An IRS publication states: “Stolen property. If you steal property, you must report its fair market value in your income in the year you steal it unless in the same year, you return it to its rightful owner.”
Tax Foundation: “It’s funny but true; thieves must pay income tax on stolen property they keep or face tax evasion charges. (As they say, it’s how they got Capone.) But since the Constitution protects individuals from incriminating themselves, you can tuck it into the ‘Other Income’ line. In Sullivan v. United States, 274 U.S. 259 (1927), a liquor bootlegger was charged with tax evasion for not reporting his illicit income, and he argued that to do so would be self-incrimination in violation of the Fifth Amendment guarantee. Justice Holmes, writing for the U.S. Supreme Court majority, first dismisses the idea that illegally acquired income is exempt from income tax:”
We see no reason to doubt the interpretation of the Act, or any reason why the fact that a business is unlawful should exempt it from paying the taxes that, if lawful, it would have to pay. (274 U.S. at 263.)
Related posts:
- Tax Cheats Nabbed After Blogging About It
- 2010 Federal Income Tax Rates
- Pro Golfer Thorpe Sentenced to Prison for Tax Evasion
- Is Your Nonprofit at Risk of Losing Its Tax-Exempt Status?
- IRS Debunks Common Frivolous Anti-tax Claims Made by Ignorant Idiots
- Federal Income Tax Consequences of Home Foreclosures & Cancellation of Indebtedness
- Top 7 Tax Resolution Lessons Learned from the Worst Cases of Celebrity Tax Evasion
- To Close Deficit, Federal Income Tax Rates Would Have to Nearly Triple
- Ten Ways To Audit Proof Your Tax Return
- Tax Hikes: An Economic Time Bomb
Recent Comments