As the days lengthen, warm weather returns and the sublime signs of Spring show themselves all around us, our thoughts naturally turn to income tax season.
If you are in the United States or subject to US law, you know that April 15 is Tax Day. The laborious, joy-sucking, and migraine-inducing annual tradition of compiling receipts, adding numbers, and tracking down forms is once again upon us.
There are thousands of tax-related rules and regulations. Any one of them may or may not apply to you. You should always seek the help of a professional if you have questions about your tax situation.
Although we do not attempt to offer tax preparation advice to the masses, as a public service, Commonplace Fun Facts offers the following tax tips to all the criminals out there who want to fulfill their civic duty by paying Uncle Sam everything he’s entitled to.
IRS Publication 525 addresses the complex issue of taxable and nontaxable income. Within its 43 pages, it answers questions about how to treat rental income, wages, earnings from small businesses, and sundry other situations. It also contains several sections that every tax-savvy criminal will want to note.
Bribes
If you are a public official or in any position of leadership or authority and you accept money, goods, or services in exchange for using your position to do something contrary to what you are supposed to do, you have accepted a bribe. Bribery is a bad thing. Offering bribes is illegal. Accepting bribes is also illegal.
It turns out that failure to report bribes and pay taxes on them is also illegal. Publication 525 includes a section entitled “Bribes.” It contains this helpful instruction: “If you receive a bribe, include it in your income.”
Of course, if you report a bribe as income, you are admitting that you broke the law. On a positive note, you won’t be making any enemies at the IRS, as long as you pay your taxes.
Stolen Property
Bribery isn’t the only illegal activity addressed in Publication 525. It also includes a section entitled “Stolen Property.” It tells us, “If you steal property, you must report its FMV in your income in the year you steal it unless, in the same year, you return it to its rightful owner.”
FMV stands for “fair market value.” This can be a handy distinction, depending on what you may have stolen. If you are a car thief, you benefit from the fact that cars decline in value from the moment they leave the dealership. The sticker price on your stolen set of wheels may be $50,000. If the Blue Book value is only $30,000 at the time you snag it, that’s the taxable amount.
Of course, if you steal something that appreciates, such as fine art or, sadly, eggs and milk, it may have been worth a modest amount originally. Whatever it sells for at the time you take possession is the amount that you are required to report.
It is worth noting that there is a loophole. If you return the stolen item in the same year in which you stole it, it is not a taxable event. You could, therefore, steal the Mona Lisa on January 1, hang it on your wall, and enjoy it for the next 364 days. As long as you get it back to the museum before the stroke of midnight on December 31, the IRS doesn’t care.
Illegal Activities
Your chosen profession may involve ongoing criminal activities. If so, you need to be prepared to pay the government its fair share of your profit. Publication 525’s section on “Illegal Activities” gives us these instructions: “Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity.
Since ongoing illegal activities are, in effect, a business, you are entitled to claim certain deductions to reduce your tax burden. The cost of doing business, such as employing hitmen, is deductible (assuming you report their wages on an appropriate W-2 or 1099). Supplies used in the furtherance of your business, such as bullets, zip ties, and severed horse heads are also deductible. (Please note that some items may need to be depreciated. Consult with a tax professional to determine the depreciation schedule for a severed horse head.) Your investment in your inventory is likewise deductible, so be sure to get a receipt when you purchase your bulk shipment of heroin.
Please be aware that since illegal activities are considered to be a business, you will need to budget for self-employment taxes in addition to the regular income tax.
We hope you found this advice helpful and that you will do the right thing and show the world what a respectable, law-abiding criminal does in a country that values the rule of law.
When FDR Couldn’t Make Sense of His Tax Return
If you have ever wanted to pull your hair out in frustration over the complexity of trying to figure out your income taxes, you are not alone.
Keep reading
Why Nevada Created a County With No People, Buildings, or Roads
Nevada has gained a reputation for converting harsh, barren desert land into thriving tourist destinations. This made its decision to create an empty county that much more curious. The new county had no residents, commerce, buildings, roads, or any private land. On top of that, its county seat was 270 miles distant. No one had…
Keep reading
How the Republic of Indian Stream Became a Country Between the United States and Canada
Commonplace Fun Facts loves Canada. We have written about its enlightened policies that have created the only rat-free territory in the world, the establishment of the Global Strategic Maple Syrup Reserve, and a “H0H0H0” postal code for Santa Claus. In short, we couldn’t be happier that our neighbor to the north is a BFF of…
Keep readingCategories: Careers, Crime, Government, Humor, Laws and Lawyers, Money, Stupidity
Commonplace Fun Facts 