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Selling drugs? Stealing goods? Becoming your own Walter White in your basement? The IRS says you are required to report it for tax purposes.
With a brand new year, that starts the tax process in filing before the April deadlines. The IRS is now reminding people to grab the right forms to report any illegal activity that has provided income over the past year. According to IRS publication 17, Taxpayers must include “income from illegal activities, such as money from dealing illegal drugs....on their Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity."
If there's one thing I know criminals are serious about, it's reporting to the government all the money they made from Meth in 2021! What is happening?! Does anyone really report that?
Also in the publication, “if you steal property, you must report its fair market value, if you haven't returned it to its rightful owner in the same year.”
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One tax preparer told NBC News, “If you receive $500 to kill your neighbor’s annoying rooster, or find $1 on the street, or embezzle from your employer, that’s all taxable income, as well as your paycheck from flipping burgers at McDonald's.” Sure... I'll get right on that. They better tax that stupid racoon that killed my chicken then!
If you don't file your illegal stuff correctly, you could legit face prison time. The IRS law are nothing new. Gangster Al Capone was actually prosecuted for tax evasion when the state claimed his illegal activity was never reported and that his paperwork didn't reflect his life of riches.
So remind Terrance down the street, his weed sales need to be accounted for.
WAIT? If I have a stressful job then, can I write off the marijuana as medication then? So many questions.