I have explored the idea that lawful money is not regarded as taxable income by the IRS in my own small way, via correspondence with the IRS, tax returns on "income" which was so low that the returns should have resulted in refunds no matter how one filed them, and other research and observation.
During the course of this experiment, I experienced the following:
Whenever I wrote letters to the IRS asking questions or making statements about LM, the IRS responded that it would not respond any further to my "frivolous correspondence".
The IRS does not seem to consider LM as anything other than taxable income, if an information return such as W-2 exists which states that a PERSON received so-called "wages or income", regardless of how the backs of paychecks had been endorsed or non-endorsed, and LM had been demanded.
I have a searchable text of the 1986 IRC, and I could not find the term "lawful money" in it.
The IRS doesn't seem to care about what men and women do with cash or FRNs on their own time, as long as this cash doesn't go through PERSONAL numbered bank accounts. Banking with numbered accounts involving SSN or TIN appears to be a "
trade or business with the United States".
DISCLAIMER:
I'm linking to the "trade or business scam" research at famguardian only for the discussion of the statutes and court cases which it offers, not for any ideas about remedy, which may or may not be contained therein.
I have observed that some restrictively endorsed (LM demanded) bank checks which were deposited in non-interest bearing accounts and on which no information returns had been filed with the IRS, were not considered "taxable income, gains, or wages" by the IRS.
CONCLUSION:
Based on my experiences, I concluded that the IRS regards amounts of dollar denominated fiat currency which a PERSON (FIRST M LAST, DOB, SSN) receives in the form of bank checks or direct deposits, and which are documented on information returns, such as W-2 or 1099-MISC, as taxable income, regardless of how the checks are non-/endorsed or the bank signature card is signed.
Originally Posted by Treefarmer
I have explored the idea that lawful money is not regarded as taxable income by the IRS in my own small way, via correspondence with the IRS, tax returns on "income" which was so low that the returns should have resulted in refunds no matter how one filed them, and other research and observation.
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