Tax Exemption

Tax Exemption Through Use of Lawful Money to End the Fed

The truth about the income tax, the national debt, the Federal Reserve, and what you can do about it.

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Fed Note vs US Note

Top: Federal Reserve Note. Bottom: United States Note

Besides the “Federal Reserve Note” on the scroll at the top of the note, the fed note has a green seal and serial numbers and the US note has red.

Use the green money, the debt grows and you own nothing. Use the red money, the debt goes down, you are tax exempt, and you own what you buy. Simple as that.


The following article explains the legalities in detail, along with the remedy. THIS IS NOT THEORY, THIS IS FACT. IGNORE THIS AND YOU DESERVE WHAT’S COMING:

Public Money vs. Private Credit

July 4, 1861 Abraham Lincoln re-convenes congress under an ‘extraordinary occasion’ that is technically still in-place today [Lincoln’s order convening Congress was by proclamation set forth 15 April 1861]. It had adjourned sine die since March 28 1861 [by March 28, the southern congressmen had walked out of session. That, combined with uncertainty as to Lincoln’s military intentions, led the remaining members of the 37th Congress to agree to adjourn without setting a day to reconvene — sine die means without day]. The congress today is still a [Lincoln convened, executive] de-facto congress. [To my knowledge, congress still adjourns sine-die, informing members of the re-convention date during the recess]

Twenty eight days prior to congress adjourning sine die, we find that the territory of Colorado was formed and would have taken 30 days to form properly. President Buchannan was actually lining up Colorado with the gold claims found in Aurora and Central City to be the war chest for prosecuting the war between the states [erroneously referred to by many as a civil war — which it was not] from the union side. Colorado was basically a union state.

President Lincoln got the election, so he moved into President Buchanan’s plans. The first territorial governor, governor Gilpen, issued notes. These are the predecessors to the United States notes called green-backs. If we take a look at the treasury, their website, we find this particular page regarding legal tender

Legal tender status. Now pay particular notice to the bottom of the page:

United States notes serve no function that is not already adequately served by Federal Reserve notes. As a result, the Treasury Department stopped issuing United States notes, and none have been placed into circulation since January 21, 1971.

[Article published by Freedom League 1984:]

When Congress borrows money on the credit of the United States, bonds are thus legislated into existence and deposited as credit entries in Federal Reserve banks. United States bonds, bills and notes constitute money as affirmed by the Supreme Court (Legal Tender Cases, 110 US 421), and this money when deposited with the Fed becomes collateral from whence the Treasury may write checks against the credit thus created in its account (12 USC 391). For example: suppose Congress appropriates an expenditure of $1 billion.

To finance the appropriation, Congress creates the $1 billion worth of bonds out of thin air [actually, created upon a presumption — see David’s comment below] and deposits it with the privately owned Federal Reserve System. Upon receiving the bonds, the Fed credits $1 billion to the Treasury’s checking account, holding the deposited bonds as collateral. When the United States deposits its bonds with the Federal Reserve System, private credit is extended to the Treasury by the Fed.

Under its power to borrow money, Congress is authorized by the Constitution to contract debt, and whenever something is borrowed it must be returned. When Congress spends the contracted private credit, each use of credit is debt which must be returned to the lender or Fed.

Since Congress authorizes the expenditure of this private credit, the United States incurs the primary obligation to return the borrowed credit, creating a National Debt which results when credit is not returned. However, if anyone else accepts this private credit and uses it to purchase goods and services, the user voluntarily incurs the obligation requiring him to make a return of income whereby a portion of the income is collected by the IRS and delivered to the Federal Reserve banksters.

Actually the federal income tax imparts two separate obligations: the obligation to file a return and the obligation to abide by the Internal Revenue Code. The obligation to make a return of income for using private credit is recognized in law as an irrecusable obligation, which according the Bouvier’s Law Dictionary (1914 ed.), is “a term used to indicate a certain class of contractual obligations recognized by the law which are imposed upon a person without his consent and without regard to any act of his own”.

This is distinguished from a recusable obligation which, according to Bouvier, arises from a voluntary act by which one incurs the obligation imposed by the operation of law. The voluntary use of private credit is the condition precedent which imposes the irrecusable obligation to file a tax return. If private credit is not used or rejected, then the operation of law which imposes the irrecusable obligation lies dormant and cannot apply.

In Brushaber v. Union Pacific RR Co., 240 US 1 (1916) the Supreme Court affirmed that the federal income tax is in the class of indirect taxes, which include duties and excises. The personal income tax arises from a duty — i.e., charge or fee — which is voluntarily incurred and subject to the rule of uniformity. A charge is a duty or obligation, binding upon him who enters into it, which may be removed or taken away by a discharge (performance) Bouvier, p 459.

Our federal personal income tax is not really a tax in the ordinary sense of the word but rather a burden or obligation which the taxpayer voluntarily assumes, and the burden of the tax falls upon those who voluntarily use private credit. Simply stated, the tax imposed is a charge or fee upon the use of private credit where the amount of private credit used measures the pecuniary obligation.

The personal income tax provision of the Internal Revenue Code is private law rather than public law. “A private law is one which is confined to particular individuals, associations, or corporations”: 50 Am.Jur.: 12 p 28. In the instant case the revenue code pertains to taxpayers. A private law can be enforced by a court of competent jurisdiction when statutes for its enforcement are enacted: 20 Am.Jur.: 33. pg. 58, 59.

The distinction between public and private acts is not always sharply defined when published statutes are printed in their final form: Case v. Kelly, 133 US 21 (1890). Statutes creating corporations are private acts: 20 Am.Jur. 35, p 60. In this connection, the Federal Reserve Act is private law. Federal Reserve banks derive their existence and corporate power from the Federal Reserve Act: Armano v. Federal Reserve Bank, 468 F.Supp. 674 (1979).

A private act may be published as a public law when the general public is afforded the opportunity of participating in the operation of the private law. The Internal Revenue Code is an example of private law which does not exclude the voluntary participation of the general public. Had the Internal Revenue Code been written as substantive public law, the code would be repugnant to the Constitution, since no one could be compelled to file a return and thereby become a witness against himself.

Under the fifty titles listed on the preface page of the United States Code, the Internal Revenue Code (26 USC) is listed as having not been enacted as substantive public law, conceding that the Internal Revenue Code is private law. Bouvier declares that private law “relates to private matters which do not concern the public at large.” It is the voluntary use of private credit which imposes upon the user the quasi contractual or implied obligation to make a return of income. In Pollock v. Farmer’s Loan & Trust Co., 158 US 601 (1895), the Supreme Court had declared the income tax of 1894 to be repugnant to the Constitution, holding that taxation of rents, wages and salaries must conform to the rule of apportionment.

However, when this decision was rendered, there was no privately owned central bank, issuing private credit and currency, but rather public money in the form of legal tender notes and coins of the United States circulated. Public money is the lawful money of the United States which the Constitution authorizes Congress to issue, conferring a property right, whereas the private credit issued by the Fed is neither money nor property, permitting the user an equitable interest but denying allodial title. [In other words, you cannot really ‘buy’ anything with Federal Reserve Notes.]

Today, we have two competing monetary systems: The Federal Reserve System with its private credit and currency, and the public money system consisting of legal tender United States Notes and coins. One could use the public money system, paying all bills with coins and United States notes (if the notes can be obtained), or one could voluntarily use the private credit system and thereby incur the obligation to make a return of income. Under 26 USC 7609 the IRS has carte blanche authority to summon and investigate bank records for the purpose of determining tax liabilities or discovering unknown taxpayers: United States v. Berg, 636 F.2d 203 (1980).

If an investigation of bank records discloses an excess of $1000 in deposits in a single year, the IRS may accept this as prima facie evidence that the account holder uses private credit and is therefore a person obligated to make a return of income. Anyone who uses private credit — e.g. bank accounts, credit cards, mortgages, etc — voluntarily plugs himself into the system and obligates himself to file.

A Taxpayer is allowed to claim a $1000 personal deduction when filing his return. The average taxpayer in the course of a year uses United States coins in vending machines, parking meters, small change, etc, and this public money must be deducted when computing the charge for using private credit.

On June 5, 1933, the day of infamy arrived. Congress on that date enacted House Joint Resolution 192, which provided that the people [actually, HJR-192 applied only to corporate persons, not to people] convert or turn in their gold coins in exchange for Federal Reserve notes. Through the operation of law, HJR-192 took us off the gold standard and placed us on the dollar standard where the dollar could be manipulated by private interests for their self-serving benefit. By this single act the people and their wealth were delivered to the bankers. When gold coinage was thus pulled out of circulation, large denomination Federal Reserve notes were issued to fill the void. As a consequence the public money supply in circulation was greatly diminished, and the debt-laden private credit of the Fed gained supremacy.

This action made private individuals who had been previously exempt from federal income taxes now liable for them, since the general public began consuming and using large amounts of private credit. Notice all the case law prior to 1933 which affirms that income is a profit or gain which arises from a government granted privilege.

After 1933, however, the case law no longer emphatically declares that income is exclusively corporate profit, or that it arises from a privilege. So, what changed? Two years after HJR-192, Congress passed the Social Security Act, which the Supreme Court upheld as a valid act imposing a valid income tax: Charles C. Steward Mach. Co v. Davis, 301 US 548 (1937).

It is no accident that the United States is without a dollar unit coin. In recent years the Eisenhower dollar coin received widespread acceptance, but the Treasury minted them in limited number which encouraged hoarding. This same fate befell the Kennedy half-dollars, which circulated as silver sandwiched clads between 1965 and 1969, and were hoarded for their intrinsic value and not spent. Next came the Susan B. Anthony dollar, an awkward coin which was instantly rejected as planned.

The remaining unit is the privately issued Federal Reserve note unit dollar with no viable competitors. Back in 1935 the Fed had persuaded the Treasury to discontinue minting silver dollars because the public preferred them over dollar bills. That the public money system has become awkward, discouraging its use, is no accident. It was planned that way.

A major purpose behind the 16th amendment was to give Congress authority to enforce private law collections of revenue. Congress had the plenary power to collect income taxes arising from government granted privileges long before the 16th Amendment was ratified, and the amendment was unnecessary, except to give Congress the added power to enforce collections under private law, i.e. income from whatever source.

So, the Fed got its amendment and its private income tax, which is a banker’s dream but a nightmare for everyone else. Through the combined operation of the Fed and HJR-192, the United States pays exorbitant interest whenever it uses its own money deposited with the Fed, and the people pay outrageous income taxes for the privilege of living and working in their own country, robbed of their wealth and separated from their rights, laboring under a tax system written by a cabal of loan shark bankers and rubber stamped by a spineless Congress.

Congress has the power to abolish the Federal Reserve System and thus destroy the private credit system. However, the people have it within their power to strip the Fed of its powers, rescind private credit and get the bankers to pay off the National Debt should Congress fail to act.

The key to all this is 12 USC 411, which declares that Federal Reserve notes shall be redeemed in lawful money at any Federal Reserve Bank. Lawful money is defined as all the coins, notes, bills, bonds and securities of the United States. Julliard v. Greenman, 110 US 421, 448 (1884): whereas public money is the lawful money declared by Congress as a legal tender for debts (31 USC 5103), 521 F.2d 629 (1974).

Anyone can present Federal Reserve notes to any Federal Reserve Bank and demand redemption in public money — i.e. legal tender United States notes and coins. A Federal Reserve note is a fixed obligation or evidence of indebtedness which pledges redemption (12 USC 411) in public money to the note holder.

The Fed maintain a ready supply of United States notes in hundred dollar denominations for redemption purposes should it be required, and coins are available to satisfy claims for smaller amounts. However, should the general public decide to redeem large amounts of private credit for public money, a financial melt-down within the Fed would quickly occur.

The process works like this: Suppose $1000 in Federal Reserve notes are presented for redemption in public money. To raise $1000 in public money the Fed must surrender US Bonds in that amount to the Treasury in exchange for the public money demanded (assuming that the Fed had no public money on hand). In so doing, $1000 of the National Debt would be paid off by the Fed and thus canceled.

Can you imagine the result if large amounts of Federal Reserve notes were redeemed on a regular ongoing basis? Private credit would be withdrawn from circulation and replaced with public money, and with each turning of the screw the Fed would be obliged to pay off more of the National Debt. Should the Fed refuse to redeem its notes in public money, then the fiction that private credit is used voluntarily would become unsustainable.

If the use of private credit becomes compulsory, then the obligation to make a return of income is voided. If the Fed is under no obligation to redeem its notes, then no one has an obligation to make a return of income. It is that simple! Federal Reserve notes are not money and cannot be tendered when money is demanded: 105 So. 305 (1925).

Moreover, the Ninth Circuit rejected the argument that a $50 Federal Reserve note be redeemed in gold or silver coin after specie coinage had been rescinded but upheld the right of the note holder to redeem his note in current public money (31 USC 392 rev., 5103): 524 F.2d 629 (1974), 12 USC 411.

It would be advantageous to close out all bank accounts, acquire a home safe, settle all debts in cash with public money and use US postal money orders for remittances. Whenever a check is received, present it to the bank of issue and demand cash in public money. This will place banks in a vulnerable position, forcing them to draw off their assets. Through their insatiable greed, bankers have over extended, making banks quite illiquid.

Should the people suddenly demand public money for their deposits and for checks received, many banks will collapse and be foreclosed by those demanding public money. Banks by their very nature are citadels of usury and sin, and the most patriotic service one could perform is to obligate bankers to redeem private credit.

When the first Federal Reserve note is presented to the Fed for redemption, the process of ousting the private credit system will commence and will not end until the Fed and banking system nurtured by it collapse. Coins comprise less than five percent of the currency, and current law limits the amount of United States notes in circulation to $300 million (31 USC 5115).

The private credit system is exceedingly over extended compared with the supply of public money, and a small minority working in concert can easily collapse the private credit system and oust the Fed by demanding redemption of private credit. If the Fed disappeared tomorrow, income taxes on wages and salaries would vanish with it. Moreover, the States are precluded from taxing United States notes: 4 Wheat. 316.

According to Bouvier, public money is the money which Congress can tax for public purposes mandated by the Constitution. Private credit when collected in revenue can fund programs and be spent for purposes not cognizable by the Constitution. We have in effect two competing governments: the United States Government and the Federal Government.

The first is the government of the people, whereas the Federal Government is founded upon private law and funded by private credit. What we really have is private government. Federal Agencies and activities funded by the private credit system include Social Security, bail out loans to bankers via the IMF, bail out loans to Chrysler, loans to students, FDIC, FBI, supporting the UN, foreign aid, funding undeclared wars, etc., all of which would be unsustainable if funded by taxes raised pursuant to the Constitution.

The personal income tax is not a true tax but rather an obligation or burden which is voluntarily assumed, since revenue is raised through voluntary contributions and can be spent for purposes unknown to the Constitution. Notice how the IRS declares in its publications that everyone is expected to contribute his fair share. True taxes must be spent for public purposes which the Constitution recognizes. Taxation for the purpose of giving or loaning money to private business enterprises and individuals is illegal: 15 Am.Rep. 39, Cooley, Prin. Const. Law, ch IV.

Revenue derived from the federal income tax goes into a private slush fund raised from voluntary contributions and Congress is not restricted by the Constitution when spending or disbursing the proceeds from this private fund. It is incorrect to say that the personal federal income tax is unconstitutional, since the tax code is private law and resides outside the Constitution.

The Internal Revenue Code is non-constitutional because it enforces an obligation which is voluntarily incurred through an act of the individual who binds himself. Fighting the Internal Revenue Code on constitutional grounds is wasted energy. The way to bring it all down is to attack the Federal Reserve System and its banking cohorts by demanding that private credit be redeemed, or by convincing Congress to abolish the Fed.

Never forget that private credit [central bank credit] is funding the destruction of our country.

[Reprinted from ‘Freedom League’, Sept/Oct 1984]

By demanding non-negotiable Federal Reserve Notes at the time of cashing any paycheck, you’re avoiding the taxable event:

Redeemed in lawful money Pursuant to 12 USC 411
:True Name: dba LEGAL NAME

You’re avoiding the activity — or the verb — of endorsement. [Actually, I believe it is a restrictive endorsement because it ‘restricts’ how the bank may negotiate the instrument.]

Negotiable instruments can be exchanged for other and presumably higher forms of currency. So a nonnegotiable Federal Reserve Note is a way of saying that you’re getting United States Notes instead. This is domestic emergency currency, instead of foreign emergency currency (Federal Reserve Notes). The problem with this non-endorsement as far as the bank is concerned, is that the bearer of the check is not pledging any credit; any private credit behind the check.

[The Story of Money — Federal Reserve Bank of New York]

The only bond behind the check is the presumed goods or services, and the full amount has to come out of the bank account of the drafter — whoever drafted the check. This means that the bank cannot do any fractional lending; for every $10 that’s put into the vault, they can’t lend out $90 more. And so this is what it means in the article by it diminishes the private credit. You’re actually redeeming the private credit from the Federal Reserve and putting it into public money form — non-negotiable Federal Reserve Notes. They still look like Federal Reserve Notes…

To summarize and paraphrase, the opening paragraphs of the article are a little misleading to say that the $1 billion in bond money is created out of thin air. It’s created, actually out of a suppositional wagering scheme or a tontine that everybody will be fooled into pledging themselves as national debt.

David Merrill

Statutory citations:

12 USC §391
Federal reserve banks as Government depositaries and fiscal agents.

The moneys held in the general fund of the Treasury, except the 5 per centum fund for the redemption of outstanding national-bank notes may, upon the direction of the Secretary of the Treasury, be deposited in Federal reserve banks, which banks, when required by the Secretary of the Treasury, shall act as fiscal agents of the United States; and the revenues of the Government or any part thereof may be deposited in such banks, and disbursements may be made by checks drawn against such deposits.

12 USC §411
Federal reserve notes, to be issued at the discretion of the Board of Governors of the Federal Reserve System for the purpose of making advances to Federal reserve banks through the Federal reserve agents as hereinafter set forth and for no other purpose, are authorized. The said notes shall be obligations of the United States and shall be receivable by all national and member banks and Federal reserve banks and for all taxes, customs, and other public dues. They shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank.

31 USC §5103
United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. Foreign gold or silver coins are not legal tender for debts. [Notice that there is no reference to ‘private’ obligations]

31 USC §5115
(a) The Secretary of the Treasury may issue United States currency notes. The notes—
(1) are payable to bearer; and
(2) shall be in a form and in denominations of at least one dollar that the Secretary prescribes.
(b) The amount of United States currency notes outstanding and in circulation—
(1) may not be more than $300,000,000; and
(2) may not be held or used for a reserve.

95 Responses to “Tax Exemption”

  • Spencer Pfaff

    Why is the “Fed” getting so much press of late…negative or not? Why are there glimmers of REAL monetary reform being communicated in the media by the likes of FOX (We FIX your news the way we want), CNN and the like? Why do you, “Storm Thunder”, endorse Glenn Beck & Ron Paul when they are obvious coadjutors of the ruling elite? You are obviously sharp…and you dont know that?

    My oh my…where are the neo-statist drones and prostitute-banking shills of the oligarchs taking us now?

    My apologies if I’m way off base!

    • Tom

      Hi Spencer,

      I think the reason the Fed is getting attention now is because of the Internet. There is no way to control information anymore. It makes sense if you think about it. For years, the “establishment press” could be kept in the pocket and information could be and was tightly controlled. That’s not possible anymore.

      I don’t know what “glimmers” you are talking about. I see no monetary reform anywhere. I see people who should know better talking about everything but the Fed. It’s insulting.

      Either they know and are protecting it, or they don’t know and have no business being where they are.

      As for me, I don’t know where you got the idea I endorse Glenn Beck. I haven’t made up my mind. Until a few weeks ago, I was sure he was a shill. Talking about “all this stuff” while never mentioning the real source of the power or the problem.

      It’s not that those things aren’t happening, they just aren’t the main source of the power. Recently though he did start talking about the Fed. Could be he was just protecting his family. Could be he’s mentioning now because he’s leaving Fox. Don’t know, don’t care. The only thing that’s important is that the truth be revealed.

      As for Ron Paul, I think he’s owed a big apology by most. He saw the truth years ago and was laughed at for saying “End the Fed”. Turns out, he was the only one, the only one with his finger on the solution.

      I don’t see that he’s part of that group at all. I think from what I’ve seen of Rand Paul, he’s cut from similar stuff, but we’ll see.

      Thanks for the comment!

    • BigIron

      Ron Paul is the only candidate currently running for president that I will endorse, campaign for, or vote for. He has proven himself during his tenure in the US House to be a champion of our Country, our Constitution and the people, refusing to support any bill he has determined to be unconstitutional. His currently ongoing fight against the Federal Reserve is what has awakened many of us to the EVIL that is the Federal Reserve and its roll in stealing the wealth of the American people. The Federal Reserve in NOT necessarily an inherently corrupt concept but the Fed was conceived in corruption and has been so for the almost 100 years it has endured.
      Ron Paul is currently being deliberately ignored, marginalized and maligned by the “conservative” media and the “conservative” talking-heads as being “unelectable”.
      Let’s face it both the liberal and conservative both are both but “minions” of the “power elite”. for their own ends, not ours; whatever they support so does the “power elite”.
      Rush, Hannity, etc. , these are just “place-holders” to do the bidding of the PE and to fill the need for a conservative presence that would be a vacuum that might be filled with “real” conservative personalities were they not already occupying that niche.
      Of the current front runners:
      Herman (I’m the Fed) Cain: Vice-Chairman, Chairman, member of the Board of Directors of the Federal Reserve Bank of Kansas City … until he resigned to enter “national” politics.
      Rick (I’m a Bilderberger) Perry: He was tapped by the Bilderbergers when he was invited to and attended the 2007 Bilderberger meeting.
      Mitt (I’m the Establishment) Romney: Besides just being a longstanding member of the establishment check out his ?possible? involvement in the theft of Ed Falcone’s millions of dollars; I believe this is currently in the International World Court.
      I wouldn’t give a “plug nickle” for any one of them. For the rest of the field, with the singular exception of Ron Paul (Michelle Bachman in a few years maybe) , not “a dime for the lot”.

  • Keith

    I am feeling sick to my stomach because I don’t think I can do anything about getting lawful money without risking my career and/or being prosecuted or harassed by the Feds and IRS.

    • Tom

      Hi Keith,

      Well, all I can say is thank God the founders never had that attitude, where would we be?

      Look, I understand what you’re saying, but there is nothing wrong with redeeming lawful money. As I have shown, it’s in the law. It’s not like there is anything at risk.

      Even if you are still going to pay your taxes, just redeem lawful money anyway, how can you get in trouble for that?

      At least you’ll be changing the way the banks do their accounting and won’t be contributing to the national debt.

      Everyone must do what they can.

      Thanks for commenting.

      • Keith

        You seem to have a very good knowledge of law, history and economics. The reason I am reluctant to do anything is because I do not fully understand the definitions to the point that I could argue my case; terms like suitors case, elasticity of currency, remedy, fractional lending, etc.

        The eyes and ears of many of us who watch this begin to dull after watching a few minutes of the video. We all agree that our leaders should be following the Constitution and want to end corruption, but perhaps you can cut right to the chase by explaining WHAT to do and specifically HOW to do it before explaining WHY we need to do it.

        Can you please just spell out exactly what we need to do to help dissolve the Federal Reserve and the IRS (or at least our obligations to them)?


        • Tom

          Hi Keith,

          The details you’re looking for are here:


        • chris

          at a minimum, you should pay all work and purchases from small operators with other than a check, cutting the revenue from this rigeme is the quickest way to bring it to its knees and justice. after colaspe than we can return to lawful constiutional operation of a non abusive regieme with no socialism operating or concived. If you cannot address the criminal directly and I know it is intimidating, weaken them by assisting others by cutting their money supply, if they have not the revenue to assault your neighbor then they will have to go elsewhere to earn a living and drop their terrorism. further , non of these entities are lawful, we have discovered that any mail coming from them file it promptly in the file 13 where it belongs, I have found that you will generally not hear further from them. Unless it was registered and you signed for it no one can declare that you ever received anything at all. unless they send a official directly to see you face to face they really don t recognize themselves that they have a reson to question you

    • BigIron

      I am endorsing my checks in such a way that lawful money is required. I am also including the UCC term “without prejudice” above my signature (which includes DBA name) and both “signature is not an endorsement of private credit” and “all rights reserved” below my signature. (Yes, it can all be made to fit. I printed the first check endorsements on the checks using my printer and then had a stamp made). I then sign them and make copies of the front and back of each check and then staple the deposit slip to the copy. So far I’ve cashed about 15 checks with never even a hiccup.
      My test of the system was to be as follows: In order to stay in honor of the “adhesion” contracts I would make my usual 1040 return and pay any taxes that were due as if I was using FRNs only. and then file an amended return with the request for the return of the tax on the “lawful money” for which I had already payed the taxes. I would also have included my reasoning of why I thought I was owed that refund. I believe that in this way I would have avoided the pitfall of falling into “dishonor” of the contract/s and also anything that might be construed as fraud. Fortunately or unfortunately, I didn’t get a chance to test this scenario as it has been such a bad year that, in the end, I owed no taxes. Still, I wonder what the reaction of the IRS would have been to this approach. Still stampin’, copyin’, and cashin’ … and hopin’ for a better next year!

      • Tom

        Hi Jerry,

        I don’t think the UCC is necessary, it’s like “spraying and praying” (automatic gunfire). One does not need to throw everything one has at the problem and hope that one of them was the right one. This is codified US law, thus, US law is all that is required. I don’t think it will hurt anything the way you have dome it, but it tends to bring a l lot of “patriot propaganda” into the argument.

        I think that filing is correct, because it will be assumed that you are transacting in credit if you have bank accounts. Some on the forum have mentioned filing zero returns with copies of the their restricted endorsed checks from the first of the year, middle and end of the year as proof of their tax exempt status. This is still new ground, but the anecdotal evidence is that the IRS has accepted them. At least one that I heard about specifically in an audit. The auditor was presented with the copies, and after his review came back and said there was tax owed on three checks that did not have the endorsement on them. So take from that what you will. It’s all hearsay at this point.

        Even if it had happened to me personally, it would be hearsay to you, so courage is required :-)

        Keep it up!

    • Tony

      That’s the way slavery works. You want to do something to escape. But you have been beaten into submission and to afraid to do anything about it.

      • Tom

        Sad but true.

    • YoOle Me

      G’Day Keith; here’s a simple fact of this type transaction that should ease your mind:

      Look at the face of your check – issued or received – and notice the statement beginning the line upon which the “Payee” name is written (you, if you’re receiving; whomever you write-in, if you’re remitting). That line’s beginning statement: “Pay to the Order of __[THIS NAME]__”, makes the named person, the lawful authority for ORDERING the DISBURSEMENT of the proceeds from that “check[ing]” instrument. The method by which we (the “Payee”) ISSUE THAT ORDER TO PAY THOSE FUNDS, we normally call an “endorsement.” But herein turns the nefarious-worm, within YOUR fully lawful & legal endorsement act:

      If you recall, in 12 USC § 411 above, the opening statement reads:
      “Federal reserve notes, to be issued at the discretion of the Board of Governors of the Federal Reserve System for the purpose of making advances to Federal reserve banks through the Federal reserve agents as hereinafter set forth and for no other purpose, are authorized. …”

      Now let’s DE-LEGALESE that opening statement – i.e. WITHOUT its nefarious clausal-manipulations:

      “Federal reserve notes ARE AUTHORIZED to be issued … FOR the purpose of making advances to Federal reserve banks through the Federal reserve agents as hereinafter set forth AND FOR NO OTHER PURPOSE. …” [ALL emphasis mine.]

      UNLESS YOU, (Keith: {Your lawful surname}, the Lawful living soul Man) ARE A CHARTERED FEDERAL RESERVE BANK – which I’m going to assume YOU ARE NOT: THEN in fact & law – BY ACCEPTING FRN’s, AS “Federal reserve notes are authorized to be issued … for the purpose of making advances to Federal reserve banks … and for no other purpose. …” – YOU, Keith: {your lawful surname} HAVE COMMITTED A FRAUD!!! … albeit; enter your nefarious Corporate “TRANSMITTING UTILITY” a/k/a YOUR ALL-CAPS “KEITH {LAWFUL SURNAME}” idem sonans, our wonderful 1865 defacto 13TH & 1868 pseudo-14th Amendment[s], constructive trust “Democracy” Slave-Masters by operation of law, have so conveniently CONSTRUCTED for We the (MUSHROOM) People of the united states of America to LEGALLY ENSLAVE OURSELVES!!! … (Ahh; But I digress.)


      The 1789 Founders WERE FIRST-HAND KNOWLEDGEABLE IN THIEVES OF THIS NATURE, AND SO: Within the Federal Judiciary Act of 1789 (notice that date within the Treasury seal on notes), they gave us the “saving to suitors” clause, and thus: As COMPELLED users of FRN’s – SO UNWARRANTED WITHIN SCOPE AND INTENT of 12 USC § 411; We Simply EXERCISE OUR BUILT-IN REMEDY, per the § 411 closing “saving to suitors” clause, to wit:

      “… They [FRN’s] shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank.

      ERGO: AS I have DONE, within the “Endorsement” area of My SSA TREASURY CHECK, and all other monetary instruments, I may have receive & deposited these past several years: You may specify:

      Redeemed in lawful money
      Pursuant to 12 USC 411
      John Quincy: dba JOHN Q. DOE
      [Do the dba exactly as it is on your checking account documents]

      IMHO there is no BETTER RESEARCHED, NOR GREATER AUTHORITY on this subject-matter, than: David Merrill!!!! … WHEREVER you may find him: LISTEN WITH UTMOST ATTENTION!!!!

      NOW: Aren’t you glad I didn’t have a “Complicated fact” to offer here?!?!

      God Speed,
      YoOle Me

  • Michael

    It\’s a lot to take in, it\’s difficult to keep in line with the time line. Bottom line, how do I get my 401K dollars I\’ve saved all my life into a state or real money versus Reserve notes… That\’s what I\’m pondering right now… Also it sounded like Tom was saying if I pay my house payment with reserve notes — I don\’t really own it… So how does one pay their mortgage in real money versus notes to protect their property? I\’m a bit confused here… I\’ve also never heard of our government seizing people\’s homes on the claim their reserve notes did not afford them the protection of their property based on their payment with reserve notes versus real money…

    • Tom

      Hi Michael,

      So, you’ve never heard of anyone losing their home for not paying taxes? Odd… I sure have.

      It’s very simple, every time you get a check, instead of signing it, just put the restricted endorsement of the back where the signature normally goes.

      Make a copy of it, front and back. That’s it. You have lawful money. No bank can dishonor it. They try. They try to intimidate, or blow you off, because they can’t fractionally lend against your substance.

      The simple way to get any bank to honor the law is bring a copy of the law with you, or ask the low level bank manager that is telling you you can’t do what you’re doing, to call their legal department and to give you their refusal in writing along with his or her name.

      I know hundreds, maybe thousands of people are redeeming lawful money, and have been for at least 2 years, including myself. The banks are a little more used to it now. When we first started, it was much more difficult.

      People actually had to order certified copies of the law from the county clerk and bring it to the bank with them.

      Look the law is the law. This is not a loophole or a trick. This is remedy required by the Constitution. It can’t be changed, because it’s unconstitutional for the government to “require” people to bond themselves to debt.

      You have to volunteer, and you do, every two weeks. No Federal Reserve Bank can refuse this law. What is a Federal Reserve Bank? All of them. B of A, Wells Fargo, Citi, etc.

      Thanks for the comment.

  • Sully

    I have been looking for this since reading “The Creature from Jekyll Island”. I knew they always had to have a backdoor to allow people out – they can’t force you to participate in the theft/fraud – but con’t make it easy to find the answers so most people give up.

    I have seen it argued that Title 12 USC 411 is only for communication and business between member banks and the FED, that individuals are not a Party to this Act. How does using the Restricted Endorsement make me a Party to the Act and allow me to remove myself from the system?

    • Tom

      Good catch Sully. Your right, but what you didn’t look up is that that is precisely all Federal Reserve Notes are supposed to be for as well… member banks.

      It is a point that has been brought up in the forum, and argued. FRN were only to be used by member banks.

      If you’re looking at Sec. 16 Fed Act, you’ll see that. How then is it possible for “we the people” to have Fed notes?

      But we surely do. To me that means we must all be considered Fed Banks. The moment one bonds oneself to private credit (via signature, voluntarily) you are either considered a member bank or a fed bank.

      You are not “under” the Act until you “sign” for it (via signature) that you are. But if you do, you’re in. The remedy is also available under USC 12 ss 411.

      We have all been “self bonding” ourselves into chattel.

      “In this case, The FED ACT of 1913 codified at 12USC411 provides remedy from the tax liability associated with the endorsed use of FED’s private credit. That is all. In 1933 the contract with the FED was opened to all citizens who were persuaded to change the way they deposited their salary checks…

      Franklin D. Roosevelt after the Banker’s Holiday in 1933 on March 6th during the address at the White House Governors’ Conference…

      “Recognized Government bonds are as safe as Government currency. They have the same credit back of them. And, therefore, if we can persuade people all through the country, when their salary checks come in, to deposit them in new accounts, which will be held in trust and kept in one of the new forms I have mentioned, we shall have made progress.”

      Quoting from the Congressional Record of 1933;

      “…The money will be worth 100 cents on the dollar, because it is backed by the credit of the Nation. It will represent a mortgage on all the homes and other property of all the people in the Nation.”

      Those who identify themselves with the full or legal name are the “FED BANKS” who choose to redeem in lawful money. Those who do not identify themselves with the full or legal name either direct the trust to redeem lawful money or they only accept cash which is redeemed lawful money since the holder never bonded him/herself behind the potential elastic increase of the currency. That paper, then, is essentially an IOU slip from the United States of America which people may, or may not, place value in. Currently most people do and one can exchange that paper for good and services.” – Anthony Joseph

      “Technically, if one forms and keeps the full and accurate record of one’s demand for lawful money, the notes they hold should hold their value in the sense that they should be treated as US Notes being on par with the $42.22/oz gold being earmarked by the Treasury at that value on the WORLD BANK/IMF’s international market.” – Anthony Joseph

    • Tom

      Before I get another comment about how member banks have to buy stock in the Federal reserve let me ask…

      What do you think Federal Reserve notes are?

      They are stock certificates in the Federal Reserve. Is that not what you have accepted?

  • Genaro (Two Oaks) Luis

    How does redeeming for lawful money apply, if one is using the direct deposit?

    • Tom

      If you are using direct deposit then you must have your restricted endorsement on your signature card that you filled out when opening the account. You will need to fill out a new one. They will not want you to, and may even try to tell you that you can’t. This is a lie. It’s the law and they have to.

      People have actually got a notarized copy of the actual law (USC Title 12 411) and brought it into the bank, where the bank did ultimately have to let them resign their card with the restricted endorsement.

  • David

    So let me see if am following this correctly.

    The Federal Reserve Issues issues paper money. By using or accepting this money you enter into contract to pay them a income tax based on the amount of money you take in. In normal situations this would be all your income so thus you would pay 30% or whatever your tax bracket is on all the money you have recieved that year (the net amount after any tax breaks or execemptions they allow). And since your employer uses (a representation of) Federal Reserve Notes to issue paychecks, by cashing your paycheck normally you are accepting Federal Reserve Notes.

    So you deposit a check into your bank account. You sign it with “[DEPOSITED FOR CREDIT ON ACCOUNT OR EXCHANGED FOR NON-NEGOTIABLE FEDERAL RESERVE NOTES OF FACE VALUE]”. The money still goes straight into your account like it normally would, or you cash it and recieve the exact same type of paper Dollars you would have normally. However due to the way you signed it, the money you are recieveing now takes on a secondary role as serving as United States Notes instead of Federal Reserve Notes. You have presented a document with value based on Federal Reserve Notes and you have redeemed it for the same value but in United States Notes which is not under jurisdiction of the IRS. You then keep track of all these checks and deposits for the period of the tax year. You are then able to add up the amounts, and that amount is not eligable to be taxed by the IRS because it was not issued as Federal Reserve Notes. You still have to file an IRS form each year and the IRS is welcome to audit you, but you then present your checks and deposits as proof that they were not redeemed in contract binding Federal Reserve Notes.

    Essentially it is similar to using a credit card where you get $500 from the credit card company to pay for a shopping bill. You then are under contract to pay the credit card company back the amount plus interest plus any fees. You are required to do this because you used their money. They however cannot charge you interest nor fees based on money that say you get for your birthday because they did not issue that money to you.

    This is perfectly constitional because like any contract you are bound to the rules of the IRS by using money when in the form of Federal Reserve Notes. And thus you ARE required by law to pay income tax (their interest/fee) when using their money.

    Is this all correct?

    • David

      Also the USC Title 12 411 is the front end that allows you to convert the instrument from a Federal Reserve Note to a United States Note. But what is the law for the back end that states that Income Tax is based off how much Federal Reserve Notes you acquire. That is one that ties it all together.

      • Tom

        Income tax is a “direct tax” that is “unapportioned” and is unconstitutional, which is why you are required to bond your substance against the “loan” or the “borrowing” of the Fed notes. The Fed money cannot be created without your signature. This is how the banks fractionally lend.

        • BigIron

          “The sweat of a man’s brow shall not be taxed”. – ???

          Anyone know the source of that statement?

        • Thomas G

          I’m sorry, but that is definitely not true. The income tax is an INDIRECT tax, an excise tax, which needs no apportionment. Please see Brushaber v. Union Pacific Railroad Company, 36 S.Ct. 236, Jan. 24, 1916. Also Treasury Decision 2303, which is based on Brushaber. The income tax is definitely constitutional. The 16th Amendment only served to confirm that Congress’s original taxing power, when applied to income, must be an excise. An excise is a piece-of-the-action tax based on federally-connected privilege, in turn requiring a nexus to the federal government which may be avoided by choice.

          Also, the tax code, comprising Title 26, has never itself been passed into law by Congress, because it is based on the various Statutes at Large which HAVE been passed by Congress. The tax code thus becomes prima facie evidence of the law, but of itself, is not the law. Therefore its wording is instructive, but not conclusively exhaustive.

          Has anyone successfully convinced IRS that private money-cum-lawful money does not therefore comprise taxable income? If so, I’d certainly like to hear about it…..

          • Tom

            Someone always wants to bring up Brushaber, not the case to hang your hat on for the the indirect tax argument.

            Tell me then, if it’s constitutional, why is it voluntary?

    • Tom

      Hi David,

      You are correct. However, I prefer the verbiage “Redeemed in lawful money pursuant to…” specifically because Title 12 is explicit about “demand for lawful money”. The credit card analogy is a good one. “Legal Tender” does not “buy”, it “discharges” debt. Lawful money has the power to “buy”, to “own” without lien.

  • James

    Where is the tax exempt code and how does one fill out the 1040 form to keep the banks from cheating?

  • Joseph

    Specific question here: I want to start signing my checks with the specific endorsement to use lawful money. My question is, the last line where I put in my name First Middle dba FIRST LAST…should any of that be in cursive, like my normal signature? Or is it all printed? If it is printed, do I need to put a cursive signature below that? I want to make sure I do this endorsement correctly..

    • Tom

      Printed true name, legal signature.

      Thanks for the comment!

      • Joseph

        So if a person’s name was John Bob Doe the endorsement would be :

        John Bob dba John Doe(in the normal cursive style signature form?)


        Sorry, I want to be absolutely sure I do it right. I tried asking USAA and they kept ducking the question. They recognized my right to use lawful money but wouldn’t answer my question about whether the endorsement was correct.


        • Tom

          Correct. Your legal signature should be your LEGAL NAME “signed” as you have been signing your whole life.

          • Joseph

            Awesome, thank you very much! Lets see how this goes…What do you recommend doing if they reject the deposit?

  • musivick

    if there is only $300 million in legal money out there circulating
    how can 50% of the workforce payroll checks get cashed into ‘legal’ money, by the special endorsement you talk about?

    $300 million is all that can exist at any one time, everything else will remain FRNs

    ‘splain it to me again

    • Tom

      Correct. How the banks do their accounting is not your concern. You have you demand recorded on the back of your check. That’s your proof that that what you have in your hand is lawful money. That’s why you must always keep copies of the front and back of the checks you deposit with your demand. You’ll notice right on the face of the fed notes there are 2 signatures. One from the treasury, and one from the Fed. It has been codified that Fed notes can act as “lawful money”, and that’s how.

      Also note that “acting as” Lawful Money means that they are not actually “lawful money” :-)

      Hope that helps.

    • BigIron

      If one goes to the US Treasury web site and “googles” for: ” us treasury 1971 can serve both function ” one finds:

      Legal Tender Status

      *** I thought that United States currency was legal tender for all debts. Some businesses or governmental agencies say that they will only accept checks, money orders or credit cards as payment, and others will only accept currency notes in denominations of $20 or smaller. Isn’t this illegal?

      The pertinent portion of law that applies to your question is the Coinage Act of 1965, specifically Section 31 U.S.C. 5103, entitled “Legal tender,” which states: “United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues.”

      This statute means that all United States money as identified above are a valid and legal offer of payment for debts when tendered to a creditor. There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services. Private businesses are free to develop their own policies on whether or not to accept cash unless there is a State law which says otherwise. For example, a bus line may prohibit payment of fares in pennies or dollar bills. In addition, movie theaters, convenience stores and gas stations may refuse to accept large denomination currency (usually notes above $20) as a matter of policy.

      *** What are Federal Reserve notes and how are they different from United States notes?

      Federal Reserve notes are legal tender currency notes. The twelve Federal Reserve Banks issue them into circulation pursuant to the Federal Reserve Act of 1913. A commercial bank belonging to the Federal Reserve System can obtain Federal Reserve notes from the Federal Reserve Bank in its district whenever it wishes. It must pay for them in full, dollar for dollar, by drawing down its account with its district Federal Reserve Bank.

      Federal Reserve Banks obtain the notes from our Bureau of Engraving and Printing (BEP). It pays the BEP for the cost of producing the notes, which then become liabilities of the Federal Reserve Banks, and obligations of the United States Government.

      Congress has specified that a Federal Reserve Bank must hold collateral equal in value to the Federal Reserve notes that the Bank receives. This collateral is chiefly gold certificates and United States securities. This provides backing for the note issue. The idea was that if the Congress dissolved the Federal Reserve System, the United States would take over the notes (liabilities). This would meet the requirements of Section 411, but the government would also take over the assets, which would be of equal value. Federal Reserve notes represent a first lien on all the assets of the Federal Reserve Banks, and on the collateral specifically held against them.

      Federal Reserve notes are not redeemable in gold, silver or any other commodity, and receive no backing by anything This has been the case since 1933. The notes have no value for themselves, but for what they will buy. In another sense, because they are legal tender, Federal Reserve notes are “backed” by all the goods and services in the economy.

      *** What are United States Notes and how are they different from Federal Reserve notes?

      United States Notes (characterized by a red seal and serial number) were the first national currency, authorized by the Legal Tender Act of 1862 and began circulating during the Civil War. The Treasury Department issued these notes directly into circulation, and they are obligations of the United States Government. The issuance of United States Notes is subject to limitations established by Congress. It established a statutory limitation of $300 million on the amount of United States Notes authorized to be outstanding and in circulation. While this was a significant figure in Civil War days, it is now a very small fraction of the total currency in circulation in the United States.

      Both United States Notes and Federal Reserve Notes are parts of our national currency and both are legal tender. They circulate as money in the same way. However, the issuing authority for them comes from different statutes. United States Notes were redeemable in gold until 1933, when the United States abandoned the gold standard. Since then, both currencies have served essentially the same purpose, and have had the same value. Because United States Notes serve no function that is not already adequately served by Federal Reserve Notes, their issuance was discontinued, and none have been placed in to circulation since January 21, 1971.

      The Federal Reserve Act of 1913 authorized the production and circulation of Federal Reserve notes. Although the Bureau of Engraving and Printing (BEP) prints these notes, they move into circulation through the Federal Reserve System. They are obligations of both the Federal Reserve System and the United States Government. On Federal Reserve notes, the seals and serial numbers appear in green.
      United States notes serve no function that is not already adequately served by Federal Reserve notes. As a result, the Treasury Department stopped issuing United States notes, and none have been placed into circulation since January 21, 1971.


      There appears to be a problem with the logic of the Treasury:
      12USC411 specifies that debt (FRNs) must be exchanged for value (what that is specifically is no longer specified but it is still required to have value)
      Banks CANNOT use lawful money for their “fractional reserve”.
      FRNs are either NOT lawful money … OR serve both functions.
      If an FRN IS serving the function of “lawful money” how can a bank know that it cannot be used for “fractional reserve”? It does not look different does it?
      If the bank uses it AS “fractional reserve” knowingly or unknowingly they have committed both fraud and counterfeiting of a negotiable instrument, an FRN.
      If I receive a FRN that is “lawful money” how will I know that it is “lawful money” and so have no tax obligation? … and can use it to exchange for goods that I will “lawfully own”.
      If this discrimination CANNOT be done then it CANNOT be logically said that the FRN can adequately serve both functions and it would appear that the US Treasury has been and still is complicit in both fraud and counterfeiting by no longer printing the United States Notes (USNs) to be exchanged as per 12USC411.

      It is also worth noting that any bank that refused to honor 12USC411 falls under 12 USC501a (NOTE: both 411 and 501a are Chapter 3). 12USC501a describes what happen to a bank if a bank should refuse to honor 12USC411 … and it isn’t pretty.

  • Mike

    If the law only allows $300,000,000 in currency, that’s less than a dollar for every man, woman, and child in this country. If everyone turned in all their FRN’s for USN’s this would not only hurt the Fed but also the entire economy. For this to work, 31 USC §5115 would have to be amended to increase that number. If not, the gap between the haves and the have-nots would grow and the country would be in shambles.

    I understand that hard currency (coins) and bullion add to that number. I also understand that endorsing checks as proposed converts your income into non-taxable, real money. But isn’t doing that the same thing that the Fed is doing already? Creating money out of thin air? Instead of creating more FRN’s, it creates more real money. But considering the creation of money is an act that can only be done by Congress, doesn’t this make the convertibility of FRNs to USNs unconstitutional?
    There are more FRNs than there are USNs in existence. Therefore it would be impossible for all FRNs to convert.

    • Tom

      Hi Mike,

      You’ll notice right on the face of the fed notes there are 2 signatures. One from the treasury, and one from the Fed. It has been codified that Fed notes can act as “lawful money”, and that’s how.

      What your missing is that every time a dollar is redeemed from the credit system, that dollar HAS to be removed from the national debt. Please re-read the article above for clarity :-)

      • BigIron

        I believe that this statement by the
        US Treasury is “false”! “… United States notes serve no function that is not already adequately served by Federal Reserve notes. As a result, the Treasury Department stopped issuing United States notes, and none have been placed into circulation since January 21, 1971.”

        So it appears there is a problem with the ACCOUNTING RECORDS (?probably deliberate contrived?/ ?Fed & UST?) that precludes the proper complete conversion to “lawful money” which would actually decrease the number of FRNs in circulation and, therefore, the national debt. Yes, the converted FRNs should be removed from circulation but the 1971 policy pretty much assures that they will not be removed even if we have complied in every way possible today to redeem our FRNs in “lawful money”!

        There appears to be a problem with the logic of the Treasury:
        12USC411 specifies that debt (FRNs) must be exchanged for value (what that is specifically is no longer specified but it is still required to have value)
        Banks CANNOT use lawful money for their “fractional reserve”.
        FRNs are either NOT “lawful money” … OR serve both functions.
        If an FRN IS serving the function of “lawful money” how can a bank know that it cannot be used for “fractional reserve”? It does not look different does it?
        If the bank uses it AS “fractional reserve” knowingly or unknowingly they have committed both fraud and counterfeiting of a negotiable instrument, an FRN.
        If I receive a FRN that is “lawful money” how will I know that it is “lawful money” and so have no tax obligation? … and can use it to exchange for goods that I will “lawfully own”.
        If this discrimination CANNOT be done then it CANNOT be logically said that the FRN can adequately serve both functions and it would appear that the US Treasury has been and still is complicit in both fraud and counterfeiting by no longer printing the United States Notes (USNs) to be exchanged as per 12USC411.

        We get what we want for ourselves (in the avoidance of taxes and real ownership of our property) but our Country does not get the “benefit” that it “rightfully” should receive from our actions. Sneaky isn’t it!!!!

        • BigIron

          So maybe they let us win without too many impediments because we are too few to really matter in the their grand scheme of things and it really does not affect their ability to steal the wealth of our Nation. Letting us win a few would only really matter if what we did actually did effect the removal of the FRNs from circulation and the resultant reduction of the national debt.

  • brian

    Stumbled across your site last nite. I can\’t seem to access, or find for that matter, the video that I couldn\’t get to last nite. Location? thanx so much, I appreciated your succinct \’put-together of the info herein. More fuel to the fire.

  • George

    My bank is trying to tell me that the only thing they can allow on my signature card is my legal name found on my ID card because of the Patriot Act. Trying to tell me that I can’t add anything to it. My other bank is trying to tell me that legal tender is the same thing as lawful money. They also said they are in compliance, and will not be changing my signature card because they know that the way they do it complies with the law. I’ve provided both banks with a copy of the law. 12USC411. What else can I do? The credit union threatened to close my account.

  • Horace

    Good article, but you never really specifically explained how to go about redeeming the public money for the private. I mean you mentioned it, but it is not real clear as to how to do it step by step. You say that we can do it,but you so not say how.

    • David Merrill

      That function is something that the bank must do. But I do not advocate that you start working like you are the OCC. Just pay attention that your demand is made and you will probably get all your withholdings refunded.

  • Matthew

    Hi Tom,
    I’m in the U.K. and would like to know if similar law exists for us. I have tried a bit of research but I’m just getting a lot of status quo. Can you suggest any websites, forums, names or search terms to oil the wheels.

    many thanks

  • Lee

    As a new SPC, i would like to find out more about “PMSI” (Purchase Money Security Interest) and what are the advantages of it. If anybody has any experience or knowledge with this it will certainly be appreciated.

  • This add up to my knowledge about whats going out there in our green money.

  • You should be able to select your individual standard bank. I’d use a person that is close to wherever I live. Near by will make it effortless in your case to have on the traditional bank to try and do any of your banking home business. I also like local banks as opposed into the national banks. When I can I like calling the commercial lender the following and not in some far off city. I need to point out that additional often than not you could unearth the smaller banks in a tiny town as opposed to inside city.

  • George Rymer

    When I cash in my IRA the company will issue a check. When cashing the check I simply use the verbage mentioned and receive lawful money and it is not taxed. Is this correct?

    • Tom

      Simple simple. The tax is because you have entered into a private contract with a private company. If you use the money of the United States you are not obligated to that agreement.

    • Michael M

      How to get lawful money out of your IRA?

      First open a precious metal IRA from someone like Gold Star Trust. Transfer your money out of your first IRA into your PM IRA. Once the money is transfered over the Trust will contact your PM broker. Instruct the broker to only purchase American Gold and Silver Eagle coins which are gold and silver coins produced by the US Mint. Once the gold is shipped and the Depository Trust people receive your shipment simply contact the IRA Trust and request “distribution in kind”. The trust company will ship you the US gold and silver coins (lawful money) without converting back into FRNs.

      Problem solved. I know it works because I did it and have been very happy that I did.

  • Soe Trust

    MUST SEE VIDEOS! Watch all three in their entirety. Make a night of it. Might want to watch more than once.

    Dawn of a Golden Age

    The American Federal Empire

    The Farmers Claim

  • Lori

    Same as Horace. I need to know how to redeem private money for public money. At present, I do not get paychecks. does it have to be a paycheck? Would a personal check work just as well for the conversion?

    • Tom

      ANY check.

      • David Merrill

        That is right. Any check is a paycheck.

  • Jay

    Ok so all of this makes sense. The only question I have then is do I have zero FED INCOME TAX taken out of my check & have it all put on my check, file at the end of the year with all my copied checks and be left alone? Or do I still have FED INCOME TAX withheld from my check & then attempt to get all of that money back at the end of the year by also filing with my copied checks? Secondary question being if i take the first option how do I go about my job not withholding the FED TAX? Do I send in a W4 with exempt on it or how do I go about that?

  • scott54

    Wow. Can all this really be true. For years my father talked about this and how it came about when he was a child and that his father hated what the government had done to the people and I thought he was crazy. I am going to tell all I know of this and do what I can to help this along and pay it forward. Thanks again and will be starting this with my next paycheck !!!

  • Tim

    I am retired military and receive my pay via direct deposit. This was set up directly through the online MyPay site for military retirees and my signature card is apparently electronic by way of verifying my account information during the setup process. In other words, I never signed a card with my bank. Is there any way to correct this so that my deposits are in United States Notes?

    Additionally, when I go to withdraw my money, do I need to specify that I am withdrawing in US Notes? …or does a signature card cover me for the entire year if audited by the IRS? Would I only be required to show them or refer them to a copy of the signature card indicating that all of my bank withdrawals were US Notes?

    Conversely, how would this affect debit transactions? Would they also be considered US Note transactions based on the signature card?

    All military members were forced on to direct deposit. We were told that if we did not have direct deposit set up by a certain date, we would not get paid. When I retired, I was informed that I must be on direct deposit to receive my monthly check. Is this not compulsory and illegal forcing of persons into the private credit system?

    I suppose I could close my bank account and try and force them to pay me by check, but it is my only income and I depend on it to pay the rent at the first of every month. If there were a glitch or a delay in the government sending me my check, I could end up homeless or paying hefty late fees to my landlord.

    I know what a nightmare the military pay system can be, and if I challenge it, I could go months with no money until everything is sorted out. Any suggestions?

    Anxiously awaiting your response and thanks for the great info thus far.

  • Fred

    If the logic presented here is true, it would seem to go against the fact that the IRS claims that all barter transactions are also subject to income tax, and, for example, barter networks are required to submit 1099-B forms. Such transactions use no FRNs whatsoever but still are subject to reporting and “tax.” How does this fit in?

  • Mara Grace

    Care to comment on this person’s analysis, “[First, unless the “demands” have been made improperly and/or the Treasury Department has not been properly identified, it seems clear that current “FEDERAL RESERVE NOTES” (that’s the text on modern currency) are no longer “redeemable” in “lawful money”. Does this mean: 1) that the law codified at 12 USC 411 is being routinely violated; or 2) whatever currency is currently found in our wallets is no longer true Section 411-“federal reserve notes”;

    Second, note that the right to demand redemption in lawful money only applies to 411-frn’s. If 12 USC 415 (infra) actually designates a second kind of currency called “Federal Reserve notes” (415-FRn’s) then there may be no right of redemption for 415-FRn’s. This could explain why, despite the law at 12 USC 411, you can’t redeem your current 415-FRn’s at the Federal Reserve banks and/or Treasury. But if that’s true, then there’s two kinds of “FEDERAL RESERVE NOTES”—one redeemable in “lawful money” and one irredeemable.]”

  • Winn

    Article quote:
    “Federal Reserve notes are not money and cannot be tendered when money is demanded: 105 So. 305 (1925).”

    The county tax collector signed a statement for me that the property tax MUST be paid with “cash, check or c card.”

    So, I demanded a proof of claim as to what these are or are not. Right. No response. In my demand, I noted I was willing to use whatever is lawful.

    According to the quote above, how do I prove that FRN’s cannot be demanded for the tax? AND there is no money?

  • Winn


    A few days I posted the above. It appeared 3 times.
    Then today it had disappeared… so I posted again.

    NOW there are several entries.

    Can the moderator fix this?

  • Thomas G

    While this stuff may be technically correct, I remain doubtful that the act of endorsing one’s paycheck into “lawful money” will shield me from having my pay or salary subject to the income tax.

    As you say, the Sixteenth Amendment decrees that the federal income tax attaches only to earnings that have some nexus to the federal government. Here’s an analogy about it, as I understand it:

    If you open a lemonade stand on a corner of land owned or controlled by the feds, the profits you make can be taxed by the feds, because, as your landlords, they are entitled to a piece of your action. But if you open the same lemonade stand on private property directly across the street, the feds have no claim on your profits, regardless of how much you might take in.

    “The income tax is, therefore, not a tax on income as such. It is an excise tax with respect to certain activities and privileges which is measured by reference to the income which they produce. The income is not the subject of the tax: it is the basis for determining the amount of tax.” (F. Morse Hubbard, Treasury Department legislative draftsman, House Congressional Record, March 27th 1943, page 2580)

    An excise tax can be avoided by individuals or enterprises simply by not becoming involved “in the conduct of the affairs of a trade or business.”–which is the definition (at 26 USC 7701(26) of the legal term TRADE OR BUSINESS.

    • Tom

      Thanks for the thoughtful comment.

      What you are missing is the contract agreement between you and the fed when you signed the lease for the land for the lemonade stand. Because they own the land, and you want to use it, you have to come to an agreement. That agreement is then signed by both parties.

      If you signed an agreement that says the feds get a piece of your action, then they do! It was still completely up to you…

      Obviously what’s required is a thorough knowledge of the agreement beforehand. If you sign the agreement without reading it, you are still subject all of it’s terms and conditions. Are you a grown man, responsible for your decisions and signature or not? Are you competent to comprehend what’s at stake when you place you signature to an agreement?

      If you are, or are not makes no difference to the creditor. You took the responsibility by entering the agreement as though you were competent.

      Just because you have always believed something to be so does not mean that it is. That’s how mass control works. Various systems of control acting upon you without your knowledge is the what perpetuates them.

  • There always seems to be somebody or other who has suddenly discovered a law or some process that offers a glimmer of hope of getting out from under the income tax.

    This is moonbeam theory about lawful money being non-taxable while private money (FRN’s) is taxable because private money incurs a share of interest based on the use of indebtedness, etc. The simple way out consists of endorsing your checks with language that–presto change-o– turns private money into lawful money, which is then nontaxable because you can show the IRS that your earnings consist of lawful money, even though the feds have said that there is no lawful difference between FRN’s and Treasury Notes.

    Sounds to me like an exercise in utter futility. You guys are expecting that a rogue outfit like the IRS will admit, yazzuh yazzuh, you’ve got it right. No taxes for you because you’re able to show your earnings are in lawful money.

    Good luck on that….

    Fact remains, folks, that when the “employer” you work for reports your “wages” to IRS, it does so under documented oath that avers that it is a “trade or business.” You get to challenge or rebut that report, but the act of doing so is what often buries your hide in a “frivolous” muck of penalties, interest, and liens on paychecks and property.

    That’s because the entire tax code is built with”words of art” whose definitions–never publicized by the government–govern the taxation of your earnings. Words of art appear to be ordinary words with ordinary meanings, but they’re not. Their means are defined in the law and must be used. IRS does pay attention to them, but cares not a whit if you do not. For the most part, you unknowingly volunteer yourself into the tax system.

    • Tom

      Hi Thomas,

      I get what your saying and I feel and share your frustration, but the end of your comment seems to contradict the beginning of it. Words of art. Yes. Exactly. It’s that simple. Yes, the IRS certainly does pay attention to it. Why would they do that if it didn’t matter?

      Just because the population has been dumbed down to the point that they can’t even understand the basic law of contracts, doesn’t mean we live in a totalitarian state. It may seem that way sometimes, but I suspect that’s a lot like the mouse must feel in the maze. If he can never find his way out, it doesn’t mean that the maze keeper is “keeping” him there.

      If he had the facilities, he could get out, and may if he keeps trying. How long it takes depends on the size and depth of the maze. But Thomas, there is only one way out of the maze, and there is only one way to find it. You have to remember where you’ve been, and you have to keep trying to find new paths.

      It’s easy to scoff at people trying to find new paths. Not so easy to be those people. “The pioneers take the arrows”… as they say.

  • Thomas G

    I\\\’m sorry, but that is definitely not true. The income tax is an INDIRECT tax, an excise tax, which needs no apportionment. Please see Brushaber v. Union Pacific Railroad Company, 36 S.Ct. 236, Jan. 24, 1916. Also Treasury Decision 2303, which is based on Brushaber. The income tax is definitely constitutional. The 16th Amendment only served to confirm that Congress\\\’s original taxing power, when applied to income, must be an excise. An excise is a piece-of-the-action tax based on federally-connected privilege, in turn requiring a nexus to the federal government which may be avoided by choice.

    Also, the tax code, comprising Title 26, has never itself been passed into law by Congress, because it is based on the various Statutes at Large which HAVE been passed by Congress. The tax code thus becomes prima facie evidence of the law, but of itself, is not the law. Therefore its wording is instructive, but not conclusively exhaustive.

    Has anyone successfully convinced IRS that private money-cum-lawful money does not therefore comprise taxable income? If so, I\\\’d certainly like to hear about it…..

    • Tom

      By your comments I’m not sure if that’s true. You seem more antagonistic than anything else. I’ve shown where this is law, I’ve explained the evolution of this process. The article above clearly shows the rational behind it.

      Your understanding of the income tax is incorrect on it’s face. My suggestion would be to do your own study and your own reading rather than regurgitate what is posted on popular “patriot” forums and decide for yourself.

      I’ve provided links to places where there are people currently doing this with success. Had you cared to follow them and engage in your own discussion like a true free man you would have seen that.

      The current system of control is allowed to rule simply because people are intellectually lazy and no longer consider themselves responsible for their own affairs.

  • Jessica Ianuzi

    Do all the same remedies also apply to business accounts? I assume it would be easier to revise a signature card for a business account being as though Govt. issued i.d is not required to open such an account.
    Also, it the remedial signature necessary when signing receipts of any and all kind?
    Unfortunately, I just stumbled upon this topic last week. I assume I wont be able to apply what I’ve learned to my 2012 taxes being as though we are already a few months into the tax year.
    Thank you all for the information

    • Tom

      If you are doing business it should be applied to everything you sign as CSVT for your company.

  • jones

    I don’t think this exempts you from income tax at all. Unless you are self employed, maybe. For us working slobs, we work for a corporation, governed by the tax code. When we get hired we agree to become a representative of that corporation and subject ourselves to it and all the liabilities that come with it.

    However, the main point I took from this was to dismantle the FED system and put them out of business. That’s a good enough reason for me. Demanding lawful money that changes the balance sheet of the national debt and moves real money out of the pocket of the bankers is a worthy cause. All other aspects remain the same. You will have to pay your taxes because you were paid in FRN’s by a corporation which you then are redeeming in lawful money at the bank.

    Sound about right?

  • Rog

    Help me out here, irrecusable obligation is “a term used to indicate a certain class of contractual obligations recognized by the law which are imposed upon a person without his consent and without regard to any act of his own”. How is it that such a thing exists? Contract law is pretty clear on this. If I do not agree to the terms or the terms of said contract are not fully disclosed there is no contract. How is it a contract can imposed on me without my consent?

    Second, government in cahoots with the Fed have made it extremely difficult if not impossible to conduct business using public money. Try convincing your customers that the money they are using is a private currency and not lawful money. Sure, if you work for someone you may be able to do this little dance at the bank but will the grocery store accept a stack of coins or bills (if you can get them) that may be lawful money but look different than a federal reserve note.

    The point here is that, yes, this is all law but, even someone like me who has been looking into this for a long time and to whom this twist is new, the practical application in the real world (sic) is simply more than can be expected of your average Joe in a country where very few have clue about lawful money or even a passing understanding of law. In other words the government has stacked the deck to such an extent that trying to function financially apart from the Federal Reserve is such a headache-think of all the transactions and financial associations one engages in in a normal day-that to expect a
    majority to do as you’re suggesting is nigh impossible. There must be a better way.

    • Tom

      A “better way”? What could be simpler than this? Is this too hard for you? And you understanding of “contract law” is incorrect. Ignorance of the law is no excuse. Ever heard of that?

      Maybe you’ve never heard of people signing a credit card agreement without understanding that if they are late their interest rate goes to 30%. They didn’t take responsibility for their own agreement. Ignorance is no excuse.

      We got into this mess because we turned over our lives to a government (any government) that seeks total control over us. It is not going to be undone with something comes in a box like an easy-bake oven.

      People that desire to be free men will have to educate themselves, take responsibility, stand up for themselves the way a sovereign would. If you act like a sheep, demand to be fed like a sheep, then you will be owned like a sheep.

      You want something with no risk and total security. You think you have that now? You think tyrants give up their power easily?

  • What is the penalty for a bank violating 12 usc 411 ?

    What is a step by step process for securing enforcement of 12 usc 411?

  • YoOle Me

    WHAT – if any – \"Fix\" have you established for annotating the signature card, in the bank that uses an 1.5 x 2.5 inch electronic signature pad, with stylus, that virtually eliminates anything but signature – and even that, in smaller that normal format!!!

  • Who cares?

    Render unto Caesar what belongs to Caesar, render unto God what belongs to God.

    If your using Caesar’s money, (green paper with an image of a dead president/Caesar) then you owe him a duty/tax for using his private property for your benefit.

    The so-called income tax is merely a user fee for your use of Caesar’s private property. i.e. money is movable property

    The Lord gave us a remedy and Man has NOT dishonored that remedy by giving you HJR-192 and 12USC411 as a way to not force you to use Caesars property/money for your profit/gain.

    • The Temple priests, testing our Redeemer Kinsman, asked Him: “Is it lawful to give tribute to Caesar, or not? But He, knowing their hypocrisy, said unto them, Why tempt ye me? Bring me a penny (denarius) that I may see it. And they brought it. And He said unto them, “Whose is this image and inscription?” And they said unto Him, Caesar’s. And The Messiah, answering, said unto them, “Render unto Caesar the things that are Caesar’s and unto God the things that are God’s.” (Mark 12:14-17).

      Looking at this coin, on one side, the inscription ends with “CAESAR DIVI” and the other side says “PONTIF MAXIM”. The first means “Caesar is god” and the second means that Caesar holds the highest religious office on earth, the title later adopted by the Roman Popes.

      The account of the Tribute to Caesar is more extensively covered in Matthew, chapter 22. In the Matthew account, we clearly see that as soon as the Herodians understood the answer that they received, they marveled at the answer, and went on their way. After that time, they ceased to question Him any more.

      At first glance, the question appears to be one of the few really stupid questions in the world, because it is ridiculous to assume that there would be a Roman law that made it illegal to pay Roman taxes. However, when one understands that both the question and the answer were given by Jews, and were given under Mosaic law, not Roman law, then one understands that the Herodians were being told that by paying tribute unto Caesar, they were violating the first through the fourth commandments. We can see that The Master was clearly saying, “Do not pay taxes unto Caesar”, as was alleged at His trial. The Herodians quit questioning him any more at this time, because they could not use his words to Herod, and have Him killed. They knew that Herod would not understand the Mosaic legal implications of what He said.

      Can you find any other plausible explanation for asking for the inscription, given that both the question and answer are clearly references to Torah? See also: First Samuel 8:7-19; Revelation 18:3-4

      • David Merrill

        I point out an intentional pronoun – “They”.

        Congress and attorneys know better than to use a pronoun when they could be specific, using “Federal Reserve notes” from two sentences prior.

        They are people making the demand.

        This fits the same redemption model of Jesus CHRIST.

        It is good to see you well Michael Edward!


        David Merrill.

  • I believe A POLITICAL RESPONSE is just as important IF NOT MORE IMPORTANT then a lawful/legal response.

    To this end I’ve created AmericansRestoringAmerica a DOT COM within which are 30 some sub-set websites to which ConstitutionalCurrency another DOT COM provides that vehicle that Enable and Empower The American People to address your particular passion.

    There is no cost to use ARA or CC or any of the other web sites therein with the exception to YourRemedyIsInTheLaw which is another DOT COM.

    I hope those interested in restoring The Rule of Law over the rule of men will join me and others to provide the political response.

    Yours in Freedom,
    Michael Edward

  • David Merrill

    I got an email yesterday from a fellow who got a threatening letter a couple years ago:

    “I’ve already received the same style letter awhile back including an apology for any inconvenience caused.

    This process I executed was in response to an assessment letter for not filing and the IRS sent a letter with a bill based on information from K-1 forms and other sources. I believe it was over $9000 that they were seeking. That was back in Sept-Oct 2011. I R4Cd their assessment and sent my evidence of non-endorsement/non-contract with the FED – photocopies of checks front and back with my demand for lawful money from beginning, middle and end of year for the year the IRS was inquiring/assessing about. The entire process was also sent to my evidence repository in the U.S. District Court with a copy of that clerk instruction sent to the IRS.

    Haven’t heard a peep since that apology letter.

    This PROPER MANNER AND METHOD taught to me by David Merrill has produced results and success. Prior to this knowledge and David’s teaching, I only had an inkling that something was not right via my participation in the income tax system. Remedy between the ears happens first but that must be followed by ACTION in the PROPER MANNER AND METHOD so as to bring the remedy between your ears to fruition.”

  • David Merrill

    I point out an intentional pronoun – \"They\".

    Congress and attorneys know better than to use a pronoun when they could be specific, using \"Federal Reserve notes\" from two sentences prior.

    They are people making the demand.

    This fits the same redemption model of Jesus CHRIST.

    It is good to see you well Michael Edward!


    David Merrill.

  • Hello BigIron,

    Great speech, as I, beleive in what you had addressed herein too.

    We also need to learn about laws that pertain to us. As you\\\\\\\’ll learn a lot by reviewing the laws too. Since they also follow them. Look under laws pertaining to fraud. I have learned a lot from them, and as looking at case laws also. And reading the Federalist Papers, and the Constituton.

  • David Merrill

    That is right. Any check is a paycheck.

  • It is very amusing how this information comes around and goes around.

    Noted as of 1/9/14.

  • I acquired a castle on 9/11/01 and since then the artist has been notifying redemption:



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