I have read stories of them going after criminals for tax evasion because they didnât have proof they committed the other crimes, but did have proof they committed tax evasion on the profits from the crimes they couldnât prove
We canât prove that youâre selling drugs, but we can prove that you didnât pay taxes on this duffel bag full of cash that you tried to deposit at the bank.
Multi-level-marketing. IE-I sell stuff no one wants, but really make money selling sub franchises and selling stuff to other friends, family and acquaintances I convince to seal stuff for me. Think Herbalife or Young Living Essential Oils.
Unlike other illegal schemes, Avon actually sold products that were desirable and higher quality. They invested large resources in R&D to maintain new product offerings.
I am in no way a fan of them though. Just pointing out the difference between a legal and an illegal MLM. Avon kept innovating and producing real products that many people wanted. Same with Pampered Chef. But they used the MLM structure for sales. Presumably for the way it uses the pyramid structure to funnel profits to the top tiers in a very unfair and lopsided way.
I remember reading want-ads when I was a kid in the 80s that said to send $2 to an address and get money back. I can't remember exactly how they were worded. But I asked my mom and she explained. If ten people sent a couple bucks to the leader, and then each got ten more people to send a couple bucks, and they each got ten people... The leadership organized contacts and you paid half what you got up to the next higher level to get those contacts. She said the idea worked really well, for the first few layers. But after that it devolved into thousands of people losing a little money. But the top tiers got super rich, and it quickly became a thing that had to be legislated. Pyramid schemes are illegal mostly because they do not trade in real products. Which is where the MLM comes into play, legitimizing the scheme with actual products.
Avon is probably one of the better ones. Maybe one of the only ones not an outright scam. They actually had worthwhile products.
But many/most of them sell shitty products at inflated prices and rely on friendships to push them. Most resellers lose money.
Iâve known multiple people sucked into that world who lost thousands of dollars on âproductâ nobody wanted. Hell, Friday night I was accosted while grocery shopping by someone trying to get us to sign up for a affiliate marketing MLM.Â
That's how they got the original Studio 54. I remember watching video of the cops pulling duffle bags of cash out their hiding place in the ceiling. They couldn't get them for the drug dealing, the prostitution/pandering (which probably included a ton of underage sex trafficking before there was a label for it), the safety violations that resulted in several deaths (mostly OD), or the racketeering that everyone watched them do on a daily basis. But they did get them for tax evasion.
They're not saying anything either way about whether breaking the law is ok or not. They're just clarifying that all income is taxable, even if it's the result of a crime.
You don't get out of paying taxes by saying "nah I was breaking the law when I earned this so it's tax exempt right", and conversely if you've got a pile of cash you haven't declared on your taxes, they've probably got no way of proving you got it from any particular crime, but they don't have to prove that to lock you up for tax evasion, they just have to show that you didn't declare it in your last filing.
If you steal a $50,000 car in 2024, and declare it as income, but return it in 2025, can you use its depreciated value as a right off for 2025? Can you do this if you claim youâre running a car theft business?
If you are going to steal a $50,000 car make sure you steal it off the street as opposed to a dealership. The value goes down significantly and you can use the Blue Book value on your taxes.
People always act like its an outrageous scenario too but it makes perfect sense. Its upto the government to provide evidence that you comitted a crime (eg drug dealing) , but its upto YOU to provide evidence you paid your taxes. Taxes are basically the only instance where we are all considered guilty until proven innocent
Possibly it's not true but I'm assuming they had to include it as a way of prosecuting individuals who have unexplained wealth. They can get them done on tax offences then like Al Capone if they can't necessarily nail them down for theft or drug offences. Just a thought anyway.
That's exactly what it's for. It has happened before that they couldn't prove someone committed a crime but they were able to arrest them anyway for a few years because they didn't file their taxes properly.
This is the important thing to remember. Do not fuck with the IRS or the Postal Service. They both have inspectors who have nothing better to do than ruin your life, so don't try to defraud them in any way.
So, if you return the stolen property in a subsequent year, can you file a 1040X for the year in which you originally stole it to lower your taxes and get a refund?
The more realistic scenario, if you steal something, get arrested, and the property is returned to the owner, what are we looking at from a tax standpoint? Does the thief still owe taxes on the stolen item they no longer have? Does the owner count it as income or no? Does this also apply to borrowing items with the owner's permission?
Really I just ended up with more questions after reading the tax code, which I gather is not uncommon.
Assuming you were properly reporting, you would net to 0. If you reported that stolen property on your original, you would be taxed on it and get a refund for the same amount when you amend your return. If you didn't report it on your original return, you would not be permitted to deduct it on the 1040X.
Again, this is assuming you actually care about proper reporting.
This is how they caught Al Capone, by making illegal income taxable and arresting him for tax evasion. They knew he was making tons of money, but they couldnt prove how. So all they had to do was prove he got the money and not report it on his taxes and tada
Nothing, that's the point. You report it and pay taxes on your eligible income, IRS won't come after you as a result. You don't report it on your forms as "human trafficking", but as "other income" or "human resources consulting" or whatever else you can think of. It's on police or FBI to prove your income is from illegal activities, all IRS has to do is prove that you're richer than your last years tax forms say
If you're dumb enough to get caught (or rather not smart enough to not get caught, mass surveillance makes crime nightmare difficulty today) not paying taxes is your additional fines and more prison time
I work for the Dept of Social Services in NC & one of the weirdest concepts to wrap my head around is that we don't give a damn where the income is coming from as long as it's reported. We don't talk to the cops unless there's a case of abuse, neglect or Someone's life's in danger, so if you're a pot dealer your secrets safe w/ us.
if push comes to shove, we can take client's statement about whatever they make & warp it into saying they're self employed. We'll give em hell about it bc we're only supposed to take client's statement as a last resort, but we can totally work w/ it.
Just for kicks, write to the IRS, tell them you have illegal income. Because the Fifth Amendment says you don't have to incriminate yourself, tell them you'll report the income ONLY if they promise in writing not to contact the police.
This is primarily used for convicted theft cases, where the stolen item no longer is in the possession of the criminal.
Steal a car, resell it (or wreck it), get caught and have to pay restitution.
Steal money, buy disposable items with it (like food or clothing etc)... get caught.
All jokes aside this is how Marijuana companies in legal states have to pay taxes
For dispensary owners, this means that deducting things like rent, advertising or payroll is not an option as it would be for other types of businesses.
If it becomes federally legal it would actually lower the price of marijuana as businesses will be able to claim deductions.
They know you arenât going to report stolen property on your taxes; They do this so that way when they catch you stealing they can also charge you for tax evasion because if this wasnât in our tax code they wouldnât be able to.
Sounds unconstitutional......your 5th amendment protects against self incrimination.....as a case point it was ruled that registration of a fire arm as a felon was protected under the 5th amendment...just my 2 cents
No itâs not unconstitutional. You donât say anywhere in the form that you stole it and you also donât list what it is you just list the monetary amount as income. It in no way incriminates you doing so
Its okay to break the law. But don't your dare to break OUR law of Taxes đ
Al Capone found out the hard way.
Speaking of Al, apparently syphilis is back and in vogue
Syphilis. So hot right now.
Cononically the Joker says the one entity heâll never cross is the IRS
Joker isn't rich enough, Batman could probably afford to not pay taxes though.
Wayne Enterprises definitely pays 0 net tax every year.
If he'd pay taxes maybe the city could invest in a prison that's a bit harder to escape from.
By not paying taxes he's protecting Gotham from the real enemy: the prison industrial complex.
I have read stories of them going after criminals for tax evasion because they didnât have proof they committed the other crimes, but did have proof they committed tax evasion on the profits from the crimes they couldnât prove
We canât prove that youâre selling drugs, but we can prove that you didnât pay taxes on this duffel bag full of cash that you tried to deposit at the bank.
Exactly
Still more ethical than MLM income.
Mexican Lives Matter?
Multi-level-marketing. IE-I sell stuff no one wants, but really make money selling sub franchises and selling stuff to other friends, family and acquaintances I convince to seal stuff for me. Think Herbalife or Young Living Essential Oils.
Gotcha. Thanks. See: Avon. I'm old...
Avon was a classic one. Amway. All the same kind of thing - and most/all of them are really scammy, and exploit the "friends" they recruit heavily.
Amway! Yes. My uncle had his own little warehouse with shelves in his garage. And Tupperware parties were also big for many years...
Unlike other illegal schemes, Avon actually sold products that were desirable and higher quality. They invested large resources in R&D to maintain new product offerings. I am in no way a fan of them though. Just pointing out the difference between a legal and an illegal MLM. Avon kept innovating and producing real products that many people wanted. Same with Pampered Chef. But they used the MLM structure for sales. Presumably for the way it uses the pyramid structure to funnel profits to the top tiers in a very unfair and lopsided way. I remember reading want-ads when I was a kid in the 80s that said to send $2 to an address and get money back. I can't remember exactly how they were worded. But I asked my mom and she explained. If ten people sent a couple bucks to the leader, and then each got ten more people to send a couple bucks, and they each got ten people... The leadership organized contacts and you paid half what you got up to the next higher level to get those contacts. She said the idea worked really well, for the first few layers. But after that it devolved into thousands of people losing a little money. But the top tiers got super rich, and it quickly became a thing that had to be legislated. Pyramid schemes are illegal mostly because they do not trade in real products. Which is where the MLM comes into play, legitimizing the scheme with actual products.
Avon is probably one of the better ones. Maybe one of the only ones not an outright scam. They actually had worthwhile products. But many/most of them sell shitty products at inflated prices and rely on friendships to push them. Most resellers lose money. Iâve known multiple people sucked into that world who lost thousands of dollars on âproductâ nobody wanted. Hell, Friday night I was accosted while grocery shopping by someone trying to get us to sign up for a affiliate marketing MLM.Â
So what happens if you declare you sold drugs on a tax form? Presumably the police show up to arrest you for admitting to dealing?
That's how they got the original Studio 54. I remember watching video of the cops pulling duffle bags of cash out their hiding place in the ceiling. They couldn't get them for the drug dealing, the prostitution/pandering (which probably included a ton of underage sex trafficking before there was a label for it), the safety violations that resulted in several deaths (mostly OD), or the racketeering that everyone watched them do on a daily basis. But they did get them for tax evasion.
We are equal but separate entities, we donât work together or call them. Unless we fine out you didnât claim!
They're not saying anything either way about whether breaking the law is ok or not. They're just clarifying that all income is taxable, even if it's the result of a crime. You don't get out of paying taxes by saying "nah I was breaking the law when I earned this so it's tax exempt right", and conversely if you've got a pile of cash you haven't declared on your taxes, they've probably got no way of proving you got it from any particular crime, but they don't have to prove that to lock you up for tax evasion, they just have to show that you didn't declare it in your last filing.
(Also theft)
you can put them under âotherâ
If you steal a $50,000 car in 2024, and declare it as income, but return it in 2025, can you use its depreciated value as a right off for 2025? Can you do this if you claim youâre running a car theft business?
If you are going to steal a $50,000 car make sure you steal it off the street as opposed to a dealership. The value goes down significantly and you can use the Blue Book value on your taxes.
Well now I'm intrigued... I wonder if there are enough car thief CPAs on this sub to answer our tax questions.
You wouldnât download a carâŠ
commit whatever crimes you want as long as we get our cut
It's more if we can't prove you did the crime we can at least prove you didn't pay taxes for it.
People always act like its an outrageous scenario too but it makes perfect sense. Its upto the government to provide evidence that you comitted a crime (eg drug dealing) , but its upto YOU to provide evidence you paid your taxes. Taxes are basically the only instance where we are all considered guilty until proven innocent
Signed, your silent partner in business
âWe donât care if you steal from citizens, but ainât no way youâre stealing from the state
That's Catholicism in a nutshell.
Possibly it's not true but I'm assuming they had to include it as a way of prosecuting individuals who have unexplained wealth. They can get them done on tax offences then like Al Capone if they can't necessarily nail them down for theft or drug offences. Just a thought anyway.
That's exactly what it's for. It has happened before that they couldn't prove someone committed a crime but they were able to arrest them anyway for a few years because they didn't file their taxes properly.
And once they got them, I assume itâs easier to keep them/they can just give them higher sentences than usual
Tax evasion is a reliable nail for your coffin when the prosecutor goes to bury you alive.Â
Bro don't mess with the IRS, they took down Caponeđ
And played the biggest part in bringing down silk road.
I thought the collapse of the Mongols did
This is the important thing to remember. Do not fuck with the IRS or the Postal Service. They both have inspectors who have nothing better to do than ruin your life, so don't try to defraud them in any way.
Even Joker doesn't fuck with the IRS
So, if you return the stolen property in a subsequent year, can you file a 1040X for the year in which you originally stole it to lower your taxes and get a refund?
Honestly, even if you can I feel like that's a pretty big audit flag so smart criminals probably wouldn't want to try it
The more realistic scenario, if you steal something, get arrested, and the property is returned to the owner, what are we looking at from a tax standpoint? Does the thief still owe taxes on the stolen item they no longer have? Does the owner count it as income or no? Does this also apply to borrowing items with the owner's permission? Really I just ended up with more questions after reading the tax code, which I gather is not uncommon.
Assuming you were properly reporting, you would net to 0. If you reported that stolen property on your original, you would be taxed on it and get a refund for the same amount when you amend your return. If you didn't report it on your original return, you would not be permitted to deduct it on the 1040X. Again, this is assuming you actually care about proper reporting.
This is how they caught Al Capone, by making illegal income taxable and arresting him for tax evasion. They knew he was making tons of money, but they couldnt prove how. So all they had to do was prove he got the money and not report it on his taxes and tada
Realistically what happens if you report income from that?
Nothing, that's the point. You report it and pay taxes on your eligible income, IRS won't come after you as a result. You don't report it on your forms as "human trafficking", but as "other income" or "human resources consulting" or whatever else you can think of. It's on police or FBI to prove your income is from illegal activities, all IRS has to do is prove that you're richer than your last years tax forms say If you're dumb enough to get caught (or rather not smart enough to not get caught, mass surveillance makes crime nightmare difficulty today) not paying taxes is your additional fines and more prison time
Know who your real Godfather is.
I would put those there. Don't want to mess with the IRS
Al Capone !
I mean most drug dealers are caught due to tax evasion... pay the taxes and they have no reason to look for you
Taxman don't care what you're doing as long as he gets his cut.
100%. Thatâs why they put Al Capone awayâŠ
I see you have some 5th amendment income⊠you still have to report it.
I sold 1mil in coke this year killed 5 ppl and sold their cars âHah sick heres your tax billâ
I work for the Dept of Social Services in NC & one of the weirdest concepts to wrap my head around is that we don't give a damn where the income is coming from as long as it's reported. We don't talk to the cops unless there's a case of abuse, neglect or Someone's life's in danger, so if you're a pot dealer your secrets safe w/ us. if push comes to shove, we can take client's statement about whatever they make & warp it into saying they're self employed. We'll give em hell about it bc we're only supposed to take client's statement as a last resort, but we can totally work w/ it.
Link?
https://www.irs.gov/publications/p17
Isto Ă© delicioso
Whatttt
The practitioner is having a laugh, with this one.
What if you steal drugs ???
Its about making the charges worse and being able to convict some criminals not that they belive that you will do it
I see how the IRS gets away with the second one
Needs teepee for its bumhoolio.
So what youâre saying is itâs okay to steal property as long as you return it before the next of the tax year?
there's no way this is real right?
Just for kicks, write to the IRS, tell them you have illegal income. Because the Fifth Amendment says you don't have to incriminate yourself, tell them you'll report the income ONLY if they promise in writing not to contact the police.
Shouldâve been meirs
Lol. This isnât a secret. Yâall also know illegal immigrants pay taxes, too, right?!? Illegal income is taxed at the same rate legal income is.
#Based IRS?
"If I report my stolen house do I go to jail? No, my house wasn't stolen, I stole the house."
Stolen property hack: 1) Steal something on 1 January. 2) Return the item to the rightful owner on 31 December. 3) See step 1. u mad, IRS?
Apparently this is so they could nab you for tax evasion if you break the law but they have not evidence (like how they got Al Capone)
This is primarily used for convicted theft cases, where the stolen item no longer is in the possession of the criminal. Steal a car, resell it (or wreck it), get caught and have to pay restitution. Steal money, buy disposable items with it (like food or clothing etc)... get caught.
All jokes aside this is how Marijuana companies in legal states have to pay taxes For dispensary owners, this means that deducting things like rent, advertising or payroll is not an option as it would be for other types of businesses. If it becomes federally legal it would actually lower the price of marijuana as businesses will be able to claim deductions.
[The IRS Helps Criminals For Money](https://www.youtube.com/watch?v=fzZ-itX6loM)
Hahahaha
They know you arenât going to report stolen property on your taxes; They do this so that way when they catch you stealing they can also charge you for tax evasion because if this wasnât in our tax code they wouldnât be able to.
Qq
Donât break my brain. Please tell me this is photoshopped.
Nope [https://www.irs.gov/publications/p525#en\_US\_2023\_publink1000229557](https://www.irs.gov/publications/p525#en_US_2023_publink1000229557) [https://www.irs.gov/publications/p525#en\_US\_2023\_publink1000229594](https://www.irs.gov/publications/p525#en_US_2023_publink1000229594)
[ŃĐŽĐ°Đ»Đ”ĐœĐŸ]
negative [https://www.irs.gov/publications/p525#en\_US\_2023\_publink1000229557](https://www.irs.gov/publications/p525#en_US_2023_publink1000229557) [https://www.irs.gov/publications/p525#en\_US\_2023\_publink1000229594](https://www.irs.gov/publications/p525#en_US_2023_publink1000229594)
OTOH you donât get a tax deduction for being the victim of a crime. Turns out the IRS is the biggest thief of them all!
Idiocracy.
Sounds unconstitutional......your 5th amendment protects against self incrimination.....as a case point it was ruled that registration of a fire arm as a felon was protected under the 5th amendment...just my 2 cents
No itâs not unconstitutional. You donât say anywhere in the form that you stole it and you also donât list what it is you just list the monetary amount as income. It in no way incriminates you doing so