IRS asks Americans to pay taxes on illicit income

0

December 31 (THEWILL) – Have you received any bribes lately? Hijacked from your business? Do you have stolen goods? The IRS would like to know if you are American.

Shocked by these questions? Don’t, because the U.S. Internal Revenue Service (IRS) has asked Americans to pay taxes on illicit income, as outlined in the U.S. Tax Code.

According to the IRS, people who have profited from illicit acts such as drug trafficking or bribery must include it on their 2021 tax returns. If it is from self-employment activity, it must be declared on Schedule 1 (Form 1040), line 8z or Schedule C (Form 1040). This includes sales from drug trafficking, embezzlement, etc.

The taxation of illegal income in the United States stems from provisions of the Internal Revenue Code (IRC), enacted by the United States Congress in part for the purpose of taxing net income. As such, a person’s taxable income will generally be subject to the same federal tax rules whether the income was obtained legally or illegally.

Internal Revenue Service Publication 17 contains a section on stolen property.

According to the IRS, income from stolen goods or other illegal activity must be reported when Americans file their taxes.

“If you steal property, you must report its fair market value in your income in the year you steal it, unless you return it to its rightful owner that same year,” the directive says.

“Income from illegal activities, such as money from illegal drug trafficking, must be included in a taxpayer’s 2021 returns. It should be included in Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if it is a self-employed activity, ”the tax code said.

The IRS also noted that thieves must report the value of property they have stolen, unless the property is returned to the “owner in the same year.”

“If you steal property, you must report its fair market value in your income in the year you steal it, unless you return it to its rightful owner that same year,” adds the Code.

The requirements also made it clear that if you receive a bribe, you must “include it in your income” and state that taxpayers must also “include bribes, ancillary commissions, remittance. money or similar payments ”.

On Tuesday, the Erie County Sheriff’s Office in Buffalo, New York, offered support to “all car thieves” who need a detailed list of the property they have stolen, so they can be declared on their income taxes.

“Watch out for all car thieves. The things you stole from people’s vehicles in 2021 should be deducted from your income taxes. If you need a detailed list of properties, give us a call at 716.858.2903 and an assistant or detective will be happy to meet you with the list. We would be happy, ”the sheriff’s office wrote.

The issue of reporting illicit income to the government has raised questions even before the highest court in the United States.

An ongoing case arose in 1927 (United States v Sullivan), where the United States Supreme Court considered whether prosecuting criminals for tax evasion on illegal income violated the Fifth Amendment provision of the Bill of Rights. which protects against self-incrimination.

In that case, a South Carolina smuggler challenged his conviction on federal charges on the grounds that he could not be held to incriminate himself by reporting illegal income.

However, in a unanimous opinion, Judge Oliver Wendell Holmes Jr. rejected this argument.

Nearly a century later, this opinion of the court still holds. Since then, many criminals have been convicted of tax evasion in the same way, including Al Capone in 1931.

According to the Internal Revenue Service (IRS), income from criminal behavior must be reported on your taxes.


Source link

Share.

About Author

Comments are closed.