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62 votes
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Why doesn't everyone in UK just pay with exempted gifts?

In short, because the government is not required to honor your characterization of the transaction. A gift is something given without receiving anything in exchange. In almost all taxable contexts ...
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  • 129k
50 votes
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How does the mandate to report income from illegal activities in the US jibe with the Fifth Amendment?

The original 1913 Revenue Act only required the reporting of income from "lawful" sources. In the 1921 Revenue Act the word, "lawful" was removed requiring all income to be reported. [IRS Publication ...
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  • 5,426
47 votes
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If you are a lawyer of a thief, drug dealer, or human trafficker, what would you tell your client to tell IRS?

NAL, but I used to work for the IRS. GS-0592-08, AUSC W/I CSCI (for non-feds, that means General Sector, series 0592 grade 8, Tax Examiner, Austin Service Center, Division -> Wage & Investment, ...
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34 votes
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Can one avoid paying US income tax by being paid in Bitcoin?

No. You have to pay taxes no matter what currency you are paid in, or for that matter, in most barter transaction as well. You would have to pay taxes even if you were paid in goats. Also, the ...
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  • 129k
32 votes
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Can you avoid capital gains tax by taking out a loan and not repaying debt?

Yes, you can borrow tax-free Bitcoin (or really, any currency not your home currency) is a security like a stock or bond. Whenever you take a loan using a security as collateral, that is not a taxable ...
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25 votes
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Can U.S. Tax Forms Be Legally HTMLified?

There are no copyright restrictions, since tax forms are government works and statutorily not protected. The IRS in fact says that you can use a substantially identical form for W9, as long as you don'...
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  • 156k
24 votes

Is this story about US tax office reasonable?

There is no general law making it illegal to lie about debts, or anything else. It is illegal to lie to a law enforcement officer in the course of an investigation. (And of course it is illegal to lie ...
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  • 89.1k
24 votes
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Is there really a German law that requires that credit card companies *only* provide statements in read-only format?

The laws you are looking for are §§144 ff Abgabeordnung (AO) and are for those who are required by law (earnings greater € 500000) to retain their bank statements and wish to do so in an electronic ...
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  • 3,188
24 votes
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Friend using my address for tax return

If a friend uses my home address for his tax return, and he owes the IRS tons of money, will I be liable in any way? Assuming that this is an income tax or sale tax return, rather than a property tax ...
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  • 129k
23 votes
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Why is PayPal blocking my account according to U.S. tax law, if I've a UK account only?

The reason that you are being asked to comply with a US law is because PayPal, a US company, is required to comply with US laws. If you do not comply, it is likely that they will be non-compliant and ...
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  • 11.6k
22 votes

If you are a lawyer of a thief, drug dealer, or human trafficker, what would you tell your client to tell IRS?

The most recent Supreme Court Rulings on the matter is that of Garner v. United States in tandem with United States v. Sullivan. Sullivan ruled that the 5th amendment does not permit a tax payer from ...
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  • 16.2k
20 votes
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At what salary do I need to withhold taxes?

A babysitter is a household employee in the IRS's parlance. This means that: [Y]ou may need to withhold and pay social security and Medicare taxes, pay federal unemployment tax, or both. To find out,...
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18 votes

As a US citizen, what law requires me to pay income tax?

The Internal Revenue Code found at Title 26 of the United States Code. Title 26 is the full compilation of all the laws passed by Congress relating to tax liability and every other legal obligation, ...
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  • 10.9k
14 votes

Does the right against self incrimination mean you can't be forced to file a tax return?

Since you asked, and it's a perfectly legitimate question, here's why it doesn't violate the Fifth Amendment (from Garner v. US): The Fifth Amendment doesn't say "you can't be made to say anything ...
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  • 20.2k
14 votes
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How do US municipalities get their authority to govern?

A common phrase regarding US cities is, "cities are creatures of the state." All of their authority comes from the authority granted states, and states can limit the authority of cities, counties and ...
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  • 256
14 votes

Why doesn't everyone in UK just pay with exempted gifts?

Why doesn't everyone in UK just pay with exempted gifts? Very short answer to complement ohwilleke's one: Gifts cannot be paid with. If you are paying with something it is a payment, not a gift.
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  • 19.8k
14 votes

How can the the USA legally ask illegal immigrants to pay taxes while denying them any legal basis of citizenship?

Paying taxes need not have any legal connection to citizenship or potential citizenship. There is no constitutional provision, or law, which limits taxation to citizens or those on a path to ...
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  • 89.1k
14 votes

Does the federal government have authority to impose tax laws at the state level?

They aren't "imposing tax laws at the state level", and the states are still perfectly free to award whatever credits they like. There's a more complete explanation here. Before 2017, if you paid, ...
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14 votes
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Tax Implication of COVID-19 Induced Remote Employment

You will probably not be able to take a tax deduction for this. The IRS requires that the space that you use for your home office is that the portion of your house is exclusively and regularly used ...
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  • 9,065
13 votes
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Making Money and not filing an Income Tax Return

It isn't "illegal" but there are negative consequences to doing so. The civil penalties for failure to file a tax return are a percentage of the tax not paid (5% per month up to a maximum ...
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  • 129k
11 votes

Is income tax due when the work is done, or when it is paid?

It depends on whether your tax accounting is on an accrual basis or cash basis. The UK government (at least) refers to the former as traditional accounting. In that method of accounting, whatever it'...
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  • 24.6k
11 votes
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When did U.S. tax code limit the personal Capital Loss Deduction to $3000?

The Internal Revenue Code of 1954, all 1024 pages of it, was enacted in the course of a year, basically rebooting and rewriting the tax code, contains §1211 in in 68A Stat. 321: (b) OTHER ...
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  • 156k
10 votes

As a US citizen, what law requires me to pay income tax?

There are even laws against acting on the various claims that are advocated by tax protesters. Typically these are referred to as "frivolous tax arguments," and make for entertaining reading.
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  • 19.8k
10 votes

Is there any penalty for intentionally over-reporting income on your 1040?

26 USC 7206: Any person who— (1) Willfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties ...
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10 votes

Employer failed to report my income or pay taxes. Do I have any rights to file a lawsuit?

Summary If they didn't steal your withholding, it depends a great deal. But if your employer stole your withholding, the IRS will sue them on your behalf. You will absolutely have grounds to sue them,...
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10 votes

How does the mandate to report income from illegal activities in the US jibe with the Fifth Amendment?

On your tax forms there is a field for how much of you income for the filing year was gained from illegal sources. It pretty much is a check box and then write the dollar value amount and how much of ...
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  • 16.2k
10 votes

How many years could Chauvin get for tax fraud?

Chauvin is being charged under Minn. Stat. § 289A.63, which makes filing a false return a felony. Criminal sentencing in Minnesota is generally done using a standard set of sentencing guidelines, ...
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  • 43.3k
10 votes
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Outside IR35 Public sector - Recruitment agency asking for NI Number on ltd company compliance form

Being outside of IR35 means one is considered a (self-employed) contractor, not an employee, and as such will not have income tax and national insurance contributions deducted under PAYE. HMRC require ...
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  • 20.5k
9 votes

Can you avoid capital gains tax by taking out a loan and not repaying debt?

This scheme merely defers the CGT. The gain occurs when the bitcoin is sold to pay off the debt, thereby realising its value for the original owner by cancelling the debt of $100k. At this point CGT ...
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