Dave Champion: Forced Into the Taxpayer Box

Alex: Welcome back. Last time, we widened the lens beyond Freedom Law School and profiled two independent voices. Today we are going back to one of them, because Dave Champion just published a new video, and it is the most practical thing he has put out in a while. Thirty-five minutes, posted this week, called "How U.S. Companies Illegally Force Americans Into the Income Tax System."

Jordan: And the title tells you the twist. Champion's argument is usually about the tax code itself. This one is about the paperwork at your job. His claim is that the forcing does not start with the I R S. It starts with employers, banks, and every company that has ever handed you a form and a pen.

Alex: Start with his foundation, because everything else builds on it. Two boxes.

Jordan: Two boxes. Champion says the law itself sorts people into taxpayers and nontaxpayers. That second word, nontaxpayer, is not his invention — he points out it was coined by a federal court in an income tax case. A taxpayer, by the code's own definition, twenty-six U.S.C. section seventy-seven oh one, is any person subject to any internal revenue tax. And Champion says the income tax itself, Subtitle A, was imposed on exactly three classes of people: nonresident aliens with U.S. source income, foreign corporations with U.S. income, and U.S. citizens or residents acting as the agent of a foreign person. Everyone else, in his reading, sits in the nontaxpayer box.

Alex: And the companies' first move, he says, is to pretend there is only one box.

Jordan: Exactly. Nobody at H.R. asks which box you belong in. Nobody at the bank asks. They just shove every American into the taxpayer box, and then they get you to confirm it, in writing, under penalty of perjury.

Alex: Walk through the mechanics, because this is the heart of the video.

Jordan: Three pressure points. First, the W-4. You cannot start the job until you sign it. Champion's line is, they sign it because the alternative is, take a hike. Second, the W-9. A contractor finishes the work, and the company says, we're ready to pay you, but we won't cut a check until we receive your W-9. Third, the tax I.D. number itself. Every financial institution in America, he says, down to the crypto exchanges, now demands a T.I.N. as a condition of opening an account. Refuse at a hundred institutions and you are locked out of the financial sector entirely.

Alex: And his claim about what a signature actually means — this is the part people have not heard before.

Jordan: Champion says every income tax form has a required signer's status baked into it, and not in the instructions on the form — in the statutes, the regulations, and the Treasury decisions behind the form. So when you sign a W-4, he says, you are legally attesting that you are a nonresident alien receiving U.S. source income as wages. When you sign a W-9, you are attesting that the money is not yours, that it belongs to the foreign person you are acting as agent for. In other words, the forms only make sense, in his reading, for the three classes the tax was actually imposed on. Everybody else who signs one is, on paper, declaring a status that is not theirs — and a signed declaration under penalty of perjury creates a legal presumption. Then the company files its W-2s and 1099s, and now the I R S computer holds a presumption that you are a taxpayer. And the I R S, he says, is legally entitled to act on that presumption. That is how a nontaxpayer ends up being chased for a tax he does not owe.

Alex: Okay, that is the mechanism. Now the legal hinge of the whole video: request versus demand.

Jordan: This is the part I would underline. Champion cites section sixty-one oh nine, the T.I.N. statute, and says that in one hundred percent of cases, the law says the party seeking your number may request it. Request. Never demand. Not once, not since nineteen thirteen. And he makes the point with an analogy: imagine a bank demanding your federal firearms license number before it will open a checking account. Absurd on its face. In law, he says, demanding a T.I.N. from a nontaxpayer is exactly the same move — a number that only has meaning for people the tax was imposed on.

Alex: And he hangs a constitutional argument on that distinction.

Jordan: He does, and he roots it in cases this audience knows. Brushaber, nineteen sixteen: taxation on income is in its nature an excise. And he notes the Supreme Court said it again in Moore, in June of twenty twenty-four — the income tax is an indirect excise tax. An excise, a privilege tax, has one defining feature: it is avoidable. You can decline the privilege. But a demand backed by penalties — no W-9, no paycheck; no T.I.N., no bank account; refuse and we'll do backup withholding — is not avoidable. Enforce it that way, Champion argues, and you have turned an excise into a direct tax, which the Constitution only permits on land. That, in his framing, is why the request-versus-demand line is not a technicality. It is the whole ballgame.

Alex: He also does not mince words about the companies' conduct.

Jordan: No. His labels are harsh, and they are his. Holding a contractor's pay hostage to a signature, he calls undue influence, effectively extortion — and he notes the trap: your only remedy is to sue, and suing a client costs you every future job, so almost everyone just signs. And if you tell the company, signing this would be perjury for me, and they keep demanding it anyway — Champion calls that criminal solicitation of perjury, a felony. With the caveat that there is no civil remedy; you would need a district attorney willing to bring charges.

Alex: So what does he tell people to do? The video does offer solutions.

Jordan: Three, mainly. First, correct the record: he says the false presumptions created by those signatures can be legally corrected, that you can stop the I R S in its tracks — but only if you know what the law says and communicate it in the way the agency is required to hear. He takes those cases himself; his contact is dave at drreality dot news, and he says he has answers for the standard lines — we can't do business with you, we can't pay you, we'll have to do backup withholding. Second, litigation: he predicts a single suit against the financial institutions ends the T.I.N. demands, because in his reading the courts have said not a word of income tax law applies to nontaxpayers, so the institutions have no legal defense. And third, self-education — his book, Income Tax: Shattering the Myths, and a companion volume devoted entirely to the W-9, the 1099, and the U.S. person rules, at drreality dot news.

Alex: And his own standing, in his telling: he says he has not filed a return or paid a penny of income tax in thirty-three years. That is his claim about himself, offered as proof the position can be lived, not just argued.

Jordan: Which brings us to the part where we do our job. Everything in this episode is Dave Champion's argument, presented the way he presents it, and we have checked that we are representing his video accurately. But his reading is his reading. The I R S and the federal courts reject these positions, the mainstream of tax law is squarely on the other side, and people have faced penalties and worse over tax disputes. Nothing here is legal or tax advice. What the video is genuinely useful for, whatever you conclude, is the habit this whole series keeps coming back to: the forms have statutes behind them, the statutes have words, and the words can be read. Section seventy-seven oh one. Section sixty-one oh nine. They are public. Read them in full, in context, and decide carefully.

Alex: To recap: Champion's two boxes, taxpayer and nontaxpayer. Companies, he says, ignore the second box, extract signatures that presume the first one, and report that presumption to the I R S — and the law, he says, authorizes a request for your number, never a demand. If you want the man himself, the video is on his YouTube channel, and his profile in our Other Voices section at incometaxdc dot com links to his books and his site.

Jordan: Next time you are handed a form and a pen on your first day somewhere, you may find yourself asking a new question: not just what does this form say — but what does signing it say about me? Thanks for listening. We will see you next time.