Report All The Money You Steal Or Find On The Street On Your Tax Return
I literally laughed out loud as I was researching for this blog and came across an article entitled, Don’t Forget To Declare Income From Stolen Goods And Illegal Activities, IRS Says. I simply couldn’t let this one go! Apparently the article went viral on social media and I can see why. As a tax attorney I had all kinds of funny thoughts and images immediately pop into my head. I mean here’s an entire subset of new clients to market to! Can you imagine appealing to the scam artists, illegal drug dealers and the petty thieves to get their taxes done and declare all the stuff they’ve stolen and or sold illegally? I suppose I might have to start asking my clients if they’ve stolen anything or bribed anyone during the previous tax year.
The fact is that there is an actual IRS publication that states this. “According to IRS publication 17,” the article states, “the Internal Revenue Service wants taxpayers to include on their forms “income from illegal activities, such as money from dealing illegal drugs.” Make sure you put that on “Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity,” the IRS wrote. The agency also requests that “if you steal property, you must report its fair market value,” but only if you don’t “return it to its rightful owner in the same year.” https://www.nbcnews.com/business/taxes/dont-forget-declare-income-stolen-goods-illegal-activities-irs-says-rcna10345
As all of us law-abiding tax paying citizens know that the IRS wants every bit of income reported so they get their share. So, consider this a reminder as we head into tax season. If you get paid to do something illegal or even if you find money on the street, the IRS considers that taxable income! So don’t forget to report it!