It sounds odd but there was a Supreme Court about it. Essentially someone claimed they shouldn’t have to pay taxes on the profits of crime and the Court ruled they did. So they had to create a way for people to do that. For what it is worth, the 5th amendment protects you from incriminating yourself, so you are allowed to decline to provide the details of where the money came from, but it’s a bit like paying your parents for something you broke and then just not telling them what it is, and then expecting them not to look around the house.
“it would be an extreme if not an extravagant application of the Fifth Amendment to say that it authorized a man to refuse to state the amount of his income because it had been made in crime. … He could not draw a conjurer’s circle around the whole matter by his own declaration that to write any word upon the government blank would bring him into danger of the law.” … "It is urged, that, if a return were made, the defendant [Sullivan] would be entitled to deduct illegal expenses, such as bribery. This by no means follows, but it will be time enough to consider the question when a taxpayer has the temerity to raise it.”
Completely seriously; while I’m sure essentially no one actually does, the IRS is not going to like network with the FBI or your local police department if you, for some reason, decide to pay taxes on your weed sale profits. Unless you report that you’re selling sex slaves they seriously could not care less.
I know it’s just a joke image but I do love the idea of someone who makes much of their money illegally but also has this very honorable commitment to paying their fair share in taxes.
…I do love the idea of someone who makes much of their money illegally but also has this very honorable commitment to paying their fair share in taxes.
There’s, perhaps, a more practical explanation. As I’ve read before (in some other phrasing): If you’re going to commit a crime, commit only one at a time.
In this case, if you’re going to make your money illegally, for goodness’ sake, don’t evade taxes.
Also on virtually every gangster or crime movie/series there is either a bad guy getting caught by irs(?) agents for tax evasion, or plays it super safe and pays them diligently to avoid that very scenario.
This is absolutely it.
Its just one less way that they can come at you, it also means its harder for them to confiscate your property as proceeds of crime.
Seriously though, some people have almost pulled off some crazy illegal shit and then got caught because a headlight was out or someone was doing something stupid. If you’re going to commit crime, one at a time.
Wasn’t that one woman who lied about cancer and stole hundreds of thousands of dollars fully brought down for tax evasion because they couldn’t really get her on much else? The scamanda woman
I know it’s just a joke image but I do love the idea of someone who makes much of their money illegally but also has this very honorable commitment to paying their fair share in taxes.
If you’re convicted of criminal activity you’d be smart to include that in your taxes. The last thing you need is to be convicted of tax fraud in addition to getting convicted of drug trafficking. If the government already has a record of you profiting from criminal activity, make sure you give them their cut.
As the joker once said:
I’m crazy enough to take on batman, but the IRS? No thank you
So then if you get caught and these are taken away from you, I assume you can declare it as a loss and get an equivalent deduction the next year? I wonder if anyone’s ever used this to their advantage to game their tax rates?
“damn, I can’t steal any more this year or I go up another tax bracket”
