Since July 1, the Foreign Account Tax Compliance Act has been in full effect. The Foreign Account Tax Compliance Act decrees that U.S. citizens who live outside the USA to report their financial accounts held outside the USA to the IRS on behalf of Congress. Bizarrely, the law also requires foreign financial institutions to report to the IRS about their customers who are U.S. citizens.
NO ONE who earns income outside the borders of the fifty states which comprise the USA should pay taxes to the U.S. Congress. No one.
Disgustingly, Congress believes they are owed an unearned share of profits of U.S. citizens living elsewhere in other countries like Canada and Australia. It's neither moral nor legally justifiable for Congress to demand taxes from anyone earning income outside the USA. Greedy Congress "men" yearn for this undeserved tax revenue so they can increase the balance owed on their giant-sized Congressional debt credit card, wrongly parroted by most as the "national debt" or "federal debt".
When the authors of the second constitution wrote rules giving Congress the capacity, authority and thus power to lay and collect taxes, those authors wrote their taxation design in Article 1, sections 2, 8 and 9. Enough of the delegates from the various states ratified the constitution enshrining that power into law.
In Article I, Section 2, the authors wrote,
"Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three fifths of all other Persons."
Specifically, Article 1, Section 8 states,
"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;"
In Article I, Section 9, the authors wrote,
"No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census of Enumeration herein before directed to be taken."
"No Tax or Duty shall be laid on Articles exported from any State."
So the authors' made explicit their design:
- Direct taxes shall be apportioned among the several states.
- The congress shall have power to lay and collect taxes.
- Direct taxes shall be apportioned by the results of the census.
- No export taxes of any kind.
In effect, apportionment acted as a block against Congresses from levying income taxes. Later, after the 1895 U.S. Supreme Court declared a federal income tax unconstitutional because it violated this rule of apportionment in Pollock v. Farmer’s Loan & Trust, another Congress decided that apportionment acted as shackles against them, so they passed the 16th Amendment, in which they wrote,
"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."
Interestingly, before the 16th amendment, the Constitution had no mention of income.
Samuel Johnson, the devout Anglican lexicographer first published his A Dictionary of the English Language in 1755. Looking at the third edition, published in 1768 before the writing of the second constitution as well as the tenth edition published in 1792 soon after the writing of the second constitution, we can come to see how the founders thought of income.
Both th 1768 edition and the 1792 edition have revenue and income as synonyms, having an head entries for each word, revenue and income. Both words meant annual profits received from lands or other funds as well as the produce of anything.
Both th 1768 edition and the 1792 edition have revenue as a synonym for the head entry rent, specifcally defining the word rent as annual payment; the money paid for anything held of another.
Both th 1768 edition and the 1792 edition have definition for produce. Produce meant product; that which yields or brings. The secondary definition for produce is amount; profit; gain; emergent sum or quantity.
Both the 1768 edition and the 1792 edition have definition for yield. Yield meant to produce; to give in return for cultivation or labor.
So those who drafted and ratified the second constitution had in mind earnings from land whether crop sales or rent, as well as interest from loans as the source of taxes. Never did the so-called founders or framers envision taxing anyone's labor income.
After 1895, Congress demonstrated by action they needed to define income as more than rent and interest, hence, this is why the 16th amendment includes the phrase "from whatever source." Further Congress demonstrated the need to rid itself of the pesky apportionment rule, hence the phrase, "without apportionment among the several States."
Yet, it is quite clear that in the second constitution, the ratifiers authorized taxation only with respect to the states and the Congress which drafted the 16th failed to expand taxation beyond states.
Thus, IRS rules regarding taxation of Americans as U.S. citizens living outside the USA and FACTA are quite unconstitutional. In short, Congress lacks authority to levy taxes upon anyone outside the territory of the USA and specifically the states.
If Congress had that authority, the Constitution would contain something along the lines of what would be construed as absurdity by everyone, e.g.,
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, without regard to any census or enumeration, without regard to citizenship or domicile, upon anyone living the earth over.
Congress needs a geography lesson. No one living in the 193 U.N. member countries, nor living in the 206 sovereign countries, nor those living in the U.S. possessions of American Samoa, Guam, Northern Mariana Islands, Puerto Rico or the U.S. Virgin Islands, as well as the free association countries of the Marshall Islands, Micronesia, and Palau owes Congress a penny, much less a dime.
There is no constitutional basis for Congress to claim the right of taxation neither on U.S. citizens living outside the USA nor upon foreigners wherever they live the earth over, except within the boundaries of the actual fifty states that constitute the USA.