I 
114TH CONGRESS 
2D SESSION 
H. R. 6098 
To amend the Internal Revenue Code of 1986 to repeal the withholding 
of income and social security taxes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 21, 2016 
Mr. SANFORD (for himself, Mr. CRAMER, and Mr. BRAT) introduced the 
following bill; which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to repeal 
the withholding of income and social security taxes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Transparent Recogni-
tion of Unjustified Tax Hoarding in Government Act of 
2016’’ or as the ‘‘TRUTH in Government Act of 2016’’. 
SEC. 2. FINDINGS. 
Congress finds the following: 
(1) At the onset of the Civil War, Congress 
passed the Revenue Act of 1861, which imposed a 
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tax on personal incomes and to assure timely collec-
tion, taxes were ‘‘withheld at the source’’ by employ-
ers. 
(2) The need for Federal revenue declined 
sharply after the war and in 1872, the income tax 
was abolished and along with it, the Federal with-
holding mandate. 
(3) With passage of the 16th amendment to the 
Constitution, Congress swiftly passed legislation cre-
ating a Federal income tax, withheld before em-
ployee salaries were paid. 
(4) In response to growing taxpayer criticism of 
the withholding mandate, Treasury Secretary Wil-
liam G. McAdoo stated that ‘‘it would be very ad-
vantageous to . . . do away with the withholding of 
income tax at the source’’ because it would ‘‘elimi-
nate a great deal of criticism which has been di-
rected against the law’’; a statement reflecting the 
sentiment which ultimately led to the repeal of Fed-
eral withholding authority in 1917. 
(5) In the 1920s and 1930s, income taxes were 
due on March 15 following the end of the tax year 
and could be paid either in one lump sum on that 
date or in quarterly installments. 
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(6) With the onset of World War II, fearing 
that taxpayers might refuse to pay the higher tax 
rates and surcharges associated with funding the 
war effort, Federal officials, lawmakers, and political 
leaders such as President Franklin D. Roosevelt 
used the military crisis to draw on Americans’ sense 
of patriotism and resurrect the Federal withholding 
authority as a ‘‘temporary wartime measure’’. 
(7) The campaign to reinstitute a permanent 
system of withholding overcame public hostility with 
the passage of the Withholding Tax Act of 1943 
which incorporated suggestions proffered by Beards-
ley Ruml to eliminate individuals’ 1942 tax liabilities 
by counting amounts paid or withheld in 1943 as 
tax payments for that year. 
(8) Since that time, Congress has stubbornly 
refused to repeal the Federal withholding mandate 
contained in the Withholding Tax Act. 
(9) In fiscal year 2014, the Internal Revenue 
Service refunded overpayments amounting to over 
$330,561,145,000 more than actual individual in-
come tax liabilities, effectively denying interest pay-
ments otherwise owed to taxpayers and amounting 
to a hidden tax. 
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(10) These overpayments are returned annually 
in the form of tax refunds to taxpayers who often 
confuse the payments as a reward. 
(11) According to the Tax Foundation, in 2010, 
there were 58,416,118 tax returns with zero or neg-
ative income tax liability, or 41 percent of the 
142,892,051 returns filed. 
(12) The absence of the Federal withholding 
mandate leaves employers and employees free to ne-
gotiate alternative, private means of collecting and 
paying Federal income taxes, thereby allowing indi-
viduals to voluntarily earn interest on their 
withhholdings. 
(13) The Federal withholding mandate allows 
the Federal Government to disguise tax increases 
and hampers Federal accountability and trans-
parency by requiring the assistance of an inter-
mediary tax collector. 
(14) Complying with the Federal withholding 
mandate imposes costly burdens and legal liabilities 
on employers forced to act as de facto IRS agents, 
without compensation for lost time and resources. 
(15) Referring to the Federal withholding man-
date in his work Public Finance in Democratic Proc-
ess: Fiscal Institutions and Individual Choice, 1986 
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Nobel Prize winning economist James Buchanan 
stated that ‘‘The individual who does not have pos-
session of income before paying it out cannot’’ sense 
‘‘the real cost of public services in a manner com-
parable to that experienced in a genuine act of 
outpayment’’. 
(16) In a CATO Institute study, Charlotte 
Twight has noted that ‘‘[W]ithholding is the para-
mount administrative mechanism enabling the Fed-
eral Government to collect, without significant pro-
test, sufficient private resources to fund a vastly ex-
panded welfare state.’’ 
(17) The National Taxpayers Union notes that 
the incremental nature of withholding masks the 
true cost of Federal income taxes, which would be 
much more apparent if individuals had to write 
monthly, quarterly, or annual checks to the Federal 
Government. 
SEC. 3. PURPOSE. 
The purposes of this Act are— 
(1) to increase transparency and accountability 
in the Federal tax system by providing the public 
with a more accurate account of— 
(A) the annual tax burden; and 
(B) the Federal budget deficit; 
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(2) to decrease the overall tax burden and in-
crease the personal wealth of taxpayers by allowing 
for the personal collection of interest during the fis-
cal year on overpayments that are otherwise used by 
the Federal Government to partly avoid interest pay-
ments; 
(3) to decrease the burden on employers by 
freeing them from the task of collecting income tax 
withholding from their employees; and 
(4) to end the deceptive practice of masking 
higher tax rates from taxpayers. 
SEC. 4. REPEAL OF FEDERAL INCOME AND SOCIAL SECU-
RITY TAX WITHHOLDING MANDATE. 
(a) IN GENERAL.—The following provisions of the In-
ternal Revenue Code of 1986 are hereby repealed: 
(1) Section 3102 (relating to deduction of social 
security tax from wages). 
(2) Section 3202 (relating to deduction of rail-
road retirement tax from compensation). 
(3) Chapter 24 (relating to income tax with-
holding). 
(b) REQUIREMENT OF ESTIMATED TAX PAYMENTS 
FOR EMPLOYEE SOCIAL SECURITY TAXES.—Subsection 
(f) of section 6654 of such Code is amended by redesig-
nating paragraphs (3) and (4) as paragraphs (4) and (5), 
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respectively, and by inserting after paragraph (2) the fol-
lowing new paragraph: 
‘‘(3) the taxes imposed by section 3101(a) and 
3201(a), plus’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts paid on or after the 
first January 1 occurring after 1 year after the date of 
the enactment of this Act. 
SEC. 5. CONTINUED VOLUNTARY TAX WITHHOLDING. 
(a) AUTHORITY OF THE IRS.—Nothing in this Act 
may be construed to limit the authority of the Internal 
Revenue Service to accept voluntary tax payments from 
employers electing to continue collecting Federal income 
taxes from employees. 
(b) VOLUNTARY EMPLOYER PARTICIPATION.—Noth-
ing in this Act shall be construed to prevent voluntary em-
ployer sponsored withholding of Federal income taxes on 
behalf of employees. 
(c) VOLUNTARY EMPLOYEE PARTICIPATION.—Noth-
ing in this Act shall be construed— 
(1) to require any employee to participate in an 
employer Federal income tax withholding system; or 
(2) to prevent any election of an employee to 
opt in to an employer Federal income tax with-
holding system, with all terms and conditions for 
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participation being negotiable between the employee 
and employer. 
Æ 
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