Accountant Fights IRS and Wins

http://news.yahoo.com/s/ap/20080824/ap_on_bi_ge/tax_fight_irs_loses

RUGABER, AP Business Writer

It took seven years, but Charles Ulrich did something many people dream about, but few succeed at: He beat the IRS in a tax dispute.

Not only that, but tax experts say potentially millions of other taxpayers could benefit from his victory.

The accountant from Baxter, Minn., challenged the method the IRS has used for more than 20 years to tax shares and cash distributed by mutual life insurance firms to their policyholders when they reorganize as public companies.

A federal court recently agreed with his interpretation.

"There's a tremendous amount of money at stake," said Robert Willens, a New York City-based tax analyst at Robert Willens LLC. "Tens of thousands of people could be in line for a refund."

Don Alexander, an IRS commissioner in the 1970s and now a tax attorney in Washington, said while it's not unusual for individuals to take on the agency, "most of them lose."

Alexander called it "quite a significant case."

The dispute arose when more than 30 mutual life insurance companies became publicly traded corporations in the late 1990s and earlier this decade, in a process known as "demutualization."

Mutual companies are owned by their policyholders, so the companies provided stock and cash to compensate them for the loss of their ownership interests when they went public.

All told, roughly 30 million policyholders received distributions, Ulrich estimates. MetLife Inc. provided over $7 billion of stock to about 11 million policyholders when it went public in 2000, while Prudential distributed $12.5 billion in stock to another 11 million.

The IRS held that the recipients hadn't paid anything for the shares and owed taxes on the full amount when the shares were sold. Cash distributions also were fully taxable, the IRS said.

That didn't sound right to Ulrich, 72, an accountant for 49 years. He began researching the issue in 2001, when he received shares from two companies, Prudential and Indianapolis Life.

Ulrich concluded that policyholders had paid for their ownership rights through their premiums so the distributions should have been tax-free.

That could make a significant difference in what a taxpayer owes. If a company distributed shares worth $30 and a recipient subsequently sold them at $32, under the IRS' view they would pay taxes on all $32. Under Ulrich's interpretation, they would owe taxes only on the $2 per share gain.

In 2003, Ulrich publicized his views by contacting tax and insurance experts and setting up a Web site.

"Largely I was regarded as a lunatic," he said, who "would never prevail against the IRS."

Still, some people who'd paid taxes contacted Ulrich and asked him to file refund requests, which he did, for a fee. Some of those refunds were granted, he said. Tax experts say the IRS doesn't always closely scrutinize small refunds.

One of his clients, Jean Prevost and her husband, Jim, who live near Minneapolis, received a refund of almost $1,500 in federal and state taxes in 2003.

"It wasn't a huge amount of money, but it was ours," she said.

But the IRS wasn't pleased with Ulrich, accusing him of promoting abusive tax shelters and demanding the names of his clients, which he said he refused to provide.

The agency backed off in 2004 with help from the IRS's Taxpayer Advocate office, Ulrich said.

IRS spokesman Bruce Friedland said the agency is prohibited from commenting on its interactions with taxpayers.

One of Ulrich's clients, Eugene Fisher, a trustee for a Baltimore, Md.-based trust, sued the IRS in February 2004 after being denied a refund.

Judge Francis Allegra of the Court of Federal Claims in Washington sided with Fisher and called the IRS' view "illogical" in an Aug. 6 decision. He ordered the agency to refund $5,725 in taxes plus interest to the trust overseen by Fisher.

It's not clear how many people could benefit from the ruling. Many of the 30 million policyholders are probably too late to seek refunds, since claims must be filed within three years of the April 15 tax deadline. That means the statute of limitations for taxes paid for 2004 ran out April 15, 2008.

Many individual taxpayers may not have enough at stake to go to the trouble, said Burgess Raby, a Tempe, Ariz.-based attorney who represented Fisher. Still, millions of policyholders could benefit from the court's ruling, he said.

Raby credits Ulrich with being the driving force behind the issue.

"The genesis for this was Chuck's real feeling that this was an unfair position" by the IRS, Raby said.

The government could appeal the ruling and likely will fight future refund claims, perhaps hoping for a different outcome in a separate court, tax experts said.

Charles Miller, a spokesman for the Justice Department, said the government hasn't yet decided whether to appeal.

Still, taxpayers should request refunds if they're eligible, the tax experts said, because even if the IRS rejects the claim, doing so extends the deadline for a potential refund for two more years.

Ulrich will prepare refund requests for interested taxpayers, for a fee, and has posted additional information at his Web site, http://www.demutualization.biz.
But he said the principle is more important to him.

"I think it's important that taxpayers' rights be protected," he said. "We should have had a Boston Tea Party over this."

(This version CORRECTS Website to http://www.demutualization.biz)

USS Liberty crew member-survivor of 1967 attack by Israel speaks

President Johnson gave instructions for covering up any news or investigation of the attack. John McCain's father, Admiral John McCain recalled rescue aircraft dispatched to the attack site. No explanation ever has been given for these traitorous orders and no news was given to the newspapers of these actions. History so far has not touched on these attacks.


Leave No Comrade Behind
August 7, 2008 - crescentandcross

By Phillip F.
Tourney
Leaving no one behind is a time-honored tradition, from the battle fields of Gettysburg, Hamburger Hill, Pearl Harbor, Battle of the Bulge, Wake Island, etc, etc, etc. This is not a tradition of the United States but of all countries that find themselves in wars and conflicts, whether on the ground, in the skies or on the seven seas.

On the battle fields of this once-great nation called the United States they would bury the dead with honor so as not to forget their service in fighting for their country. Whether it was the North or South, in Europe, Asia or wherever Americans have fought and died they have been honored for the ultimate sacrifice for their country.

Many brave men in all wars have risked their own lives so they may save the life of another, and as Jesus Himself said, ..no greater love exists than that a man lay down his life for another... You can..t teach this type of dedication in any school nor can you order anyone to put himself in harm..s way to save another and guarantee that that order is followed.

The type of men who put themselves in harm..s way to save another is in the soul of that person. With no hesitation you react-there is no time for thinking, it just happens and it is a gift that comes from God. In most wars, even the enemy has the dignity to treat and care for the captured or killed, just as they would want there own treated. I am not suggesting this is always the case, as indeed some are tortured or abused in many different manners. Unfortunately this happens in war. When it does happen however, normally the abusers are tried in a court and hung until dead or in prison as they very well should be.

I was in a situation during the six day war between Israel and the Arab states,
Being on a ship called the USS Liberty. What a wonderful name, to be put on a ship which stands for what is so great about America-our freedoms, our respect for one another, the constitution, bill of rights, all meant to protect the citizens of America.

All of that pride for my country and for what it stands all flew out the window at two o..clock in the afternoon on June 8, 1967, a bright sunny day when our beautiful flag with her beautiful stars and stripes were flying in the warm breeze coming over our deck. In just seconds our flag was in tatters, holes in her and shot down. The men on deck where screaming in agony from shrapnel wounds peppering there flesh and leaving huge wounds that bled profusely. I saw the greatness in mankind that day, the greatness of the American fighting men aboard Liberty as other sailors put their lives on the line to save their helpless comrades, braving rockets, canons, amour-piercing fifty-caliber machine gun fire as the Jewish state and its assassins shot at our fire-fighters and stretcher bearers.
I saw men put their lives on the line to retrieve the dead on the exposed weather decks, I saw men fighting fires on the bridge bravely from the napalm
Israel dropped on our ship that engulfed it in flames. Men below the water line bravely stood their ground with five torpedoes on their way to sink our ship, the Liberty. In the communication spaces the men stayed, awaiting certain death in the engine room and the same in the fire room as these brave American sailors would not abandon their general quarters stations and all for the greater good of the crew and our ship.

One of the torpedo..s struck our ship on the starboard side in the communication spaces, resulting in the deaths of twenty five sailors and Marines who were blown to bits. The blast was so powerful it picked our ship up out of the water and dropped her back onto the sea with a thunderous rumble.

The word was passed to abandon ship. All of our life rafts had been destroyed except for three. We put them over the side to put our most seriously wounded in them. Two of rafts were shot out of the water and a third was taken aboard one of the three attacking Israeli torpedo boats, a blatant war crime to say the very least. Troop-carrying helicopters sent to our ship hovered overhead with armed commandoes ready to board us and kill the rest of us. They were so close you could see the hate in their bloodthirsty eyes and to call it frightening is the understatement of the century. They stayed for awhile and left, but we did not find out until much later why the did not board our ship and murder the rest of the crew. To add insult to injury we had been identified by Israel as American and friendly many hours before the attack but they attacked the only ..friend.. they have nevertheless.

When all was said and done the attack lasted about as long as the attack on Pearl Harbor and left behind two thirds of the crew either dead or wounded. Over eight hundred rocket and cannon holes in her skin, napalm burning us up, and a hole in the side of our ship you could fit a house in it. We were listing badly to the starboard side and praying our ship would not roll over on us.

The Liberty crew is one of the most decorated ships in Naval history. Our ship was so heavily damaged it is second to none including if it can be believed during WWII. Only the hand of God kept our good ship Liberty afloat and all the experts say we should have gone down and gone down fast.

Now the most shameful part of American history is not that our ship was attacked by an enemy of the United States but rather by our so called ..ally..- Israel. They used unmarked jet aircraft to attack our virtually unarmed ship to mask the true identity of our attackers. We got a message out to the sixth fleet that we were under attack to the USS Saratoga battle group and the USS America battle group within fifteen minutes of the start of the attack. Rescue aircraft were sent to our aid only to be recalled by John McCain JR. Admiral Commander in Chief United States Naval Forces, it is none other that his own son, Senator John McCain son who is in the Presidential race. Can you imagine the gaul it took to recall rescue air craft when an American ship is under attack by an unknown government? Our ship was in international waters doing what we were ordered to do and had every right to be there.

We had no idea who was attacking us until the torpedo boats came after us, then we could see the boats markings and the Star of David on their flags. We almost fell over in shock, as we thought it was an Arab state doing the murdering, not Israel. Help never did come to our aid, unbelievable as it may sound, until eighteen hours after the attack, disgraceful indeed.

On Sunday Admiral Isaac Kidd came aboard our ship and put the fear of God in all of us, ordering us never to speak of the attack to anyone-family members, friends, not even to God Himself-NO ONE. It was made clear to us that if we broke those orders he would make sure we ended up in prison or worse and worse meant DEAD and thus made us part of the cover up.

At Arlington National Cemetery there is a mass grave with six men buried, only body parts, never to be identified. On the very large head stone there is no mention of who killed these Americans. The only reason for that is to protect Israel and to keep the 41-year old cover-up in place.

Israel gets a pass on cold-blooded murder and our government is their biggest fans. They will not tell the truth about what really happened to the finest ship that ever was commissioned into the United Sates Navy fleet.

Bringing it full-circle, ..Leave no comrade behind.. does not pertain, does not mean a thing when it comes to Israel. Our government left the United States behind. Israel not only attacked our ship and got by with it, ISRAEL ATTACKED YOU, MY FELLOW AMERICANS, AND GOT BY WITH IT.

And as bad as this is, it gets worse my friends, for history will repeat itself if ..we the people.. don..t react to this brutal crime, get the truth out and let America know what Israel did to all of us and continues to do so with the help of our very own government since June 8 1967. No one should get by with cold-blooded murder of America..s sons and the United States of America should not get by with leaving their comrades behind to be slaughtered. This is a crime in itself.

Phillip F Tourney
Survivor USS Liberty
June 8 1967
tonktime5@yahoo.
com