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The pothead stimlus check

G

guest

inflorescence said:
Nope, you have to declare illegal income but can't deduct deductions on illegal activity.

Do you think the gov is stupid?
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Court held that the sixteeth amendment allows congress to tax real income. It did not give congress the right punish via the 16th. The 16th only provided congress the ability to collect taxes on real NET income.
 
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G

guest

While embezzlers, thieves, and the like are forced to report their ill-gotten gains as income for tax purposes, they may also take deductions for costs relating to criminal activity. For example, in Commissioner v. Tellier, a taxpayer was found guilty of engaging in business activities that violated the Securities Act of 1933.[7] The taxpayer subsequently tried to deduct from his gross income the legal fees he spent while defending himself.[8] The Supreme Court held that the taxpayer was allowed to deduct the legal fees from his gross income because they meet the requirements of §162(a).[9], which allows the taxpayer to deduct all the “ordinary and necessary expenses paid or incurred during the taxable year in carrying on a trade or business.”[10] The Court reasoned (and the Internal Revenue Service did not contest the point) that it was ordinary and necessary for a person engaged in a business to expect to have legal fees associated with that business, even though such things may only happen once in a lifetime.[11] Therefore, the taxpayer in Tellier was allowed to deduct his legal fees from his gross income, even though he incurred the fees because of his crime. The Tellier court reiterated that the purpose of the tax code was to tax net income, not punish unlawful behavior.[12] The Court suggested that if this was not the case, Congress would change the tax code to include special tax rules for illegal conduct.[13]
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Thanks LilWayne

Check with a lawyer. This is real.

Cash in your pocket!

Tell all your friends.

Have your lawyer tell all his friends. And clients also.
 
G

guest

trouble said:
PB, just a little food for thought. You should really try not to start so many multi-identical threads. If your not aware, Gypsy is already having to ask for donations just to keep this site alive, and you have started many, many, multi-idnetical threads. You have several indentical threads in every forum on the site, some with the same titles and others with varied titles and the exact same info. This thread being the latest example.

No offense intened my friend, I know you enjoy it here as much as myself and other members do. We all want ICMAG to stay around, and we all can help a little by trying to save bandwidth.


Take care. :wave:



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You're right. Gypsy is asking for donations for this site.

Mods: I haven't linked this site on the video page yet.

Should I do that or not?

If you are able to make cash because of IC please give at least a small part of that Gypsy to help keep IC running.
 
E

eyes

Active member
Veteran
so peanut butter,your saying that you are going to deduct all applicable legal fees to your agi?sou figure that would lower your tax bracket and you would be owed how much?
 
G

guest

For me an extra 12.5 k or so.

I have to double check make sure which deductions would apply.

Lawyers fees seem to be a given, though. That would be an extra 2.5k
 
T

the_shadow

PB is correct about this. My friend is a 30 year tax preparation guy, he's let me know some of the lesser known rules.

Just be careful... if you claim seeds from amsterdam, that might be a red flag :)
 
trouble

trouble

Well-known member
Veteran
Section 280E prohibits any deductions of business incurred in the illeagal drug trade.






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inflorescence

inflorescence

Active member
Veteran
Sec. 280E. Expenditures in connection with the illegal sale of
drugs

No deduction or credit shall be allowed for any amount paid or
incurred during the taxable year in carrying on any trade or
business if such trade or business (or the activities which
comprise such trade or business) consists of trafficking in
controlled substances (within the meaning of schedule I and II of
the Controlled Substances Act) which is prohibited by Federal law
or the law of any State in which such trade or business is
conducted.
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....................................................................................................
 
G

guest

First off .. The Supreme court trumps congress. Not a big leap there.

The Supreme Court ruled that:
1.Legal fees are a legitimate deduction even if the business is criminal.
2.They ruled that the sixteenth amendment does not make room for congress to punish, only to tax real income.

A lawyer fee is a real expense. It comes out of your pocket. If you have 10k in income and 10k in lawyers fees you have zero money left. Your business has provided zero real income.

Congress can not invent income for you to pay taxes on. They can not punish by way of the sixteenth amendment to fabricate income that doesn't exist in the real world.

Let's work together.
 
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G

guest

Note .. I'm still working on this.

The Supreme Court ruling that attorney fees were deductible even if they are for criminal activities took place in 1966.

Section 280e of tax code went into effect for tax year 1983.

I'm trying to find cases etc that would keep this out of the area of a constitutional battle.

The sixteenth amendment:

the constitution said:
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
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I could argue that the phrase "from whatever source derived" means that the same method to calculate income needs to be uniform across all of the US with no respect to the source of the income.

However, I don't want to go there. This would present a argument for a court fight. Which is not what I am looking for.

I quote this from the 1966 court ruling:

Only where the allowance of a deduction would "frustrate sharply defined national or state policies proscribing particular types of conduct" have we upheld its disallowance. Commissioner v. Heininger, 320 U.S. at 320 U. S. 473. Further, the "policies frustrated must be national or state policies evidenced by some governmental declaration of them." Lilly v. Commissioner, 343 U.S. at 343 U. S. 97. (Emphasis added.) Finally, the "test of nondeductibility always is the severity and immediacy of the frustration resulting from allowance of the deduction." Tank Truck Rentals v. Commissioner, 356 U. S. 30, 356 U. S. 35. In that case, as in Hoover Motor Express Co. v. United States, 356 U. S. 38, we upheld the disallowance of deductions claimed by taxpayers for fines and penalties imposed upon them for violating state penal statutes; to allow a deduction in those circumstances would have directly and substantially diluted the actual punishment imposed.

The present case falls far outside that sharply limited and carefully defined category. No public policy is offended when a man faced with serious criminal charges employs a lawyer to help in his defense. That is not "proscribed conduct." It is his constitutional right. Chandler v. Fretag, 348 U. S. 3. See Gideon v. Wainwright, 372 U. S. 335. In an adversary system of criminal justice, it is a basic of our public policy that a defendant in a criminal case have counsel to represent him.

Congress has authorized the imposition of severe punishment upon those found guilty of the serious criminal offenses with which the respondent was charged and of which he was convicted. But we can find no warrant for attaching to that punishment an additional financial burden that Congress has neither expressly nor implicitly

Page 383 U. S. 695

directed. [Footnote 11] To deny a deduction for expenses incurred in the unsuccessful defense of a criminal prosecution would impose such a burden in a measure dependent not on the seriousness of the offense or the actual sentence imposed by the court, but on the cost of the defense and the defendant's particular tax bracket. We decline to distort the income tax laws to serve a purpose for which they were neither intended nor designed by Congress.
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The hiring of an attorney is not a bad thing that undermines public policy. It is a right protected by the constitution.
http://supreme.justia.com/us/383/687/case.html#693

I've spotted that there is a three year time limit to file an amended tax return.

More as I find it.
 
G

guest

inflorescence said:
Sec. 280E. Expenditures in connection with the illegal sale of drugs

No deduction or credit shall be allowed for any amount paid or
incurred during the taxable year in carrying on any trade or
business if such trade or business (or the activities which
comprise such trade or business) consists of trafficking in
controlled substances (within the meaning of schedule I and II of
the Controlled Substances Act) which is prohibited by Federal law
or the law of any State in which such trade or business is
conducted.
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There is a serious probability that marijuana has been improperly placed as a schedule 1 substance since 1996.

If this attempt to correct the situation works, then the above part of the tax code does not apply. And has not applied since 1996.

As there is ongoing action to rectify this fraud committed against the marijuana community, I propose that it is reasonable to to claim the deductions and carry forward the resulting increase in tax return until the issue has been resolved.

Thread on this current attempt: http://www.icmag.com/ic/showthread.php?t=96878

If the current scheduling is found proper, then I can amend my tax return(s) to reflect the tax code listed above.

Since there is a three year time limit to claim deductions, I must apply for these deductions, that may be rightfully mine to claim, before the situation is entirely resolved. Otherwise I would lose deductions that may be rightfully mine by not filing for them in time.

I propose to leave the funds with the IRS to try to avoid the possibility of a fraud charge until the issue is resolved.

Comments? inflorescence?
 
G

guest

For section 280e to apply, marijuana has to be a schedule 1 or 2 drug.

Marijuana has not been lawfully scheduled in the United States since 1996.

Stay tuned.

While waiting please do this:

Picture, in your own mind, that marijuana is already legal.
 
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G

guest

Oh Hoooo!!

Rev Carl hadn't heard of 280E yet :)

This could get real good real fast!
 
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