Like prioritizing the needs of criminals over victims, the government doesn’t want to end crime; they want to profit from it…


Ever since the days of Al Capone and his conviction for tax evasion, I was under the impression that the proceeds of all criminal activity were taxable. So why is the Internal Revenue Service now making a pitch to the general public? Especially when it appears that billions of dollars are flowing through the economy from drug deals, bribes, stolen goods, prostitution, or other illegal activity such as government corruption, money laundering involving high-priced real estate, art, and other investments.

As a reminder, we want our share... 

From IRS Publication 17 (2021), Your Federal Income Tax -- for Individuals (For use in preparing 2021 Returns)

Illegal activities.

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.

Stolen property.

If you steal property, you must report its fair market value in your income in the year you steal it unless you return it to its rightful owner in the same year.


If you receive a bribe, include it in your income.


You must include kickbacks, side commissions, push money, or similar payments you receive in your income on Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity.

Above the law…

As we have seen over the past eight years, it appears that there is a two-tier legal system in play. A system where billions of dollars of taxpayer money, some of it purpose-printed, disappeared in Iraq, Afghanistan, and other corrupt countries – much of it in the form of palletized one-hundred-dollar bills. And virtually no one has been held accountable.

And then we see billions filtering through government contractors and non-governmental organizations whose accounting systems seem defective by design. Who is tracking the money flowing through our educational system? Where is the sister organization to the Internal Revenue Service to track government waste, fraud, and abuse? And don’t tell me it is the GAO (Government Accountability Office because they produce reports, not public employee accountability.


Do organized crime families now have to W-2 the organization’s soldiers, or 1099 them as independent contractors? Are expenses incurred in generating illicit income tax deductible? Are gold chains, fast cars, and weapons deductible as tools of the trade? Is a hitman an independent contractor? What about multi-national crime syndicates domiciled in foreign countries? Are they to be treated as those multi-billion-dollar corporations that pay little or no taxes? Do snitches and confidential informants have to pay taxes on the government’s payments?

What about members of Congress profiting from insider information? If you hold stolen money or goods for more than six months, is it taxed at capital gains rates, or is it ordinary income for the purposes of taxation? 

Bottom line…

Our tax code, written for insiders, lawyers, accountants, and lobbyists, is in desperate need of reform and simplification. More importantly, we need to reduce taxes and simultaneously reduce government spending on frivolous non-prioritized necessities. We need to reduce government waste, fraud, and abuse. We need to re-think corporate taxation. And reduce the number of self-serving laws created for those who can pay tax attorneys and others to tease out loopholes in the system.

We are so screwed.

-- steve

“Nullius in verba.”-- take nobody's word for it!

“Beware of false knowledge; it is more dangerous than ignorance.”-- George Bernard Shaw

“Progressive, liberal, Socialist, Marxist, Democratic Socialist -- they are all COMMUNISTS.”

“The key to fighting the craziness of the progressives is to hold them responsible for their actions, not their intentions.” – OCS

"The object in life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane." -- Marcus Aurelius

“A people that elect corrupt politicians, imposters, thieves, and traitors are not victims... but accomplices” -- George Orwell

“Fere libenter homines id quod volunt credunt." (The people gladly believe what they wish to.) ~Julius Caesar

“Describing the problem is quite different from knowing the solution. Except in politics." ~ OCS