wrote in and a reply back?
A Yes, sir. And I'm not too good a typist, so I left the date off of that particular one. But I do have my certified return receipts that they got the letter.
Q so, you deposited it in the mail?
A Yeah. And then you get a green card back saying they've signed that they received it.
THE COURT: Nine is received. (Defendant's Exhibit 9 was received into evidence.)
MR. BECRAFT: I'm going to work off of it, Your Honor, and he's going to work off of his original.
MR. BECRAFT:
Q Now, tell the jury what you were doing by these -- one is a letter to the Department of Treasury and one is to the Commissioner of Internal Revenue. Why did you write these letters?
A Well, I knew what I knew. But where I come from, if you owe somebody money and they send you a bill and you show them you don't owe it, then, you know, they got to agree you don't. If they try to keep saying you owe it, then that's wrong. That's the way I was raised. So, I thought that the Internal Revenue Service is supposed to be part of the United States government, and that if I wrote them and explained to them who I was and my situation, that they'd see since I knew it was an excise tax and I knew there was no section in here that made anybody liable, and it's voluntary, that they would see that I wasn't a person that was liable and they'd tell me that. And so I wrote the letter.
Q Can you describe for the jury, you know, just summarize the contents of these two letters. were the letters to the Department of Treasury and the commissioner identical?
A Yes, sir.
Q Just changed the address?
A They're identical letters. I just sent them to three different people.
Q Now, what did you state in these letters, briefly?
A I told them who I was, where I was from, that I was born and raised in Tennessee, that I worked in Tennessee, worked in Tennessee all my life, that I didn't have any licenses or privileges that I knew of. I did say that I had applied for, years ago, and received, a social security number that I was told I had to have. And then I said, you know, could you help me understand, you know, from my situation and my circumstances, I said, number one, given my situation and circumstances, am I required to file a federal income tax return? And then I put in one more question. I said, "Is a native born Tennesseean, American, required by any Tennessee, state or federal law to have a social security number?" Because I was told when I got mine you had to have one.
Q Did you receive a reply?
A Yes, sir.
Q Tell the jury what was in it.
A I received a reply back. And basically it said that the current federal tax law enacted by Congress, Internal Revenue Service Code Section 6012, and the code provides that every individual whose gross income for tax year equals or exceeds specified amounts must make a return with respect to income tax. That's what it said. There's 6012, you know, that Mr. Carter had showed us, that I had looked at. It doesn't say anything about anybody being liable. It just says you shall make a return. And I know from some of our studies that the word "shall" can be "may." And I had asked them, I thought, very specifically, given my situation and circumstances, am I required to file a federal income tax return? I was expecting a yes or no, but I didn't get one.
Q Now, Mr. Long, just for the benefit of the jury, I notice you made a copy of this letter. And they've got a rubber stamped date on here. It's kind of dim. I can see August 25th. What's the year?
A August 25, '89.
Q That's the rubber stamp date on the letter?
A Yes, sir.
Q So, your question wasn't answered?
A No, sir.
Q What did you do next?
A Well, I wrote another letter.
Q Mr. Long, I have in my hand proposed Exhibit No. 10, which is a letter, one to the district director, you've got it notarized November 12th of '89; another one to the commissioner, same date; another one to the Department of Treasury, same date.
A Should be three.
Q And then some letters back to you?
A Right.
Q Now, do you have your originals there?
A I have the originals.
Q These are accurate copies of the letters you mailed to the government and the reply that you got back, which is dated October 31st of '89?
A It was mailed on the 11th. So, that's about right.
Q I'm asking about the letter you received.
A Oh. Let me look. What does your date say?
Q What does yours say?
A This one says December 5th.
Q I'm looking at the copy I've made. Is there one for October 31st of '89?
A Is this my second letter?
Q Yes.
A Are we confused here? Oh, okay. Yeah.
Q You flipped too far.
A I got it from two different people that time. I got the same letter from two different people. But the letter -- let me explain that. I got two answers that said the same identical thing, you know. It was from, one was from maybe the Secretary and one of them was from the commissioner, but they were both written by Ms. Ruth Hill, Chief of the Information and Campaign Branch.
Q You have a second letter you didn't make a copy of?
A Yeah.
Q That says the same thing?
A Same identical thing.
MR. BECRAFT: Your Honor, I'd move for admission of 10.
THE COURT: Is that 8?
MR. BECRAFT: Ten.
THE COURT: Ten is received. (Defendant's Exhibit 10 was received into evidence.)
MR. BECRAFT:
Q Now, Mr. Long, why did you write what, two or three letters here?
A Yeah. I mailed them to three different people: the commissioner and the Secretary and, I think, the district director.
Q But the body of the letter in each one, three different people, different address and different greetings --
A Right.
Q But the body of the letter --
A Body of the letter is identical.
Q So, let's just cover one. You mailed it to these three different people. What were you trying to accomplish? Why were you writing these letters?
A Well, I wanted a clear answer. And I felt like a native born Tennesseean deserves a clear answer. If they're a service like they say they are, you know, they tell us to call or write and they'll answer our questions. So, I wanted a clear answer, yes or no.
Q Did you ask some questions in these letters?
A Yes, sir. I told them basically the identical same thing, my situation, that I had never asked for or received any kind of licenses or privileges that I knew of, that I was just, I think in both of these I had said I am exchanging my labor, contracting my labor with other individuals for compensation of equal value. And then at the bottom I asked them three -- well, it was kind of one question but three parts. I said, "Am I required to file a federal tax form of any kind? And if so, what type of federal tax are you implying that I am liable for, and what is the source of such a tax liability?"
Q Now, for the jury, quickly, have you got your beliefs in this letter about the license and privilege, the excise tax position that you have?
A Well, yes, sir, pretty much. I told them I didn't have any licenses.
Q And when you say you asked the question about what I am liable for, that's based upon what you had understood about being liable for tax?
A Yes, sir.
Q So, this letter or these three letters are premised upon, they're based upon your two positions?
A Yes, sir.
Q That it's an excise? You've got to be liable for the tax to be required to file a return?
A Yes, sir.
Q Now, what, if any, reply did you receive?
A Well, I got a letter again from Ms. Ruth L. Hill, Chief of the Information and Campaign Development Branch.
Q You got two of them?
A They were both from her, but they were from, you know, different people I sent the letter to. In other words --
Q Different dates?
A Yeah. She sent it to me twice.
Q But beyond that, it was the identical letter?
A Identical letter.
Q So the jury, when they see this, they'll see that both letters were identical?
A Right.
Q Okay. Now, what did you learn from this letter that you received from Ruth L. Hill?
A Well, I got real excited about this letter because in my previous one I think I had made the statement that if they couldn't tell me, you know, yes or no, then I was going to assume, you know, that I wasn't required or wasn't liable. Well, they wrote me back and said, "You cannot presume or infer anything that we don't send you expressly stated in our letters to you." Well, now, a school teacher like myself, when they taught us how to teach, we get a new class, they always told us you, "Don't assume that they know anything, so you start them at the bottom and come up." So, anything means anything. And they're telling me that I can't assume anything here, and yet they go ahead then and say the Internal Revenue Code Section 6012 refers to returns with respect to income taxes as explained before, and goes on and says that, says something to the effect that if I'm trading services or whatever that I've got to file for the fair market value or something of those services. And then they go on and explain about Sections 1401 and 1402 of the self-employment stuff. And that wasn't my questions at all. I'd told them my circumstances. And there they were quoting Section 6012 again, "individuals having gross income." So, I didn't get a yes or no or any kind of statement as to what my liability might be or anything.
Q Now, they sent to you, attached to that letter is a couple of, one of these is labeled "Self-Employment Tax"?
A Right.
Q Were you self-employed at the time?
A No, sir.
Q And how about this other document that's attached to it?
A It was something about some kind of a revenue law, about folks being in barter clubs and stuff. And I've never been in a barter club in my life, you know. I'm just contracting my natural occupation of common right with other people for other property.
Q When you read the letter, did you have any opinion or conclusion that you reached as to whether or not the questions that you had asked had been answered?
A They hadn't answered my question.
Q What, if anything, did you do next?
A Well, I wrote them another letter.
Q The third letter?
A Right.
Q Now, I have -- you made, on Monday, I've got copies of letters dated February 23rd, or at least there's notary on them of February 28, I'm sorry, 1990, Mr. Long?
A I'm sorry?
Q This Exhibit No. 11?
A Right.
Q Is the third series of letters, right?
A Uh-huh.
Q I have in my hand -- you have the originals there?
A Yes.
Q But three letters, and they're all notarized on February 28, 1990. Are these letters that you wrote to the Secretary, commissioner, district director?
A Right.
MR. BECRAFT: Your Honor, I would move for the admission of 11, Defense Exhibit 11.
THE COURT: Received. (Defendant's Exhibit 11 was received into evidence.)
Q Now, Mr. Long, let's talk about why you wrote this third set of letters.
A Why?
Q Yeah.
A Well, like I said, you know, I have heard the IRS advertise, you know, "Call us and we'll be happy to answer your questions." They've got this voluntary service, they've got all this kind of stuff going on. They're supposed to be a division of the United States government. I'm a citizen. So, I'm wanting a straight answer, and I believe I deserve a straight answer. You know, they've got, I don't know how many employees they got, I don't know how many lawyers they got. You know, why won't they tell me yes or no? If that's what Section 612 says, why can't somebody say, yeah? So, I'm kind of a determined type of person. Like I say, I dated my wife for six years before we got married. I kind of hang in there, you know. So, I wanted an answer.
Q Did you ask any questions?
A Yeah.
Q Were all the letters alike?
A Basically. Oh, yeah, they're all the same again.
Q One is to the Secretary of the Treasury and one is to the district director?
A Yeah.
Q And one is to ...
A The commissioner.
Q And one's to Nashville, right?
A Right.
Q Okay. Now, they're all alike?
A Right.
Q Okay. And you sent this letter to all three of them to get an answer to what question?
A Well, I wanted to know if I was required to file, you know, the questions I'd been asking basically. And I think in this one they keep talking about these individuals that have gross income. So, I think in this one I asked them to tell me if I was an individual as defined in the IRS code. And let me read right here just a little bit. I said that I appreciate them answering and telling me that they do answer expressly in writing, and then the fact that they told me I couldn't assume anything.
Let me just read this little portion right here. It says, "You tell me in your letter that I cannot presume or infer anything that is not expressly stated in writing in your letters to me. Instead of saying expressly yes or no, you appear to be avoiding my questions by stating Section 6012 about individuals and gross income again. It appears to me that you are trying to make me presume or infer that I am one of these individuals that you refer to in your letter. Therefore, would you please state to me expressly in writing, 'Yes, Mr. Long, you're a native born citizen of Tennessee, domicile therein, and having no licenses or privileges issued by the federal government, are an individual as defined in the IRS code.'" You know, yes or no.
And then I said, "It also appears that you're trying to make me assume that I'm self-employed." So, I said, "If you cannot say to me expressly in writing, 'Yes, Mr. Long, you, a native born citizen of Tennessee, domicile therein, and having no licenses or privileges issued to you by the federal government, are self-employed.'" So, I put it in a way that I hoped they'd have to answer. And then I said, "Since you are experts in this field, and according to your letter you do state things expressly in your letters to people, I am eagerly awaiting your express statements as to my being an individual or self-employed as defined in your IRS code." I went on to say then, "However, if you cannot or will not state positively and expressly that I am an individual and am self-employed as defined in your IRS code and the sections you refer to me in your letters within 15 days, I must expressly presume or infer that this is prima facia evidence and that I am not an individual or self-employed as defined in your IRS code and sections you refer to me in your letters. "In addition to answering the questions above, please send me a copy of your order of authority given by the Secretary of the Treasury to the commissioner of the IRS granting him the authority to assess a tax or file a Form 1040 for a citizen of Tennessee, domicile therein."
Q Did you get an answer?
A No, sir.
Q Now, that was apparently decided February 28 of 1990. When did you mail it off, those three letters?
A It was mailed January 10, 1990.
Q That one?
A That one. The one you've got, yeah. Have you jumped head of me?
Q The ones we just talked about.
A Yeah.
Q You notarized them on February 28, 1990. You sent them certified mail?
A Right.
Q If you notarized it February 28, 1990, would you have mailed it about that time?
A Something like that.
Q And did you have a return receipt showing they received it?
A Yes.
Q Now, let's move on to the -- what letter is the next one?
A Well, this is the same identical letter. Since they didn't answer it, I just copied it again. I thought, "Well, maybe they got lost or maybe they just didn't have time to answer them." So, I sent the same letter to the same people again. And this was, I'm showing it mailed March 2, 1990. And it's got a typo on it. It was supposed to be have been written January 9, '90, but I hit "12" instead of 01."
MR. BECRAFT: (To the clerk.) Could you show him this, please?
Q Now, that's Exhibits No. 12. You made copies of --
A What we've done is I've got two sets of letters in that other exhibit. This is the next one.
Q Okay.
A This is letter four.
Q All right. Is that the one that's...
A Yeah.
Q Okay. Letter four?
A Yeah.
Q Now, 12 that you've got there in front of you, or proposed Exhibit No. 12, have you got your originals?
A Yes, sir.
Q You made copies of it, accurate copies?
A Right.
Q Those are letters you mailed to the IRS?
A Yes, sir.
MR. BECRAFT: Your Honor, I'd move for the admission of 12.
THE COURT: Received. (Defendant's Exhibit 12 was received into evidence.)
MR. BECRAFT:
Q Mr. Long, you're at, in your book, those particular ones?
A Right.
Q Could I get the exhibit back from you now?
A Sure.
Q Now we're on the same set of letters?
A Right.
Q Now, tell the jury what this is.
A Well, here again I keep trying to get answers. And I mailed that other letter, the last letter twice and got absolutely no reply. So, I decide, it's getting close to filing time again, and so I decide, "Well, you know, I'm not trying to hide nothing here. I'm trying to get some straight answers from these folks." So, by this time I've got my 1099s from Maury County Board of Education and from Grower's and I think one from the credit union. So, I make copies of all my 1099s. I make a copy of my contract with Maury County. And I write a little letter and I explain to them, I sent this to all four -- let's see. Yeah. I sent one to the Secretary of Treasury, the commissioner in Washington, to both district directors in Tennessee. I sent, like I say, copies of 1099s, my contracts. And this was mailed on March the 7th.
Q Now, it's dated, my copy has there 2/27/90 at the top of the page?
A Right.
Q And you signed it the 28th?
A Yeah.
Q Okay. February has got 28 days in it.
A Right.
Q And then you mailed it --
A I mailed it March the 7th.
Q Now, if the jury had this in front of them, would all four of these letters, or however many we have here, be identical?
A Right.
Q Except for who it's mailed to?
A Right. That's all.
Q This exhibit also has a one-page reply at the very end?
A I believe that's correct.
Q Now, why did you mail this set of letters? Let's talk about them all in a group.
A Well, here again, I'm trying to get straight answers. I ain't trying to hide nothing. I'm just who I am. I'm asking questions that I feel like need to be answered, and I'm not getting answers. So, you know, there's a lot of fear out here. I know what I know. I believe what I know. But I want to give the Internal Revenue Service, since they're such as a service, a chance to correct me if I'm wrong; and at least give them an opportunity to show their good faith. So, I write, you know, it's the same letter. And what I say is, "After inspecting the documents, please answer this question for me. Would the dollar amounts shown in Box 7 of the 1099 miscellaneous forms and the dollar amount shown in Box 1 of the 1099 INT form, or any portion of the dollar amounts in either of these forms, be considered income as defined in the IRS code for me, a native born citizen of the commonwealth of Tennessee, domicile therein."
And I wrote on, I said, "If in your expert opinion you feel that these dollars amounts would be considered income as defined in the code for me, a native born citizen of Tennessee, domicile therein, please answer my question clearly and expressly, 'Yes, Mr. Long, for you, a native born citizen of Tennessee, domicile therein, and having had no licenses or privileges issued to you by the federal government, the dollar amount shown in the boxes that you mentioned and the dollar amount in Box 1 of the 1099 INT form, or portions of this amount, would be considered income as defined in the IRS code and would require you to file a IRS Form 1040.'" Now, I wrote that so that -- and I wanted them to come back and tell me yes. Then I said, "If you cannot or will not answer me expressly yes, and in the manner stated above, within 15 days of receipt of these documents, then I must presume this to be prima facia evidence that the dollar amounts on the 1099s herein are not income as defined in the IRS code for me, a citizen of the state of Tennessee, domicile therein." And then it's notarized.
Q Now, you sent it to what, three or four different people in the IRS?
A Four. It went to the Secretary of the Treasury too.
Q Now, you sent this letter, said the same thing, and everybody got copies of your 1099s?
A Right.
Q You've seen what the government showed you made for 1989, right?
A Right.
Q Did you give to them everything in this letter? You give them Maury County, you give them -- did they show that there was anything more on their side of the case?
A No, sir. No, sir. It was identical to what I sent them.
Q So, what they showed you made during the course of this trial for '89 is what you'd already given to them sometime in the early part of '90?
A Right.
Q Now, did you receive a reply to this?
A Well, I got a reply back that they had received my letter but that the documents weren't attached. This was in Memphis. So, I mailed them again. I sent them to the Memphis Service Center. And then this time I got, they sent them back and stamped them where they had received them.
Q Okay. The first batch you mailed had the exhibits attached to it?
A Yes, sir.
Q That was in March?
A March.
Q All right. Then when did you mail it to them again?
A I don't know if I've got that date. They received them April the 2nd.
Q The second set?
A Yes, sir.
Q What did you do? Did you make copies of it all over again?
A Uh-huh.
Q And you just stuck that in the mail?
A Right.
Q So, twice Exhibit No. 12?
A Yes, sir.
Q Was mailed to them?
A Right.
Q Okay. Now, they received it by April 2nd?
A That's what it says, yes, sir.
Q Now, did you receive a reply?
A Finally got a reply, and it was dated Nay 15th.
Q What did you learn from this? Now, Ruth Hill has already responded to you in the past, correct?
A Uh-huh.
Q Ms. Hill is also responding to this set of letters?
A Right.
Q what did you learn by reading the letter that she mailed back to you?
A Well, in this letter she goes to talking about Section 61 of the code, about wages, salaries, and compensation for services and all this kind of stuff being included in gross income. And she also states -- and this blew my mind. Said the current federal tax law is the Internal Revenue code which does not define the general term "income," that income -- gross income, it says, not income, is the starting point of determining an individual's federal income tax liability. Well, now, I'm an ol' country boy, folks. And there's no definition of income in this whole book? And it starts at gross income? Well, now, if you want to know what a gross dog is, you've got to know what a dog is, don't you? And then at Section 61 it says gross income is all income. Well, if you don't define income in the first place, how are you going to know what all income is? Then you've got to go to gross income. So, there's no definition for income in this whole book, and yet they're out here collecting income taxes everyday. That blew my mind.
Q The answer that you got back?
A Yeah. No definition of income in the whole code?
Q I've lost myself. This set of letters is what you called the fourth set of letters?
A Yeah.
Q Now, I've got -- again on Monday you made copies of the next set of letters?
A Right.
Q You have them in your book?
A Five. Yes, sir.
Q And you made copies of all the letters that are in this packet of letters labeled Defendant's Exhibit Ho. 13? These are letters you mailed to the IRS?
A Yes, sir. Uh-huh.
MR. BECRAFT: Your Honor, I'd move for the admission of 13.
THE COURT: Received. (Defendant's Exhibit 13 was received into evidence.)
THE COURT: Let's take a recess. We'll be in recess for about ten minutes. (Brief recess.)
MR. BECRAFT: May it please the Court.
MR. BECRAFT:
Q We were on Exhibit No. 13, Mr. Long. Are you still at it?
A I believe so. It's probably my letter number six.
Q Whatever it is. It's the one that's dated July 20th of '90 at the top of the page?
A Right.
Q Now, you made some letters and sent them to what, the Department of Treasury, district director in Memphis?
A Both district directors and then the commissioner in Washington.
Q So, four letters?
A Four letters. They say the same thing.
Q And you mailed it to them sometime around the date that it's stamped?
A Yes, sir.
Q What was that date?
A July 26th.
Q And it was received?
A Right.
Q Why did you mail this other set of letters?
A Well, I didn't get my reply back until, you know, after the filing date, and it was beginning to get on up close to the other one and I wanted an answer. They still hadn't answered yes or no. They hadn't told me I was required. They tell me there's no definition of income. And I'd asked them to tell me that this was income, you know, that would require me to file. They didn't do that. So, I thought I'd write them again.
Q Can you summarize for the jury what you were seeking by these letters that you wrote in July of '90?
A Well, let me just read the two. "Am I, Lloyd R. Long, a native born citizen of Tennessee and domicile therein, and having never applied for or received any license or privilege from the federal government, liable for any type of federal tax, income or otherwise? Simply yes or no." And the second one was, "Do the dollar amounts represented on the 1099s bearing my name represent anything other than an information return documenting an equal, nontaxable exchange between two contracting parties? Yes or no." And then I went ahead to say, "If you cannot or will not state simply, within 20 working days, then I must assume that I'm not." Basically that's what I said.
Q Now, did you receive any answer or reply?
A No, sir, I didn't.
Q What did you do next?
A Well, I sent it again.
Q I don't know what we called this. I've got some letters of January 14th of '91.
A That's it.
Q Is that the next set of letters?
A That's the next.
Q You've got the originals, your copies?
A I got them right here.
Q Monday you made copies of this?
A That's correct.
THE COURT: We need to move on here.
MR. BECRAFT: Okay, Your Honor. I move 14 to be admitted.
THE COURT: Fourteen is received. (Defendant's Exhibit 14 was received into evidence.)
Q Can you briefly tell the jury what you were trying to accomplish? What was the purpose of writing these letters?
A Same purpose. I just wanted them to tell me straight out. You know, I'm an ol' country boy. I've asked a straight question expecting a yes or no answer and they won't give me one, and they keep coming back with 6012 about individuals and gross income. If that's what it says, why can't they tell me yes? That's all I want to know.
Q Were you asking the -- the previous exhibit that we've just admitted, is it basically the same thing as this letter?
A Yes, sir. Yes, sir.