To: FRANCHISE TAX BOARD
PROTEST SECTION
MAIL STOP D-12
PO BOX 942867
SACRAMENTO CA 94267-5540

Declarant, Thomas Murrell Thornhill III, is a competent witness and does Solemnly state that:

A. NOTICE IS HEREBY GIVEN that my private policy is that I have no known obligation to correspond with state or federal taxing agencies whose employees/agents fail/refuse to identify themselves. I also have no known obligation to engage in telephonic conversations with unknown persons at unknown locations for their convenience in creating unknown documents which may or may not be to my detriment.
This private policy is based upon my prior personal experience and upon the following policies and statutes:
The Internal Revenue Restructuring & Reform Act of 1998 (P.L. 105-206, July 22, 1998), SEC. 3705 reads (in part, emphasis added):

(a) NOTICE--The Secretary of the Treasury or the Secretary's delegate shall provide that--
(1) any manually generated correspondence received by a taxpayer from the Internal Revenue Service shall include in a prominent manner the name, telephone number, and unique identifying number of an Internal Revenue Service employee the taxpayer may contact with respect to the corresondence;
(2) any other correspondence or notice received by a taxpayer from the Internal Revenue Service shall include in a prominent manner a telephone number that the taxpayer may contact; and
(3) an Internal Revenue Service employee shall give a taxpayer during a telephone or personal contact the employee's name and unique identifing number.

9200 Requests for Information/Documents (IDRs)
...
Discussion with the taxpayer/representative of the applicable laws, regulations, and department policies is essential in order to determine exactly what records will best satisfy the audit verification objectives.
...
The request for specific information and documents, a.k.a. the "Information/Document Request(IDR)" can be made in a free-form format..., or on Form 6203(non PASS)/Form FTB PASS 1515.
All information/document requests should include:
...
The auditor's name, position, address, telephone number and fax number.
...

1.a. It is a fact that on December 27, 2001, I removed from the box I rent from the UNITED STATES POSTAL SERVICE (U.S.P.S.) an envelope (postmarked "DEC. 26'01") from FTB containing a two-page LETTER EC 01-00099713, dated December 21, 2001, (FTB 4744A MEO (REV 11-2000) PAGES 1 and 2) (attached and incorporated herein as Exhibit 1) (hereafter LETTER) purporting to be from "MAKER: 765 :MI :MLF" and "Filing Compliance Bureau", with no name and no signatrue of the purported sender.

1.b. Said LETTER purports to be a NOTICE ("NOTICE DATE: ..."), but does not prominently state anywhere in its face what it purports to be a NOTICE of.
The best guess that I can make from the statement on PAGE 1: "Based on a review of your file, you are subject to the state's filing requirements." is that this might be intended to purport to be some sort of Determination. From the overall tone of the LETTER, it seems to be determining: "Ooo, you're a 'tax protestor'; we don't have to pay attention to you."

1.c. I do not know the time-frame for making a timely response to this LETTER, because I do not know what FTB's purported purpose for this LETTER is.

1.d. It is a fact that I twice have requested in writing (once in my timely-filed REPLY TO FTB, PAGE 4 (hereafter REPLY) and once in my timely-filed Protest) face-to-face hearings concerning this matter.

1.e. It is a fact that, to date, I have not met with anyone from FTB for a face-to-face Audit or Examination Hearing concerning 1999, nor has FTB NOTICED me of such a meeting.

1.f. Revenue and Taxation Code, § 19032 (http://www.leginfo.ca.gov./cgi-bin/displaycode?section=rtc&group=19001-20000&file=19031-19067 [as of January 19, 2002]) reads:

19032. As soon as practicable after the return is filed, the Franchise Tax Board shall examine it and shall determine the correct amount of the tax.

1.h. I reasonably infer that it is factually, and probably legally, impossible for FTB to purport to "review" an Examination which in fact, to date, has not occurred.

1.i. I reasonably infer that FTB's LETTER EC 01-00099713 is erroneous on its face.

2. I was delivered a similar LETTER from FTB for a prior year, so my understanding is that this LETTER is simply a generalized and standardized (boilerplate) LETTER sent to everyone in my situation.

3. It is a fact that FTB's LETTER does not specifically address or specifically refute any of the facts or points I have put forward in my timely-filed REPLY or my timely-filed Protest, its supporting Statement, and supporting Memorandum (mailed to FTB on November 20, 2001, via Certified Mail, Return Receipt Requested) as they relate to my specific situation, so I presume that FTB agrees that the facts in my REPLY and the facts and points constituting my Protest still stand as undisputed and unrefuted.

4. It is a fact that I cannot determine from the face of this LETTER specifically what or which issues, or which of my correspondence, FTB purports to be responding to.

5. I believe that FTB has failed to send this LETTER in a timely manner. My understanding is that FTB probably should have sent this LETTER in the @ 60-day period between the time FTB received my timely-filed REPLY (which FTB denied receiving) and the time that FTB issued its NOTICE OF PROPOSED ASSESSMENT 01-0616603-100901 (hereafter NPA).
From my Statement of Facts In Support of Protest of NPA 01-0616603-100901, item 6.b.:

6.b. I retained the originals of the DEMAND and on July 30, 2001, I returned the REPLY (photocopy of DEMAND and of my retained REPLY copies attached and incorporated herein in full as Exhibit 1) completed to the best of my knowledge, to FTB at: P.O. Box 942840, MS F-200, Sacramento, CA 94240-0040 via USPS Certified Mail # 7001 0360 0001 9241 3630, Return Receipt Requested.

a.1. SBE statement: "It appears that many so-called "tax protestors" have been misled about, or at lehst do not understand, their legal obligations to report their income and pay their personal income tax liability under the California Personal Income Tax Law, as well 'as under the Internal Revenue Code." (Dauberger, p. 119).

a.2. Refutation: It is a fact that the I.R.R.R.A. of 1998 (PL 105-206, July 22, 1998), § 3707, in effect prior to the start of this matter, reads (in part):

(a) PROHIBITION- The officers and employees of the Internal Revenue Service--
(1) shall not designate taxpayers as illegal tax protestors (or any similar designation); and
(2) in the case of any such designation made on or before the date of the enactment of this Act--
(A) shall remove such designation from the individual master file; and
(B) shall disregard any such designation not located in the individual master file.
. . .
(c) EFFECTIVE DATE-- The provisions of this section shall take effect on the date of enactment of this Act, except that the removal of any designation under subsection (a)(2)(A) shall not be required to begin before January 1, 1999.

Federal Conformity: In 1983, AB 36 (Stats. 1983, Ch. 488) made extensive changes in the Personal Income Tax Law, generally repealing many California's "stand alone" statutes and conforming California law by reference to the Internal Revenue Code. ... Where California code sections have been repealed and replaced by references to Internal Revenue Code Sections, taxpayers should look to federal authority for the proper interpretation of those statutes and to California authority construing the statute after the federal incorporation.

§ 19041. (a) Within 60 days after the mailing of each notice of proposed deficiency assessment the taxpayer may file with the Franchise Tax Board a written protest against the proposed deficiency assessment, specifying in the protest the grounds upon which it is based.
(b) Any protest filed with the Franchise Tax Board on or before the last date specified for filing that protest by the Franchise Tax Board in the notice of proposed deficiency assessment (according to Section 19034) shall be treated as timely filed.
(c) The amendments made by the act adding this subdivision shall apply to any notice mailed after December 31, 1999.

b.1. SBE statement: "Section 18401 specifies who must file a return." (Dauberger, p. 122)

b.2. Refutation: It is a fact that West's Ann.Cal.Rev. & Tax. Code (2001), § 18401 actually reads:

§ 18401. Each provision of this part shall apply to Part 10 (commencing with Section 17001) and Part 11 (commencing with Section 23001), unless otherwise provided.

c.1. SBE statement: "In the absence of the filing of a return which provides the information necessary* to determine accurately the individual's tax liability, respondent has the statutory authority under section 18583 of the Revenue and Taxation Code to estimate the liability on the basis of whatever information is available."

c.2. Refutation: It is a fact that West's Ann.Cal.Rev. & Tax. Code (2001), § 18583 actually reads:

§ 18583. Repealed by Stats.1993, c. 877 (S.B. 673) § 20, operative Jan. 1, 1994.

d.1. SBE statement: "Respondent's statutory authority derives from section 19251 of the Revenue and Taxation Code, which states that the Franchise Tax Board shall administer and enforce the California Personal Income Tax Law." (Dauberger, p. 124).

d.2. Refutation: It is a fact that West's Ann.Cal.Rev. & Tax. Code (2001), § 19251 actually reads:

§ 19251. The remedies of the state provided for in this chapter are cumulative, and no action taken by the Franchise Tax Board constitutes an election by the state to pursue any remedy to the exclusion of any other remedy for which provision is made in this part.

e.1. SBE statement: "Sections 18'593 and 18594 of the Revenue and Taxation Code give the taxpayer a right to appeal from the action of respondent on a protest against a 'proposed assessment of personal income tax, and places the responsibility on this board to hear and determine such appeals." (Dauberger, p. 124-125).

e.2. Refutation: It is a fact that West's Ann.Cal.Rev. & Tax. Code (2001), §§ 18592-18597 actually reads:

§§ 18592 to 18597. Repealed by Stats.1993, c. 31 (S.B.3), § 18, eff. June 16, 1993, operative Jan. 1, 1994.

f.1. SBE statement: "The regulations governing the hearing procedures of this board also place the burden of proof upon the appellant-taxpayer. (Cal,. Admin. Code, tit. 18, § 5036.)"(Dauberger, p. 125).

f.2. Refutation: It is a fact that The California Administrative Code has been superseded by Barclays California Code of Regulations.
Cal.Code Regs., tit. 1, (unnumbered page equivalent to p. ii, second paragraph (2001)) reads (in part):

Barclays Official California Code of Regulations, as revised April 1, 1990, has been certified by the Office of Administrative Law as the official publication of the State of California for this purpose pursuant to title 1, California Code of Regulations, section 190.

§ 5036. Notices.
Any notice given pursuant to this article shall be served personally or by mail in the manner prescribed by statute for service of notice of a deficiency determination.

g.1. SBE statement: "Any arguments raised by appellants but not specifically addressed in this opinion have been considered and found to be utterly without merit." (Dauberger, p. 127)

g.2. Refutation: [Multiple derogatory expressions of disgust and disbelief deleted.] I reasonably infer that this statement is so impermissively overbroad as to cover a multitude of undisclosed taxpayer situations, arguments, or possible defenses, but provides absolutely no guidance/direction to anyone trying to rely upon said opinion.

g.3. I reasonably infer that SBE's statement is erroneous.

h.1. SBE statement: "Appellants and others similarly'situated should be aware the California Revenue and Taxation Code section 19414 is patterned-after the federal delay penalty. Section 19434 states:

"Whenever it appears to the State Board of Equalization or any court of record of this state that proceedings before it under this part have been instituted by the taxpayer merely for delay, a penalty in the amount not in excess of five hundred dollars ($500) shall be imposed, Any penalty so imposed shall be paid upon notice and demand from the Franchise Tax Board and shall be collected as a tax." (Dauberger, p. 128)

h.3. Further refutation: It is a fact that West's Ann.Cal.Rev. & Tax. Code (2001), § 19414 actually reads:

§ 19414. Repealed by Stats.1993, c. 31 (S.B. 3), 24, eff. June 16, 1993, operative Jan. 1, 1994

7.a. It is a fact that FTB's LEGAL RULING 92-1, p. 1, second paragraph reads:

All published Franchise Tax Board positions must be read in light of subsequent statutory, regulatory, administrative and judicial decisions. In some cases, the holding of Legal Rulings may have been completely superseded. In others, a particular statutory change or judicial interpretation may have modified the holding or ruling in some particular, but the balance of the reasoning or conclusion remains in effect.

7.c. I reasonably infer from LEGAL RULING 92-1 that FTB's continued reliance upon Appeal of FRED R. DAUBERGER, et al. (82-SBE-082) is erroneous because so many of the referenced statutes have been repealed/changed.

7.d. While I am aware that FTB is supposedly entitled to the Presumptions of correctness and regularity, the foregoing information, taken as a whole, discloses enough errors that I believe FTB's Presumptions have evaporated.

8. I reasonably infer that FTB LETTER EC 01-00099713, dated December 21, 2001, is equally erroneous for whatever purpose FTB intends, because it is tainted by Dauberger.

9. To the extent to which FTB purports this entire matter since July, 2001, to be/represent a FTB Tax Audit, FTB has failed to explain the intent or purpose of this proceeding, failed to act in good faith, and failed to timely resolve this matter.

10.a. I have personal knowledge (based upon information I generated and presented to FTB concerning the 1998 tax matter) in this specific instance that FTB's stated and presumed position: (1) 'taxpayer' is a 'tax protestor' (unsupportable and prejudicial); (2) who is trying to cheat FTB out of taxes (defamatory and prejudicial); (3) due from a SOLE PROPRIETORSHIP (non-existent to my knowledge); (4) which derived @ $30,000 income (I certainly did not work-for, earn, bill-for, or receive said income); (5) from a licensed activity as a security guard (statutorially impossible to be a 'licensed' security guard in California); (6) from sources in The State of California (not to my knowledge) is factually, and probably legally, baseless.

10.b. I reasonably infer that FTB has no valid claim for taxes.

10.c. I reasonably infer that FTB is not trying to collect taxes at all, but is attempting to acquire money from me under color of authority.

11. I claim the remedy of a speedy resolution to this matter.
I request that FTB hold a face-to-face hearing with me within the next thirty (30) days to resolve this matter or that FTB abate and withdraw its NPA.

I certify under the laws of the State of California, that the foregoing is true and correct.

Dated: __________________________________

At: _____________________________________

Signed: ________________________________________

Attachments:

Exhibit 1 (2 pages)
Exhibit 2 (13 pages)