§61 — Gross income defined

9 [*9] overruling in part 147 T.C.

to enter 8(...continued) opinion designated as a precedent opinion is binding on Department officials and employees in subsequent matters involving a legal issue decided in the precedent opinion, unless there has been a material change in a controlling statute or regulation or the opinion has been overruled or modified by a subsequent precedent opinion or judicial decision.

In a per curiam opinion, the Court of Appeals for the 11th Circuit affirmed our decision based on the binding Cotnam precedent and declined to consider the Commissioner’s argument that Cotnam was wrongly decided, noting that Cotnam can be overruled only by the court sitting en banc.

Treasury Regulation § 1.721-1(b)(1) states in part: To the extent that any of the partners gives up any part of his right to be repaid his contributions (as distinguished from a share in partnership profits) in favor of another partner as compensation for services (or in satisfaction of an obligation), section 721 does not apply. The value of an interest in such partnership capital so transferred to a partner as compensation for services constitutes income to the partner under section 61.

Unlike a payment representing a return of capital, the payments are not tied to the financial success of the partnership.35 Like a salary, guaranteed payments are ordinary income to the partners and deductible to the partnership under section 162 or 263, as appropriate.36 The Hohls and the Blakes argue that because guaranteed payments are not considered part of a partner’s distributive share only for purposes of section 61(a) and section 162(a), they are considered as “distributive shares of par

Unlike a payment representing a return of capital, the payments are not tied to the financial success of the partnership.35 Like a salary, guaranteed payments are ordinary income to the partners and deductible to the partnership under section 162 or 263, as appropriate.36 The Hohls and the Blakes argue that because guaranteed payments are not considered part of a partner’s distributive share only for purposes of section 61(a) and section 162(a), they are considered as “distributive shares of par

63, as distinguished from "gross income", sec. 61.

These factual distinctions render Davis wholly inapposite.

61. Petitioners acted negligently under the circumstances. Because ofsection 1.6662-2(c), Income Tax Regs., we need not address the applicability ofthe penalty on the ground ofsubstantial understatement ofincome tax for 2008. The accuracy-relatedpenalty does not apply with respect to any portion of the underpayment for which it is shown that the taxpayer had reasonable cause and acted in good faith.

Nonrecognition ofgain or loss on contribution.-- * * ·* * * * * (b)(1)* * * To the extent that any ofthe partners gives up any part ofhis rightto be repaid his contributions (as distinguished from a share in partnership profits) in favor ofanother partner as compensation for services * * * section 721 does not apply. The value ofan interest in such partnership capital so transferred to a partner as compensation for services constitutes income to the partner under section 61.

We rejected the taxpayers' reasoning and distinguished Nathel from Gitlitz, noting that contributions to the capital ofan S corporation are not listed in section 61 as items ofgross income.

278, 285- 286 (1960), the Supreme Court said: 2 We need not decide which party bears the burden of proof because we decide this case on the basis of the preponderance of evidence without regard to the burden of proof.

9 We disagree with petitioner’s arguments.

We disagree with respondent that the asset transfer resulted in gross income to the Caracci children.

Accordingly, we hold that there was not a substantial risk of forfeiture of the disputed shares.

We hold that the Kelleys lack reasonable cause for their careless disregard of the foundational rules of section 61 (regardless of the Commissioner’s burden of proof on this issue), and they are liable for the negligence/disregard penalty.

Gross Income Section 61 provides that gross income from whatever source derived is subject to federal income taxation.

Taxability ofDistributions to Tribal Members Section 61 provides that "gross income means all income from whatever source derived" unless an exception is provided.

Taxability ofDistributions to Tribal Members Section 61 provides that "gross income means all income from whatever source derived" unless an exception is provided.

The gross income ofthe upper tier CFC partners is calculated pursuant to section 61.

Wages Section 61 provides: "[G]ross income means all income from whatever source derived".

The Notice In the "Explanation ofItems" portion ofthe notice, respondent first states: "The portion ofthe payments [contributions to the Advantage Plan] * * * used to pay the cost ofproviding life insurance * * * [for 2003] is includible in your income pursuant to Section 61 * * * and Treasury Regulation section 1.61- 2(d)(2)(ii)." In addition, respondent states: "The portion ofthe payments in excess ofthe amount * * * used to pay the cost ofproviding life insurance protection for you for * * *

Therefore, we hold that petitioner is not entitled to the deductions he claimed for 2008, because he failed to carry his burden ofproving that respondent's determinations are incorrect.

Section 61 provides that "gross income means all income from whatever source derived".

Section 61 provides, in part, that gross income means all income from whatever source derived including (but not limited to) compensation for services and gains derived from dealings in property and royalties.

Section 61 provides "gross income means all income from whatever source derived".

Section 61 provides that gross income includes all income from whatever source derived and, in section 61(a)(2), specifically lists gross income derived from business.

The Jury Award Section 61 provides that, in general, "gross income means all income from whatever source derived" and includes all accretions to the taxpayer's wealth.

sues for decision, relating to petitioner's 2008 Federal income tax return, are whetherpetitioner is liable for a section 72(t)(1) SERVED AER 3 0 2012 - 2 - 10% additional tax relating to distributions from a qualified retirement plan and whether interest is includible in petitioner's gross income pursuant to section 61.1 FINDINGS OF FACT In 2008 petitioner, at age 49, received a retirement distribution of$42,853 (distribution) frod a qualified retirement plan and $18 ofinterest income.

After subtracting $12,455.54 for 2004 and $27,882 for 2005 to reflect the parties' concessions as summarized in the findings offact, we decide whether petitionerhad unreported "additional income" for 2004 through 2007 of $47,303.46, $63,866, $56,119, and $64,143, respectively.9 We hold he did.

Section 61 provides that gross income includes all income from whatever source derived and, in section 61(a)(1), specifically lists compensation for services.

Section 61 provides that gross income includes all income from whatever source derived, unless the taxpayer can establish a - 4 - specific legislative authorization to exclude income from taxation.

Section 112 Section 61 provides that gross income includes all income from whatever source derived, unless the taxpayer can establish a specific legislative authorization to exclude income from taxation.

Gross Income Section 61 provides that "gross inco e means all income from whatever source derived".

Cbnclusion We hold that the $12, 500 payment from the City of Chicago is includable in Ms .

These two stipulations, however, do not constitute a concession that the reimbursements constitute gross income pursuant to section 61." "Petitioner argues that, while he "has never denied that he received expense reimbursements * * * for expenses that PACE paid or incurred on behalf of the District Sales Leaders", he never conceded that he had unreported gross income.

pursuant to section 61(a)(9) and .(11) ., Buckardt asserts that he'-does not have the burden of proof because the IRS did not provide evidence of .his alleged income .

We conclude that insofar as petitioner purchased the life insurance policy from the profit-sharing plan at a bargain price, the bargain element is includable in his gross income pursuant to section 61 .5 The amount, if any, of the bargain element depends upon the value properly assigned to the insurance policy .

Section 61 provides that gross income means all income from whatever source derived, including interest and dividends .

OPINION Section 61 provides that gross income is defined as "all income from whatever source derived" .

Discussion Taxability of Settlement Proceeds .Pursuant to section 61(a), gross income generally includes income from all .

Section 61 provides in part : " ( a) General Definition-- .

Discussion Section 61 provides that "gross income means all income fro m whatever source derived" .

Kimberlin Pursuant to section 61(a)(7), gross income includes dividends.

Gross income Section 61 provides that “gross income means all income from whatever source derived”.

Section 61 provides that gross income includes “all income from whatever source derived,” unless otherwise provided.

Section 61 provides that all income, from whatever source derived, is includable in gross income unless specifically excluded by another provision.

Section 61 provides that gross income generally includes all income from whatever source derived.

Discussion Section 61 provides that “gross income means all income from whatever source derived”.

Section 61 provides that all income, from whatever source derived, is includable in gross income unless specifically excluded by another provision.

Discussion Section 61 provides that “gross income means all income from whatever source derived”.

Petitioners have stipulated that “No portion of the settlement proceeds was paid to petitioner-husband on account of personal physical injuries or physical sickness.” Discussion Section 61 provides that “gross income means all income from whatever source derived”.

Petitioners excluded $10,170, representing the amount petitioner received from the County of Los Angeles for unused vacation and sick leave.4 Section 61 provides in part: SEC.

Discussion Section 61 provides that all income from whatever source derived is included in gross income, except as otherwise provided.

Discussion Section 61 provides for the inclusion in gross income of all income from whatever source derived, except as otherwise provided.

- 5 - Section 61 provides that gross income includes "all income from whatever source derived," unless otherwise provided.

- 5 - Section 61 provides that gross income includes "all income from whatever source derived," unless otherwise provided.

Section 61 provides that gross income includes "all income from whatever source derived," unless otherwise provided.

Discussion Section 61 provides that all income, from whatever source derived, is includable in gross income unless specifically excluded by another provision.

- 6 - Discussion Section 61 provides that all income, from whatever source derived, is includable in gross income unless specifically excluded by another provision.

Section 61 provides that gross income includes "all income from whatever source derived," unless otherwise provided.

Even on the assumption that section 274 applies, if we hold that subsection 274(e)(2) removes petitioner’s deduction from the reach of section 274, then - 9 - petitioner prevails.3 Accordingly, we first address the parties’ arguments that focus on section 274(e)(2); i.e., whether it acts as an exception or a limitation.

In the same year, MAI realized discharge of indebtedness income, pursuant to section 61(a)(12), in the amount of $2,030,568 as a result of the disposition and a related agreement between MAI and its creditors.3 In turn, the COD income of $2,030,568 exceeded MAI's losses by $1,375,790 in 1991.

Commissioner, 66 T.C.M (CCH) at 1735- 1736, observed that in Procter & Gamble the Tax Court “took the holding of First Security and applied it in the context of a foreign--as opposed to a domestic Federal or State--law.” The Tax Court in Exxon next addressed respondent’s reliance on section 61 of the Internal Revenue Code of 1954 for his theory that income in question should be allocated to Texaco’s U.S. subsidiary. Exxon Corp. v. Commissioner, 66 T.C.M. (CCH) at 1738-1739. Under the section 61

spondent instead argues that the amounts Dr. Filler received are taxable as ordinary income because sec. 1235 does not apply and the incorporation agreement described Dr. Filler’s remuneration as royalties, which are taxable as ordinary income under sec. 61. As discussed supra note 15, respondent also improperly relies on a post-TCJA version of sec. 1221 to support his position. -43- [*43] same meaning under section 1402(a), defining “net earnings from self-employment,” as under section 162. Sec

Rather, the corroborating evidence provided at trial often shows a clear mixture ofpersonal and business expenses claimed as business - 41 - [*41] deductions; and petitioners made no efforts to distinguish business from personal expenses. V. PPI A. Gross Receipts 1. Bank deposits In addition to the bank deposits analysis ofpetitioners' personal bank account (see part III above), the IRS also performed a bank deposits analysis to determine the gross receipts ofPPI for 2004. Generally, unless oth

We rejected the taxpayers' reasoning and distinguished Nathel from Gitlitz, noting that contributions to the capital ofan S corporation are not listed in section 61 as items ofgross income.

We rejected the taxpayers' reasoning and distinguished Nathel from Gitlitz, noting that contributions to the capital ofan S corporation are not listed in section 61 as items ofgross income.

We rejected the taxpayers' reasoning and distinguished Nathel from Gitlitz, noting that contributions to the capital ofan S corporation are not listed in section 61 as items ofgross income.

We rejected the taxpayers' reasoning and distinguished Nathel from Gitlitz, noting that contributions to the capital ofan S corporation are not listed in section 61 as items ofgross income.

[Brody, et al., supra, at A-119-A-120.] Section 61 provides that gross inc me includes all income from whatever source derived. Commissionerv. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). Generally, an employee who receives an economic benefit under an arrangement with an employer must include in gross i come the value ofthe benefit i.eceived. Commissioner v. Smith, 324 U.S. 177, 1 1 (1945). Under section 1.61-2(d), Income Tax Regs., premiums paid by an employer for life insurance on the life o

[Brody, et al., supra, at A-119-A-120.] Section 61 provides that gross inc me includes all income from whatever source derived.

itioner Must Include the Cost of the Life Ínsurance Protection iå His Gross Income Respondent contends thÅt the cost of life insurance proteòtion Keady provided to petitioner during 2004 was an economic benefit and, therefore, should be included in -his gross income under section 402 (b) or section 61. Petitioner contends that neither section is applicable . We agree with respondent that dhe value of the cost of life insurance protection is included in petitioner' s gross income under section 61

Thus, in accordance with Regulation Section 1.83-l(a)(2), employees should be taxed each year on the cost of the life insurance protection under Code Section 61 and the Regulations thereunder in an amount which is equal to the reasonable net premium cost as determined by the Commissioner of the current life insurance protection as defined in Regulation Section 1.72-16(b)(3) provided by such contract.

teriality we must know which item to address, interest or late- fee income . Petitioners contend that the references to "item" throughout section 1 .446-1(e), Income Tax Regs ., mean an "item of income or deduction" . "Items of income" are listed in section 61 . Under petitioners' theory, because item means item of income, under Gitlitz v . Commissioner, 531 U.S . 206 (2001), the Court must look to section 61 to determine what an item is . Petitioners give the Supreme Court's holding in Gitlitz

Unlike income from discharge of indebtedness, contributions to the capital of an S corporation are not listed in section 61 as an item of gross income .

Unlike income from discharge of indebtedness, contributions to the capital of an S corporation are not listed in section 61 as an item of gross income .

nal Revenue Service (irs) on an IRS Form 1099-misc. Discussion I. Introduction The starting point in determining a taxpayer’s Federal income tax liability for any taxable year is the computation of gross income. The term “gross income” is defined in section 61. Compensation for services is includable in gross income unless excluded by law. See sec. 61(a)(1); sec. 1.61-2(a)(l), Income Tax Regs. The parties have stipulated (and we have found accordingly) that, during 2000, petitioner received $16,

In support of his argument, petitioner cites four Tax Court cases.22 In each cited case, the taxpayer was seeking an exclusion from gross income under section 61 for either lodging or meals provided by his employer pursuant to section 119.

But if section 105(a) does not apply, then the exclusion under section 105(c) does not apply, and the payments are included in income under section 61, unless specifically excluded by another section.

Section 61 specifically provides that gross income includes "pensions". Sec. 61(a)(11). Section 104(a)(4) excludes from gross income: amounts received as a pension, annuity, or similar allowance for personal injuries or sickness resulting from active service in the armed forces * * * Geodetic Survey or the Public Health Service, or as a disability

Income is taxed to the individual who earns it; the incidence of taxation cannot be shifted by an anticipatory arrangement. Lucas v. Earl, 281 U.S. 111, 114-115 (1930). We do not recognize petitioner's transfer to Dogwood Acres for Federal income tax purposes. Moline Properties, Inc. v. Commissioner, 319 U.S. 436, 439 (1943); Kimbrell v. C

to the Caracci children who, in turn, contributed those assets to the Sta-Home for-profit entities. Respondent argues in brief that the constructive transfer is an accession to wealth that is includable in the Caracci children’s gross income under section 61. We disagree with respondent that the asset transfer resulted in gross income to the Caracci children. Although section 61 provides broadly that gross income includes all income “from whatever source derived”, section 102(a) generally exemp

to the Caracci children who, in turn, contributed those assets to the Sta-Home for-profit entities. Respondent argues in brief that the constructive transfer is an accession to wealth that is includable in the Caracci children’s gross income under section 61. We disagree with respondent that the asset transfer resulted in gross income to the Caracci children. Although section 61 provides broadly that gross income includes all income “from whatever source derived”, section 102(a) generally exemp

to the Caracci children who, in turn, contributed those assets to the Sta-Home for-profit entities. Respondent argues in brief that the constructive transfer is an accession to wealth that is includable in the Caracci children’s gross income under section 61. We disagree with respondent that the asset transfer resulted in gross income to the Caracci children. Although section 61 provides broadly that gross income includes all income “from whatever source derived”, section 102(a) generally exemp

to the Caracci children who, in turn, contributed those assets to the Sta-Home for-profit entities. Respondent argues in brief that the constructive transfer is an accession to wealth that is includable in the Caracci children’s gross income under section 61. We disagree with respondent that the asset transfer resulted in gross income to the Caracci children. Although section 61 provides broadly that gross income includes all income “from whatever source derived”, section 102(a) generally exemp

With regard to the definition of income, section 61 expressly states that gross income constitutes “all income” and expressly lists as one of the categories of income “compensation for services” rendered by the taxpayer, which certainly would include Gary’s wages as a salesman and any fee income Fran received for computer consulting.

wer). In the 2015 Answer respondent substantially modified his position from the 2015 Notice and alleged the $155,000 adjustment to petitioner’s Schedule C gross receipts set forth in the 2015 Notice should have been classified as other income under section 61. Respondent now alleges that petitioner did not operate a business for feeding prisoners in 2015 and that the $155,000 constituted proceeds from embezzlement. Accordingly, respondent now contends that petitioner is not entitled to the NOL

The Court restated the standard under section 61 that gross income includes “all income from whatever source derived” and that it includes “all ‘accessions to wealth .

First, section 105(a) provides a more specific rule than the general income inclusion rule under section 61 for when amounts received by an employee through accident or health insurance for personal injuries or sickness are excludable from income.5 If a disability payment under a disability insurance policy is not attributable to contributions by an employer or paid by the employer and the payment 5 The Court assumes, without deciding, that th

g to do with income. Distributions are capital that owners remove from their corporations, see Rogers v. Commissioner, 102 T.C.M. (CCH) 536, 538 (2011), aff’d, 728 F.3d 673 (7th Cir. 2013), while income is, among other things, gains and profits, see sec. 61. An S corporation shareholder may pay tax on her corporation’s earnings, keep the money in the corporation till a later year, and then pay it to herself--that’d be a distribution. But in the year the corporation earns that income, its owner m

in the meaning of section 1372. Our Country Home Enters., Inc., 145 T.C. at 51; see Hurst, 124 T.C. at 35. Those economic benefits are thus taxed to petitioner husband as “guaranteed payments” under section 707(c) and hence as ordinary income under section 61. Petitioners invite us to reconsider our ruling in Our Country Home Enter- prises, 145 T.C. at 51, that split-dollar life insurance benefits are “fringe benefits” for purposes of section 1372. Petitioners note (correctly) that the term “fri

, 58 T.C. 757 (1972) (cash equivalents have basis equal to face value). As a result, the Reward Dollars paid to petitioners as statement credits for the charges relating to cash equivalents are an accession to wealth and income to petitioners under I.R.C. § 61. Petitioners’ position is as follows: The IRS [Internal Revenue Service] proposes to tax Mr. Anikeev’s rewards points because he did not earn them by acquiring goods or services. The IRS’ position is: “rewards generated where no goods or s

First, section 105(a) provides a more specific rule than the general income inclusion rule under section 61 for when amounts received by an employee through an accident or health - 10 - insurance plan will be included in gross income.5 Ifa payment meets the requirements ofsection 105(a) and, therefore, is includable in gross income, a taxpayermay be able to exclude it from gross income ifthe requirements of section 105(c) are met.

According to petitioner's memorandum, section 61 does not require his compensation to be included in gross income because that section is found in part I ofsubchapter B of subtitle A ofthe Code, entitled "Computation ofTaxable Income", and is subject to the next part, part II ofsubchapter B, entitled "Items Specifically Included in Gross Income", which sets out items specifically inclu

61; see, e.g., Du Poux v. Commissioner, T.C. Memo. 1994-448 (failure to receive a Form 1099-MISC does not convert taxable income into nontaxable income); Vaughn v. Commissioner, T.C. Memo. 1992-317 (same), aff'd without published opinion, 15 F.3d 1095 (9th Cir. 1993) At trial respondent also moved under Rule 41(b) to amend his answer to confor

We held that the excess portion ofan EZ Investment Credit or an EZ Wage Credit that may be refunded is an accession to wealth and must be included in a taxpayer's Federal gross income under section 61 for the year in which the taxpayer receives the payment or is entitled to receive the payment. E at 136. Petitioners' arguments that the EZ Investment Credits and the EZ Wage Credits are not taxable income are without merit in the light ofour holding in Maines. Petitioners' contention that Maines m

Therefore, "any interest, divi- -51- dends and other income received by the custodian on securities and other assets held in the custodial accounts are includible in the gross income ofthe policyholder under section 61 * * * for the year in which they are received by the custodian." Id.

Section 61 is meant to extend to the full measure ofCongress's taxing power, and we have to construe exclusions from inc me narrowly. Commissioner v. Schleier, 515 U.S. 323, 327-28 (1995) (citing United States v. Burke, 504 U.S. 229, 248 (1992) (Souter, J., concurring)). Receipt oftax deductions or credits thatjust.reduce the amount oftax a taxpaye

We reasoned that "moneys paid to any taxpayer as compensation for an advance waiver ofpossible future damages for personal injuries, would constitute taxable income to him under section 61 ofthe 1954 Code; and would not be excludable from his gross income under section 104(a)(2) ofsaid Code." E at 87 (emphasis added).

All ofthat income was gross income under section 61 and taxable income under section 63, and the amounts far exceeded the levels requiring a return under sections 1(d), 6011(a), and 6012(a).

Section 61 is meant to extend to the full measure of Congress’s taxing power, and we have to construe exclusions from income narrowly. Commissioner v. Schleier, 515 U.S. 323, 327-28 (1995) (citing United States v. Burke, 504 U.S. 229, 248 (1992) (Souter, J., concurring)). Receipt of tax deductions or credits that just reduce the amount of tax a tax

Participating partners argue that the transfer is properly characterized as a capital contribution and is therefore excludible from GHP's income. Both respondent's argument and participating partners' argument assume that WAHD made the transfer or payment ofthe $3,088,000 amount from the deferred developer fees fund to GHP. We find that -

Because self-employment income and capital gains must be included in petitioner's income under section 61, we sustain respondent's determination with respect to the increased deficiencies as modified by concessions.

- 6 - At trial petitioner argued that section 61 allowed for the exclusion ofboth items.

he imposition ofan income tax, including: (1) there can be no deficiency unless a return was filed; (2) the Commissioner has no authorityto assess an estimatedtax unless it is a tax payable by stamp; (3) only corporate entities can have income under sec. 61; (4) respondent is not legally authorized to prepare a substitute for return; (5) real estate rents are not subject to the income tax authorized by the Sixteenth - Amendment; and (6) no U.S. citizen is statutorily liable for an income tax. Pe

ifts or donations as petitioners contend--theyrepresented a quid pro quo exchange; i.e., the payors were receiving petitioners' services in consideration for their payments. Accordingly, the deposits are includible in petitioners' gross income under section 61. "(...continued) Gardner identified some deposits at trial that he claimed were cash advances. He testified that he had "different credit card limits on different credit cards" and was able to secure such large cash advances by transferrin

Section 61 provides that gross income includes all income from whatever source derived and, in section 61(a)(2), specifically lists gross income derived from business. As a general rule, items ofgross income must be included in the gross income ofa cash method taxpayer for the year in which the taxpayer actually or constructively received the incom

The Supreme Court has defined gross in ome under section 61 "to encompass all 'accessions to wealth, clearly realized, and over which the taxpayers have complete dominion.'" James, 366 U.S.

We similarly find none; and in the absence ofcongressional intent we note that we have strictly construed section 104(a)(1) to conform to the general purview of section 61, that all income is taxable unless explicitly excluded.

The Supreme Court has defined gross in ome under section 61 "to encompass all 'accessions to wealth, clearly realized, and over which the taxpayers have complete dominion.'" James, 366 U.S.

Section 61 (a) generally inc Ludes in gross income "all income from whatever source derived" un ess excluded by a specific provision of the Code. Compensation for services is specifically included in the definition of gross income. Sec. 61(a) (1). Petitioners presented.no credible evidence that Mr. Norwood did not receive the amounts of income resp

- 8 - and 2007 are compensation.for services contemplated by section 61 and taxable to him as income.

Tjnreported Nonemployee C >mpensation a i Section 61 defines gross income as ."allsincome from whatever source derived" and includes compensation paid for ¯services, whether furnishec -bysthe taxpayer as an employee or as a self- emplo ed person cr independen contractor.

Interest Income Section 61 defines gross income broadly as "all income from whatever source derived, " which includes interest income.

operty) to a plan participant or beneficiary before August 29, 2005, the excess of the fair market value of the contract over the value of the consideration received by the trust is includable in the participant’s or beneficiary’s gross income under section 61, but the transfer “is not treated as a distribution for purposes of applying the requirements of subchapter D of chapter 1 of subtitle A of the Internal Revenue Code”, which contains sections 401 through 424.

Thus,, in accordance with section 61, the $500,000 payment must be included in petitioner's gross income for the 2004 taxable year .

Section 61 provides that gross income means all income from whatever source derived, including interest and dividends . All of the income in the three accounts, asid e from the principal amounts deposited, consists of interest or dividends . Additionally, we note that Mr . Bell stressed to Mr . Reiserer that the speed at which the offshore money wa

Section 61 Section 61 ( a) defines gross income as all income from whatever source derived . A. Income From Akron Public Schools Gross income includes compensation for services . Sec . 61(a)(1) . In 2002, 2003 , and 2004 petitioner earned wages of $67,691, $66,542, and $69,107 , respectively, from the Akron Public Schools . B. Interest Income Gross

Respondent's determination of a deficiency in petitioners' Federal income tax for the taxable year 2004 was attributable to petitioners' failure to report the discharge of indebtedness income .' OPINION Section 61 generally defines gross income as "all incom e from whatever source derived" .

Taxpayers are required, under section 61 ( a), to include in gross income " all income from whatever source derived" unless such income has been specifically excepted from inclusion .

2007 ) .3 The Court of Appeals held that for the flush language of section 104(a) to make sense, the definition of gross income in section 61 (a) must first include damages for nonphysical emotional distress injuries .

hat petitioners did not cooperate with such reasonable requests by respondent during the course of the audit . We hold that petitioners bear the burden of proof . B. Uhreported .Income Grioss income includes 11 income from whatever source derived, sec. 61 (a), and taxpayers are; required to keep books and records sufficient to establish their iFederal income tax liability, see sec. 6001; see also sec. 1 .6001- 1(b), Income Tax Regs . Where taxpayers have not maintained adequate business . record

1.1001-1(a), Income Tax Regs. The fair market value of property is a question of fact and only in rare and extraordinary cases will property be considered to have no fair market value. Schulman v. Commissioner, 93 T.C. 623, 638 (1989); sec. 1.1001- 1(a), Income Tax Regs. Respondent’s expert testified that the warrants for Ciena stock

Second, respondent determined that each doctor received income under section 61 (a) in the amount of the life insurance premiums that were paid by his S corporation on his behalf .

Section 61 specifically lists pension income as incl dable in a taxpayer's gross income . Sec . 61 (a) (11) . Pr ceeds from stock sales are likewise includable in a taxpayer's g oss income . Thus, the distribution of $42,15 4 that petitione received from the Colorado Public Employees Retirement Ass ciation and the $24 in stock proceeds received by

OPINION Section 61 provides that "gross income means all income from whatever source derived ." Gross income is an inclusive term with broad scope, designed by Congress to "exert * * * `the full measure of its taxing power"' .

Petitioner’s argument that his compensation and retirement payments constituted a nontaxable return of human capital is directly refuted by the requirement, under section 61, to include those amounts in gross income and by numerous cases affirming the intent of that section to reach any and all income from whatever source derived unless specifically exempted.

1.1001-l(a), Income Tax Regs. The fair market value of property is a question of fact and only in rare and extraordinary cases will property be considered to have no fair market value. Schulman v. Commissioner, 93 T.C. 623, 638 (1989); sec. 1.1001-1(a), Income Tax Regs. Respondent’s expert testified that the warrants for Ciena stock h

The construction of section 61 is broad, and any “‘exclusions to income must be narrowly construed.’” Commissioner v.

The law is clear that income from gambling is includable in gross income under section 61.3 Moreover, gambling losses are deductible only to the extent of the taxpayer’s winnings from similar transactions.

The Sixteenth Amendment has the effect of overriding the direct- tax-apportionment requirement with respect to "taxes on incomes, from whatever source derived".4 Section 61 provides as follows: Thus, the Sixteenth Amendment is properly a limited removal of a limited restriction on the Congress's broad power to tax income; the Sixteenth Amendment is not the source of the power to tax income.

The Sixteenth Amendment has the effect of overriding the direct- tax-apportionment requirement with respect to "taxes on incomes, from whatever source derived".4 Section 61 provides as follows: 4 Thus, the Sixteenth Amendment is properly a limited removal of a limited restriction on the Congress's broad power to tax income; the Sixteenth Amendment is not the source of the power to tax income.

The construction of section 61 is broad, and any “‘exclusions to income must be narrowly construed.’” Commissioner v.

Petitioner makes this argument despite having stipulated that he is required under section 61 to include in his gross income, royalties of $16,113 paid to him by Warner Chappell in 2000.

104(a)(2).4 Section 61, which mandates that gross income includes all income from whatever source derived absent a specific statutory exclusion, is to be broadly construed.

Thus, in accordance with section 61, the $12 million payment must be included in petitioners’ gross income for the 1995 taxable year.

For purposes of calculating taxable income, section 61 defines gross income as “all income from whatever source derived” unless otherwise specifically excluded.

Unreported Income Section 61 provides that income from whatever source derived, including compensation for services, must be included in gross income.

61; Commissioner v. Kowalski, 434 U.S. 77, 82-83 (1977); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 430 (1955). The Internal Revenue Code provides no exclusion from gross income for proceeds received by a relator in a qui tam proceeding. In Eisner v. Macomber, supra, the Supreme Court decided that a shareholder- taxpayer did not realize

Income From Kmart Section 61 defines gross income as all income from whatever source derived.

We consider whether the gross receipts were properly allocated by respondent and are taxable to petitioner under either the assignment of income doctrine and section 61 or under section 482, the regulations, and the case law thereunder.5 Gross income includes all income from whatever source derived.

Finally, section 61 defines gross income as “all income from whatever source derived”, unless otherwise provided.

Generally, unless otherwise provided, gross income under section 61 includes net accessions to wealth from whatever source derived.

Finally, section 61 defines gross income as “all income from whatever source derived”, unless otherwise provided.

Discussion In general, gross income is defined by section 61 as follows: SEC.

Section 61 provides that all income, from whatever source derived, is includable in gross income unless specifically excluded by another provision. Compensation for services is specifically included in the definition of gross income. Sec. 61(a)(1). Unemployment compensation is includable in gross income. Sec. 85(a). Petitioner has not stated any di

The sweep of section 61 is very broad.

OPINION Section 61 provides that all income, from whatever source derived, is includable in gross income unless specifically excluded by another provision.

Section 61 provides that gross income means all income from whatever source derived. Section 6001 imposes a duty on all persons liable for any tax to maintain records. It is well established that where a taxpayer fails to maintain adequate records, the Commissioner may prove the existence and amount of unreported income by any method that will clea

Neither section 911 nor section 861 operates to prevent section 61 from applying to petitioner’s receipts.

Tax Treatment of Payments Section 61 broadly defines gross income as "all income from whatever source derived".

x of $2,235. Section references are to the Internal Revenue Code in effect for the year in issue. - 2 - After concessions by petitioner,1 the issue is whether amounts received from two churches for playing an organ during services are taxable under section 61. Petitioner resided in Philadelphia, Pennsylvania, at the time the petition was filed. During 1997, petitioner received $8,177 from the Oak Grove Baptist Church (Oak Grove) and $3,437 from the Mt. Zion Baptist Church (Mt. Zion) for playing

Interest Income Under section 61, interest income is includable in income.

Interest Income Under section 61, interest income is includable in income.

nsion income during 1992, 1994, and 1995 in the respective amounts of $1,368, $6,102, and $3,693.2 Petitioner generally argues that no act of Congress authorizes taxation of these amounts. We disagree. All these amounts constitute gross income under section 61. Petitioner’s arguments to the contrary are wholly without merit and not worthy of further analysis. We hold that petitioner has deficiencies in income taxes in the amounts determined in the notice of deficiency. Respondent also determined

The issue is whether amounts petitioner Janet Mess (petitioner) received from her former husband's military retirement pension during 1996 are includable in gross income - 2 - under section 61.1 Petitioners resided in Talent, Oregon, at the time the petition was filed.

- 4 - OPINION Gross Income Under section 61, Congress defined gross income as all income from whatever source derived.

Income Section 61 provides that gross income includes all income from whatever source derived. Subsection (a)(1) specifically provides that compensation for services is included in income. See also Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 430 (1955); sec. 1.61-2, Income Tax Regs. Petitioner was a civilian employee of the Department of Defense and

Petitioner, in a typical tax protester argument, contends that the taxation of his income under section 61 and the taxation of his income under section 3101 constitute double taxation, which he claims is unconstitutional.

- 2 - The issue is whether wages and a pension distribution are taxable under section 61.1 Petitioner resided in Hickory, North Carolina, at the time the petition was filed.

nsion income during 1994, 1995, and 1996 in the respective amounts of $6,258, $6,420, and $6,591.2 Petitioner generally argues that no act of Congress authorizes taxation of these amounts. We disagree. All these amounts constitute gross income under section 61. Petitioner’s arguments to the contrary are wholly without merit and not worthy of further analysis. We hold that petitioner has deficiencies in income taxes in the amounts determined in the notice of deficiency. Respondent also determined

To the extent that his voluminous submissions are intelligible, he contends that he is not a taxpayer, that his income from sale of hospital supplies is not an item of income taxable under section 61, and that the regulations promulgated under section 61 provide that only foreign income is taxable.

nt includable as income by its employees. Respondent agrees that, but for section 274, petitioner’s claimed deduction would be allowable in full. In addition, respondent does not challenge petitioner’s fringe benefit income value calculations under section 61. Even on the assumption that section 274 applies, if we hold that subsection 274(e)(2) removes petitioner’s deduction from the reach of section 274, then petitioner prevails. Accordingly, we first address the parties’ arguments that focus o

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (-1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

bove $250,000. These concessions reduce the amount of the deduction at issue (continued...) - 3 - (1) Whether amounts collected by petitioner as "excess value charges" (EVC's)3 from its customers must be included in gross income in 1984 pursuant to section 61. We hold that EVC's must be included in petitioner's income.4 (2) Whether petitioner is entitled to deductions under section 162 for any amounts paid to National Union Fire Insurance Co. of Pittsburgh, Pennsylvania (NUF). We hold that petit

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

corporation's earnings and profits are reduced by, among other things, the amount of money distributed with respect to its stock. Earnings and profits for a particular period include tax-exempt income, as well as items included in gross income under section 61. Sec. 1.312-6, Income Tax Regs. We are required to make a finding as to whether AJF had sufficient earnings and profits to sustain a dividend. DiZenzo v. Commissioner, supra at 127 (remanding to the Tax Court - 2288 - to make a finding wit

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

earned income from landscaping services during the years in issue. Petitioners assigned the income they earned to Mountlake. Respondent determined that the income derived from landscaping services must be included in petitioners' income pursuant to section 61. Section 61(a) provides that, except as otherwise provided by law, gross income includes income from whatever source derived, including compensation for services. See sec. 61(a)(1). It is fundamental to our system of taxation that income m

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

Discussion Section 61 provides that "gross income means all income from whatever source derived, including (but not limited to) * * * Compensation for services." Petitioner's contention that he is - 4 - not subject to taxation and therefore not liable for income taxes is without merit.

Military pay received by members of the U.S. Armed Forces is generally includable in gross income. See sec. 1.61-2(a)(1), Income Tax Regs. Congress may specifically exempt certain items from inclusion in gross income. See Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 430 (1955). Certain military compensation, such as compensation recei

Section 61 provides that gross income means all income from whatever source derived, including interest income. Sec. 61(a)(4). Petitioner contends that although the bank accounts listed the names of both petitioners and their Social Security numbers, they were held by petitioners for the benefit of their children. The record does not show that peti

Section 61 provides that gross income includes all income from whatever source derived. Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). Income "constitutes taxable income when * * * [a taxpayer] has such control over it that, as a practical matter, * * * [the taxpayer] derives readily realizable economic value from it." Rutkin v. Unit

Section 61 requires that certain amounts be included in gross income. Section 61(a)(13) provides, in part, that gross income means all income from whatever source derived, including, inter alia, distributive shares of a partnership's gross income. Section 701 provides that a partnership is not liable for Federal income taxes; instead, persons carry

Section 61 provides that gross income includes all income from whatever source derived. Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). Income "constitutes taxable income when its recipient has such control over it that, as a practical matter, * * * [the recipient] derives readily realizable economic value from it." Rutkin v. United S

Section 61 requires that certain amounts be included in gross income. Section 61(a)(13) provides, in part, that gross income means all income from whatever source derived, including, inter alia, distributive shares of a partnership's gross income. Section 701 provides that a partnership is not liable for Federal income taxes; instead, persons carry

Generally, section 61 provides that gross income includes income from whatever source derived, including fringe benefits, gross 4In the notice of deficiency sent to ETCO, respondent also determined that ETCO's income must be increased by $713 in fiscal year 1990 due to the auto lease inclusion requirements.

Generally, section 61 provides that gross income includes income from whatever source derived, including fringe benefits, gross 4In the notice of deficiency sent to ETCO, respondent also determined that ETCO's income must be increased by $713 in fiscal year 1990 due to the auto lease inclusion requirements.

Section 61 requires that certain amounts be included in gross income. Section 61(a)(13) provides, in part, that gross income means all income from whatever source derived, including, inter alia, distributive shares of a partnership's gross income. Section 701 provides that a partnership is not liable for Federal income taxes; instead, persons carry

on their respective 1992 returns. Respondent timely issued notices of deficiency to petitioners. Among other adjustments, respondent determined that punitive damages and related interest were fully includable in petitioners' gross income pursuant to section 61. Petitioners have since conceded that their punitive damages, and related interest, are includable in gross income in the amounts determined by respondent. See O'Gilvie v. United States, 519 U.S. 79 (1996). Respondent also determined that

oil. Had there been no delay in payment, Kuwait would have simply paid Aminoil $83,000,000. The "inflation" factor, like the "interest" factor, was compensation for the delay in payment, and therefore, it is properly treated as ordinary income under section 61. C. Discussion 1. Introduction The parties agree that the disputed item was received pursuant to the award and that the intention of the tribunal governs as to whether the disputed item is disguised compensation for the concession or a pay

In order to characterize income as taxable under section 61 or excluded from taxation under section 104(a)(2), we must ascertain "in lieu of what were damages awarded" or paid.

Section 61 requires that certain amounts be included in gross income. Section 61(a)(13) provides, in part, that gross income means all income from whatever source derived, including, inter alia, distributive shares of a partnership's gross income. Section 701 provides that a partnership is not liable for Federal income taxes; instead, persons carry

Section 61 requires that certain amounts be included in income. Absent any exclusionary provision, items of income are included in gross income. Sec. 61(a). Section 61(a)(12) includes COD income in gross income. See also United States v. Kirby Lumber Co., 284 U.S. 1 (1931). Sections 101 through 135 exclude specific items of income from gross income

1982-129, in which we held that "whether or not wages can be characterized as the product of an exchange, they are still income within the Constitutional embrace." Despite this overwhelming body of law, petitioner asserts that section 83 provides the specific exclusion from gross income for compensation that section 61 requires.

cterization of the law is correct, his remedy lies with Congress. We are not at liberty to create exceptions to the Internal Revenue Code. See id. at 440. Thus, we conclude that the Army loan repayment constitutes gross income within the meaning of section 61. Petitioner also argues that the imposition of interest is inappropriate since he did not receive a Form W-2 reflecting the Army loan repayment and, therefore, had no way of knowing that the Army loan repayment constituted gross income. Gen

It is well established that gross income under section 61 includes income earned from illegal activity, such as the proceeds of embezzlement.

Section 61 provides, in part, that gross income means income derived from business and as compensation for services. Section 63(b) provides that, in the case of an individual who does not elect to itemize deductions, the term "taxable income" means adjusted gross income minus the standard deduction and the deduction for personal exemptions. Section

Discussion Unless specifically excluded, section 61 defines gross income to mean income from whatever source derived, including interest.

Gross income includes income realized in any form, whether money, property, or services. Sec. 1.61-1(a), Income Tax Regs. Thus, if the taxpayer performs services in exchange for another type of service or receipt of property, then the taxpayer must include in his/her income the fair market value of the services or property received. Sec. 1

In this regard, statutory exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 232, 115 S. Ct. 2159, 2163 (1995). Under section 104(a)(2), gross income does not include "the amount of any damages received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal

Petitioner's Tax Protester Arguments Petitioner submitted a pretrial memorandum in which he listed as issues for trial: (1) Whether section 61 applies to him; (2) whether he must file a Form 1040; (3) whether he is - 4 - required to pay tax; and (4) whether the substitute for return under section 6020(b) applies only to alcohol, tobacco, and firearm activities.

Section 61 provides that gross income includes "all income from whatever source derived," unless otherwise provided. The Supreme Court has consistently given this definition of gross income a liberal construction "in recognition of the intention of Congress to tax all gains except those specifically exempted." Commissioner v. Glenshaw Glass Co., 34

Section 61 requires that certain amounts be included in income, i.e., items of income. Specifically, section 61(a)(12) requires that income from discharge of indebtedness be included in gross income. Absent any exclusionary provision, items of - 7 - income are included in gross income. Sec. 61(a). Sections 101 through 135 exclude specific items of

Gross income, pursuant to section 61, means all income from whatever source derived and includes income realized in any form, whether in money, property, or services.

Accordingly, pursuant to section 61, petitioners must include this amount in income.

Section 61 provides that gross income means "all income from whatever source derived," including (but not limited to) "Compensation for services", "Gains derived from dealings in property", "Interest", "Dividends", and "Pensions". Petitioner's contention that he is not subject to taxation and therefore not liable for income taxes is without merit.

Section 61 defines gross income as all income from whatever source derived. Included within the definition of gross income is "compensation for services". Sec. 61(a)(1). During the taxable years 1989, 1990, and 1991, petitioner received taxable wages. Sec. 61. All of petitioner's arguments have been rejected repeatedly by the courts. There is no do

Section 61 provides that gross income includes "all income from whatever source derived" unless otherwise provided. Furthermore, a taxpayer is required to maintain records - 4 - sufficient to establish the amount of his or her income and deductions. Sec. 6001. The first issue is whether petitioner failed to report wage income of $1,179 from his em

We hold, pursuant to section 61, that the interest income on such accounts is taxable to petitioner.

Respondent has determined a deficiency in petitioner's income tax for 1991 on the ground that the military retirement payment of $10,107 received by petitioner in 1991 and omitted from her return is gross income under section 61 and should have been reported as income on such return.

Deficiencies in 1985, 1986, and 1987 Section 61 provides the general rule that gross income includes income from whatever source derived.

Section 61 provides in general that gross income means all income from whatever source derived. Sec. 61(a). Specifically, section 74(a) provides that gross income includes amounts received as prizes and awards. An exception to the provisions of section 74(a) is provided in section 74(b), which provides: Gross income does not include amounts receive

We hold, pursuant to section 61, that the interest income on such accounts is taxable to petitioner.

Deficiencies in 1985, 1986, and 1987 Section 61 provides the general rule that gross income includes income from whatever source derived.

the taxable year in issue. All Rule references are to the Tax Court Rules of Practice and Procedure. - 2 - 1991. The issue for decision is whether slot machine winnings received by petitioner Denis M. Lyszkowski constitute gross income pursuant to section 61. The facts in this case have been fully stipulated and are so found. The stipulated facts and attached exhibits are incorporated herein by this reference. At the time of filing the petition herein, petitioners resided at Doylestown, Pennsylv

, respondent adjusted petitioners' gross receipts by $63,847. After concessions by the parties, the amount in dispute has been reduced to $14,000. Petitioners - 16 - contend that the $14,000 is composed of two loans and as such is not taxable under section 61. Respondent contends the $14,000 constitutes unreported taxable income and that petitioners have failed to carry their burden of proving the determination inaccurate. Respondent determined the unreported income using the bank deposits metho

payments were not made to him or for his benefit. Instead, petitioner has stated that he and his spouse directed the 1987 ASCS payment of $11,198.96 to be applied to his FHA loan. The ASCS payments fall within the broad definition of gross income in section 61. Accordingly, we sustain respondent's determination on this issue. To reflect the foregoing and concessions by respondent, Decision will be entered under Rule 155. 5Sec. 1.61-4(a)(4), Income Tax Regs., provides that farmers using the cash

selling price, and petitioners complied with the restriction; consequently, respondent is precluded from allocating profits purportedly attributable to such excess from petitioners' refining subsidiaries to petitioners' offtakers pursuant to either sec. 61, I.R.C., or sec. 482, I.R.C. Commissioner v. First Security Bank, 405 U.S. 394 (1972); Procter & Gamble Co. v. Commissioner, 95 T.C. 323 (1990), affd. 961 F.2d 1255 (6th Cir. 1992), followed. 1 On Jan. 7, 1991, Exxon Corp. and Affiliated Comp

selling price, and petitioners complied with the restriction; consequently, respondent is precluded from allocating profits purportedly attributable to such excess from petitioners' refining subsidiaries to petitioners' offtakers pursuant to either sec. 61, I.R.C., or sec. 482, I.R.C. Commissioner v. First Security Bank, 405 U.S. 394 (1972); Procter & Gamble Co. v. Commissioner, 95 T.C. 323 (1990), affd. 961 F.2d 1255 (6th Cir. 1992), followed. 1 On Jan. 7, 1991, Exxon Corp. and Affiliated Comp

Regarding petitioner’s Motion, we held that respondent is not collaterally estopped from assert- ing that petitioner received gross income because there is no identity between “proceeds” for purposes of 18 U.S.C. § 981 and “income” for pur- poses of section 61. Thus, the district court’s decision not to enter a judgment of forfeiture should not be given collateral estoppel effect.4 On May 22, 2020, the parties filed a Stipulation of Settled Issues in the excise tax case, memorializing several co

wed CFM’s section 831(b) election because the premium income was paid as part of a transaction that was “not [an] insurance transactio[n] within the meaning of federal tax law.” He also asserted that CFM was liable for tax on insurance income under section 61.34 The Commissioner disallowed the Prestas’ passthrough insurance deduction for 2012, 2013, and 2015 from the Caputo’s entities because the payments to CFM were not insurance premiums and therefore were not deductible.

§ 61; Campodonico v. United States, 222 F.2d 310, 314 (9th Cir. 1955). Gambling losses are allowable as an itemized deduction but only to the extent of gains from gambling transactions. See I.R.C. § 165(d); Boyd v. United States, 762 F.2d 1369, 1372–73 (9th Cir. 1985). To establish entitlement to a deduction for gambling losses the taxpayer

See § 61; see also Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 430 (1955). Petitioners contend that the funds CSI received in 2015 may be excludable from income under section 351. This “capital contribution” theory is different from any theory advanced by petitioners in their Petitions, at trial, or in their posttrial briefs. Because petitioners

Unreported Income The Code provides that “gross income means all income from whatever source derived,” including “[c]ompensation for services.” § 61(a)(1).

The computation of income of a Schedule C business takes into account, among other things, returns and allowances to reduce gross sales. See Pittsburgh Milk Co. v. Commissioner, 26 T.C. 707, 716 (1956) (citing Am. Lace Mfg. Co. v. Commissioner, 8 B.T.A. 419 (1927)). As the U.S. Court of Appeals for the Ninth Circuit later put it: The P

Regarding petitioner’s Motion, we held that respondent is not collaterally estopped from assert- ing that petitioner received gross income because there is no identity between “proceeds” for purposes of 18 U.S.C. § 981 and “income” for pur- poses of section 61. Thus, the district court’s decision not to enter a judgment of forfeiture should not be given collateral estoppel effect.4 On May 22, 2020, the parties filed a Stipulation of Settled Issues in the excise tax case, memorializing several co

Section 61 accordingly includes in gross income “all gains except those specifically exempted.” James, 366 U.S. at 219. “A gain ‘constitutes taxable income when its recipient has such control over it that, as a practical matter, he derives readily realizable economic value from it.’” Id. (quoting Rutkin v. United States, 343 U.S. 130, 137 (1952)).

The Supreme Court has long reiterated the sweeping scope of section 61, and it is well established that statutory exclusions from income are to be narrowly construed.

Inclusions in gross income under section 61 are construed broadly, whereas exclusions from gross income are construed narrowly.

See § 61; Campodonico v. United States, 222 F.2d 310, 314 (9th Cir. 1955). Gambling losses are allowable as an itemized deduction, but only to the extent of gains from gambling transactions. See § 165(d); Boyd v. United States, 762 F.2d 1369, 1373 (9th Cir. 1985). In order to establish entitlement to a deduction for gambling losses the taxpayer must pr

Taxability of Retirement Distributions Section 61 broadly defines gross income to include “all income from whatever source derived” and specifically enumerates annuities and pensions as items of income.

Petitioner concedes that he received taxable interest and dividend income from Och-Ziff. He asserts, however, that he should be taxed only on part of it because part of it belonged to his brother. Unfortunately, petitioner has not provided any documentary evidence to show that any partnership shares in Och-Ziff were owned by both him a

6 In 2017 section 61 was amended, with section 61(a)(12) becoming section 61(a)(11).

Inclusions in gross income under section 61 are construed broadly, whereas exclusions from gross income are construed narrowly.

Gross Income The Internal Revenue Code provides that “gross income means all income from whatever source derived,” including “[c]ompensation for services.” § 61(a)(1).

See §§ 61, 72(a)(1), 408(d)(1). Such distributions are taxable in full unless the tax- payer has acquired a basis in her account (for example) by making non- deductible contributions to it. See §§ 72(b), (e)(6), 408(d)(2); Campbell v. Commissioner, 108 T.C. 54, 66–67 (1997). In cases of unreported income, the Commissioner must establish an evidentiary f

Inclusion of Program Revenue in Gross Income Section 61 broadly defines gross income as “all income from whatever source derived.” We narrowly construe any exclusions from this sweeping definition.

And then, upon a distribution from the corporation to the shareholders, 24One such transaction was a funded profit-sharing plan that benefited the Berrittos. 25Respondent also misapplies Alondra Indus., Ltd. v. Commissioner, T.C. Memo. 1996-32. Respondent argues that Enterprises is an “S corporation,” and that therefore Alondra should not

Constructive Transfers Generally, unless otherwise provided, gross income under section 61 includes all accessions to wealth from whatever source derived.

cess is, first, a return of 30 [*30] capital, and any remaining amount is taxed as capital gain. § 301(c). Among the items entering the computation of corporate earnings and profits for a particular period are items includible in gross income under section 61. See Treas. Reg. § 1.312-6(b). Gross income includes income derived from a business, regardless of whether the business is lawful or whether the money was obtained unlawfully. See § 61(a)(2); James v. United States, 366 U.S. 213, 221 (1961)

At trial petitioner took the position that “[w]hat is here before the Court today is a trust, and that would be ‘we’, ‘us’, ‘it’, right. Trusts are not ‘I’, and so 3 Under section 7491(a), the burden of proof may shift to the Commissioner as to certain factual issues relevant to a taxpayer’s tax liability if the taxpayer meets certain conditi

222, 230 (2010) (quoting § 61) (“Gross income for the purpose of calculating taxable income is defined as ‘all income from whatever source derived.’”).

And then, upon a distribution from the corporation to the shareholders, 24One such transaction was a funded profit-sharing plan that benefited the Berrittos. 25Respondent also misapplies Alondra Indus., Ltd. v. Commissioner, T.C. Memo. 1996-32. Respondent argues that Enterprises is an “S corporation,” and that therefore Alondra should not

16 The WBO correctly notified petitioner—in the preliminary and final determinations—that his award is includible in gross income under section 61 and subject to federal tax reporting and backup withholding requirements by the WBO in the year of payment.

A class of gross income may consist of one or more items of gross income enumerated in section 61 such as compensation for services, gross income derived from business, interest, rents, royalties, dividends, or subdivisions of these items.

This includes income that is paid directly to a taxpayer and income that a taxpayer receives indirectly--for example, through nominees or alter egos or sham entities. See, e.g., Foxworthy, Inc. v. Commissioner, T.C. Memo. 2009-203, 2009 WL 2877850, at *20, aff’d, 494 F. App’x 964 (11th Cir. 2012); K&M La Botica Pharmacy, Inc. v. Commission

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

y this chapter [1] * * * [is] credited” with specified amounts. Thus, both sections 27 and 901 clearly provide that the foreign tax credit allowable under the Code reduces only tax imposed under chapter 1, such as the section 1 regular tax. See also sec. 61 (defining gross income for purposes of the section 1 regular tax); sec. 63(a) (defining taxable income for those purposes). Section 1411 is in chapter 2A, subtitle A, Income Taxes. Thus, the foreign tax credit under section 27--which applies

When an employee receives health insurance coverage for himself or his spouse and dependents as a benefit through an employer-sponsored health care plan, the premiums paid for such coverage may generally be excluded from that employee’s gross income. Secs. 106(a), 125(a); sec. 1.125-1(h)(2), Proposed Income Tax Regs., 72 Fed. Reg. 43951 (A

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

A distribution from an IRA is generally included as income to the distributee in the year of the distribution. Sec. 408(d)(1); Schoof v. Commissioner, 110 T.C. 1, 7 (1998); sec. 1.408-4(a)(1), Income Tax Regs. Respondent produced a Form 1099-R issued by LNLI that reported an IRA distribution of $4,471 to petitioner for 2012, thereby satisf

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

This includes income that is paid directly to a taxpayer and income that a taxpayer receives indirectly--for example, through nominees or alter egos or sham entities. See, e.g., Foxworthy, Inc. v. Commissioner, T.C. Memo. 2009-203, 2009 WL 2877850, at *20, aff’d, 494 F. App’x 964 (11th Cir. 2012); K&M La Botica Pharmacy, Inc. v. Commission

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

g to do with income. Distributions are capital that owners remove from their corporations, see Rogers v. Commissioner, 102 T.C.M. (CCH) 536, 538 (2011), aff’d, 728 F.3d 673 (7th Cir. 2013), while income is, among other things, gains and profits, see sec. 61. An S corporation shareholder may pay tax on her corporation’s earnings, keep the money in the corporation till a later year, and then pay it to herself--that’d be a distribution. But in the year the corporation earns that income, its owner m

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

61; Avrahami, 149 T.C. at 174. Insurance companies are generally taxed on their income in the same manner as - 31 - [*31] other corporations. See sec. 831(a). And that’s what made the $1.2 million in consulting deductions and premiums so likely to raise the IRS’s bureaucratic eyebrows--that’s the limit on premiums that an insurer can receive

Memo LEXIS 592, at *13 ("Amounts received by ministers and members ofa religious order for services are includable in their gross income under section 61 and constitute taxable income unless excluded by some specific provision ofthe Code.").

61.08(1) (2006)).5 Permanent periodic alimony provides for the support and maintenance ofa spouse during his or her lifetime but terminates upon the death ofthe payee spouse. M Rehabilitative alimony is "paid for the purpose ofrehabilitating the spouse to whom it is awarded," e.g., "financially supporting an ill spouse until health is restored

ied by respondent, through a notice, to fall outside the plain text ofsection 32. Ifleft alone section 32 would allow petitioners the benefits ofearned income for their Medicaid waiver payment, but that payment would remain subject to taxation under section 61. Respondent, however, has decided to disturb this equilibrium by telling taxpayers like petitioners that they need not pay tax on their Medicaid waiver payments. While respondent's notice may be well intended and we are not critical ofthe

1.61-1(a), Income Tax Regs. Because ofthe sweeping scope of section 61, the Supreme Court has held that exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 328 (1995). - 22 - [*22] Petitioner argues that it falls under one such exclusion: section 118(a),¹² which provides that, in general, "[i]n

on A. Unreported Income Under section 61(a), "gross income means all income from whatever source derived". See Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). The Supreme Court has repeatedly emphasized the "'sweeping scope' ofthis section [sec. 61] and its statutory predecessors." Commissioner v. Schleier, 515 U.S. 323, - 18 - [*18] 327 (1995) (quoting Commissioner v. Glenshaw Glass Co., 348 U.S. at 429). Section 6001 requires taxpayers to maintain sufficient records to allow the IRS t

However, taxpayers with business income are allowed to offset the gross receipts oftheir business with COGS and returns and allowances when computing the business' gross income. See Smith v. Commissioner, T.C. Memo. 2015-214, at *11; sec. l.61-3(a), Income Tax Regs. Although returns and allowances are not technically deductions, taxpayers

Receipt ofIncome Under Section 61 Under section 61(a) "gross income means all income from whatever source derived".

However, taxpayers with business income are allowed to offset the gross receipts oftheir business with COGS and returns and allowances when computing the business' gross income. See Smith v. Commissioner, T.C. Memo. 2015-214, at *11; sec. l.61-3(a), Income Tax Regs. Although returns and allowances are not technically deductions, taxpayers

However, taxpayers with business income are allowed to offset the gross receipts oftheir business with COGS and returns and allowances when computing the business' gross income. See Smith v. Commissioner, T.C. Memo. 2015-214, at *11; sec. l.61-3(a), Income Tax Regs. Although returns and allowances are not technically deductions, taxpayers

It includes all income included in gross income under section 61, except for items specifically excluded by the regulations.

61 (gross income defined as income from whatever source deriveth). But the relationship between a pastor and his flock is far from entirely commercial, and the Feltons argue that, at least in part, they are supported by gifts, not wagesjustly bargained for andjustly earned in the marketplace: "[W]hen I preach the gospel, I may make the gospel

354 (1973). Because the alleged theft took place in California, we apply California law. Under California Penal Code section 484, any person who shall "feloniously steal, take, carry, lead, or drive away the personal property ofanother, * * * or who shall knowingly and designedly, by any false or fraudulent representation or pretense, def

"Gross income" for purposes ofsection 6501(e)(1)(A)(i) generally means "gross income" as defined in section 61(a), which generally includes gains derived from dealings in property.¹² CNT Iny'rs, LLC v.

Receipt ofTaxable Income Under Section 61 Section 61(a) provides that "gross income means all income from whatever source derived".

The IRS sent Feedback a notice ofdeficiency in May 2013 that questioned whether Feedback was a valid insurance company and determined that "the amounts characterized as insurance premiums" were income to Feedback under section 61 since Feedback had not established that they were excludable under 4¹(...continued) evidenced by documentation approved by the Registrar." - 45 - another provision ofthe Code.

The Code provides that gross income includes all income from whatever source derived unless excluded by law.

The IRS sent Feedback a notice ofdeficiency in May 2013 that questioned whether Feedback was a valid insurance company and determined that "the amounts characterized as insurance premiums" were income to Feedback under section 61 since Feedback had not established that they were excludable under 4¹(...continued) evidenced by documentation approved by the Registrar." - 45 - another provision ofthe Code.

Respondent, relying on section 61, states that gross income includes all income from whatever source derived, including compensation for services.

(noting that although section 6501 does not define the term "gross income" for purposes ofsection 6501(e), the term is generally understood to refer to the definition ofgross income found in section 61); cf Benson v.

Finally, neither section 61 nor the regulations thereunder prevent us from applying both the deferred compensation provisions and split-dollar life insurance regulations to the same set oftransactions.

Therefore, any individual with gross income above $9,350 for taxable year 2010 was required to file an income tax return.2 Section 61 defines gross income as income from whatever source derived and enumerates a nonexclusive list ofitems that constitute gross income.

61; McClanahan v. United States, 292 F.2d 630, 631-632 (5th Cir. 1961). Taxpayers who are "professional gamblers" engaged in the trade or business ofgambling may deduct their gambling losses up to the amounts oftheir gains to arrive at adjusted gross income. See secs. 61(a)(1), 165(d); Boneparte v. Commissioner, T.C. Memo. 2015-128. In the cas

Section 61 defines gross income to include all ofthese categories ofincome. Accordingly, Mr. Blair is liable for income tax in the amount determined by the Commissioner. III. Mr. Blair Is Liable for an Additional Tax Under Section 72(t). Section 72(t)(1) imposes, with certain exceptions, an additional tax on an early distribution from a qualified r

Finally, neither section 61 nor the regulations thereunder prevent us from applying both the deferred compensation provisions and split-dollar life insurance regulations to the same set oftransactions.

61; McClanahan v. United States, 292 F.2d 630, 631-632 (5th Cir. 1961). Gross income from a wagering transaction is generally calculated by subtracting the bets placed to produce the winnings as a preliminary computation in determining gross income. See Lutz v. Commissioner, T.C. Memo. 2002-89, slip op. at 10-11. a. Respondent's pretrial posit

Section 61 defines gross income as "all income from whatever source derived". It is well settled that loan proceeds are not included in gross income because ofthe obligation to repay the loan. Commissioner v. Tufts, 461 U.S. 300, 307 (1983). Whether a particular transaction constitutes a loan is a question offact to be determined by considering all

The Supreme Court has repeatedly emphasized the "'sweeping scope ofthis section [i.e., section 61]' and its statutory predecessors." Commissioner v.

Section 61 defines gross income as "all income from whatever source derived". Income can include the forgiveness ofindebtedness or compensation for services.5 In some instances, compensation can be advanced with services to be performed later. The distinction is an important one. An advance on services to be performed in the future is taxed at the

This motion representedthat petitioner had served a request for answers to interrogatories demanding that respondent admit or deny propositions that inclu- ded multiple variations on the following themes: (1) section 61 does not contain the word "wages" or "liable"; (2) petitioner is not a "person" who is liable for tax; (3) petitioner's wages are not "wages" subject to tax under subtitle A; and (4) petitioner's wages are not subject to statutory deficiency procedures.

In particular, the realization requirement circumscribes the broad scope of section 61 to "undeniable accessions to wealth * * * over which the taxpayer[] - 21 - [*21] ha[s] complete dominion." Commissionerv.

All ofthat income was gross income under section 61 and taxable income under section 63, and the amounts far exceeded the levels requiring a return under sections 1(d), 6011(a), and 6012(a).

(c) Ifsuch assertions are correct, then under IRC Section 61 the life insurance owned by the Plan should have been income to Petitioners in 1990, when the insurance was first acquired.

435, 445 (1987); see also sec.

Gross income does not, however, include losses derived from dealings in property, as section 62, not section 61, provides for the deduction ofsuch losses.

61.08(5) (West 2006 & Supp. 2015). Bridge-the-gap alimony terminates upon the death ofeither party or upon the remarriage ofthe recipient. Id [*4] proceeding. The second order obligated petitioner to pay $45,000 to Ms. Filippini. Ms. Filippini testified at trial that the $45,000 payment was a settlement for attorney's fees and the division of

We reasoned that “moneys paid to any taxpayer as compensation for an advance waiver of possible future damages for personal injuries, would constitute taxable income to him under section 61 of the 1954 Code; and would not be excludable from his gross income under section 104(a)(2) of said Code.” Id.

Gross income does not, however, include losses derived from dealings in property, as section 62, not section 61, provides for the deduction of such losses.

Therefore, “any interest, dividends and other income received by the custodian on securities and other assets held in the custodial accounts are includible in the gross income of the policyholder under section 61 * * * for the year in which they are received by the custodian.” Id.

rreceived (2003). In the alternative, it is determined that the transfer, whether direct or indirect, in 2003 from the ESOP's trust to the IRA of Thomas J. Heckman in the amount of$233,930.03 is includible in the income ofThomas J. Heckman under IRC section 61. Furthermore, such a transfer is neither an eligible rollover distribution from a - 7 - [*7] qualified plan under IRC section 402(c) nor a direct trustee-to-trustee transfer under IRC section 402(e)(6). OnNovember 1, 2010, petitionertimely

Section 61 lists specific forms ofgross income, including income from life insurance contracts and income from discharge ofindebtedness. Sec. 61(a)(10), (12). - 8 - [*8] For Federal income tax purposes, Mr. Black's life insurance policy loans were true loans. See McGowenv. Commissioner, T.C. Memo. 2009-285, 2009 WL 4797538, aff'd, 438 Fed. Appx. 6

Except when it doesn't. See generally subch. B, p. III, Items Specifically ExcludedFrom Gross Income. And the Code isn't always perfectly clear, so courts have established rules as well. An old case, Raytheon Prod. Corp. v. Commissioner, 144 F.2d 110 (1st Cir. 1944), aff'g 1 T.C. 952 (1943), was one ofthe first to discuss how the IRS shoul

61.075(2) (West 2006 & Supp. 2014) provides: Ifthe court awards a cash payment for the purpose ofequitable distribution ofmarital assets, to be paid in full or in installments, the full amount ordered shall vest when thejudgment is awarded and the award shall not terminate upon remarriage or death ofeither party, unless otherwise agreed to by

Respondent reconstructedpetitioner's gross income using information from third- party returns and records. Respondent adequately supported the determination that petitioner received $7,571 ofwages from Terra Soil Farming, LLC, in the 2009 tax year by introducing third-party documentation. Respondent also showed that petitioner received $35

llar life insurance regulation that went into effect for all arrangements entered into or materially modified after September 17, 2003, was applicable here, the loan proceeds the Pinns received might well have been classified as taxable income under sec. 61 to them in the years they received (continued...) -37- [*37] to pay taxes on the loans ifthey become ineligible for their death benefits, or when their death benefits are used to satisfy their debts. See Old Colony Trust Co. v. Commissioner,

Because self-employment income, dividends, capital gains, and interest must be included in petitioner's income under section 61, we sustain respondent's determinations with respect to the increased deficiencies as modified by concessions.

- 18 - [*18] in petitioner's income under section 61, we sustain respondent's determinations with respect to the interest income from Suncoast.

llar life insurance regulation that went into effect for all arrangements entered into or materially modified after September 17, 2003, was applicable here, the loan proceeds the Pinns received might well have been classified as taxable income under sec. 61 to them in the years they received (continued...) -37- [*37] to pay taxes on the loans ifthey become ineligible for their death benefits, or when their death benefits are used to satisfy their debts. See Old Colony Trust Co. v. Commissioner,

Gross income is defined in section 61 to include "all income from whatever source derived, including (but not limited to) * * * [g]ross income derived from business".

l payment oftax that the employer should have withheld. But it nonetheless remains true that the employer's liability under sections 3402(a) and 3403 for withholding taxes is separate and distinct from the employee's liability for income taxes under section 61. -50- employee, and ifso, to compute reduction in employer's deficiency), aff'g in part remanding in part T.C. Memo. 2003-162. The Code doesn't have a section like 3402(d) that could rescue employees.8 Without one, an employee doesn't get

2011); see also Atwood v.

Because self-employment income, dividends, capital gains, and interest must be included in petitioner's income under section 61, we sustain respondent's determinations with respect to the increased deficiencies as modified by concessions.

ifts or donations as petitioners contend--theyrepresented a quid pro quo exchange; i.e., the payors were receiving petitioners' services in consideration for their payments. Accordingly, the deposits are includible in petitioners' gross income under section 61. "(...continued) Gardner identified some deposits at trial that he claimed were cash advances. He testified that he had "different credit card limits on different credit cards" and was able to secure such large cash advances by transferrin

Commissioner, 52 T:C. at 6. Sec. 1.312-6(b), Income Tax Regs., requires a corporation to include in earnings and profits income exempted by statute, income not taxable by the Federal Governmentunder the Constitution, and all income includable under sec. 61. - 13 - and profits," but a corporation may deduct other items from earnings and profits that it may not deduct in computing taxable income.15 Some items are deductible . from both taxable income and earnings and profits, but the amount or ti

xélar 419 plan and the Millennium plan in their income: (1) the contributions were constructive dividends to Dr. and Mrs. White under secs. 301 and 61, and (2) the contributions were compensatory and includible in income as an economic benefit under sec. 61. - 4 - terminated in 2003, the insurance policies held by the xélan 419 plan were distributable to Dr. and Mrs. White; and (4) whether petitioners are liable for accuracy-relatedpenalties under section 6662(a) for substantial understatements

Because nonemployee compensation, wages, and cancellation ofindebtedness income must be included in petitioner's income under section 61, we sustain respondent's determination with respect to deficiencies in tax.

Because wages must be included in petitioner's income under section 61, we sustain respondent's determination with respect to the deficiencies in tax.

§ 61, 72, 83 and 402(b)(1), and 402(b)(4). The taxpayers have not cooperated with the income tax examination, and as a result, the best information available as to the value ofthe assets held for the taxpayers' benefit in the trust associated with the Benistar 419 Plan, or their vested accrued interest therein, are the payments summarized above. Th

61.08(1) (West 2006); Kirchman v. Kirchman, 389 So. 2d 327, 329-330 (Fla. Dist. Ct. App. 1980). Permanent alimony is an allowance for the support and maintenance ofa spouse during his or her lifetime. Cann v. Cann, 334 So. 2d 325, 329 (Fla. Dist. Ct. App. 1976). The · obligation for periodic alimony afforded by a final divorce decree terminate

Section 61 próvidès that gross income includes all income from whatever source derived, specifically including compensation for services. Sec. 61(a)(1) Compensation is further defined to include wages, salaries, and bonusek Sec. 1.61-2(a)(1), Income Tax Regs. Exclusions from income exist ifthe t¼xþayer can establish a specific legislative authoriza

61.30(11)(a)(8) (West 2012)). Alaska has had a similar law in place since 1998. See 1998 Alaska Sess. Laws ch. 132 (H.B. 344), sec. 13 (currently codified at Alaska Stat. Ann. sec. 25.24.152(a) (West 2010)). And Colorado as well, since at least 1992. See 1992 Colo. Legis. Serv. H.B. 92-130, sec. 1 (West) (currently codified at Colo. Rev. Stat.

Section 61 defines gross income to include "all. income from whatever source derived". The "specific item" method is an indirect method ofincome reconstruction that consists ofevidence ofspecific amounts ofincome received by a taxpayer and not reported on the taxpayer's return. Estate ofBeck v. Commissioner, 56 T.C. -7- 297, 353, 361 (1971). It is

61; McClanahan v. United States, 292 F.2d 630, 63.1-632 (5th Cir. 1961). In the case ofa taxpayernot engaged in the trade or business of gambling, gambling losses are allowable as an itemized deduction, but only to the extent ofgains from gambling transactions. Sec. 165(d); McClanahan, 292 F.2d at 632. In order to establish entitlement to a de

We similarly find none; and in the absence of congressional intent we note that we have strictly construed section 104(a)(1) to conform to the general purview of section 61, that all income is taxable unless explicitly excluded.

A.stipulation shäll be treated, to the extent of its terms, as a conclusive admissïon by the parties to the stipulation, and the Court will no: permit a party to a stipulation to qualify, change, or contradict'a stipulation in wholé or in part. aRule 91('e)"; cf. Jasionowski v. Commissioner, 66. T.C. 312, 318 (1976) (stiþulated fact

Section 61 is broad, requiring that gains from lawful and unlawful activities be included as income. See, e.g., Rutkin v. United States, 343 U.S. 130, 137 (1952) ("An unlawful gain, as well as a lawful one, constitutes taxable income when its recipient has such control over it that, as a practical matter, he derives.readily realizable economic valu

61; see Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 430 (1955). Respondent determined that petitioners underreported their gross receipts by $43,608 on their 2004 Schedule C. As a general rule, the Commissioner's determinations set forth in a notice of deficiency are presumed correct, and the taxpayer bears the burden- of proving that th

61; United States v. Monteiro, 871 F.2d 204, 206 (1st Cic. 1989); Johnstón vi. Commissioner; -25 T.C. 106, 107-108 (1955) . In general, "int erest * s * * -, dividends rents , salariese, wages; premiums, annuit ies, comyensations remunerations, emoluments, and ot her fixed or determinable annual or-periodical gaEns, profits, tand?income" that,

Interest and Dividend Income Section 61 defines gross income to include "all income from whatever source derived".

The increase in the limitation effected by section 24 (d) (1) (B) (i) is equal to 15 percent of "the taxpayer's earned income (within the meaning of section 32) which is taken into account in computing taxable income for the taxable year".

The definition of gross income under section 61.(a) broadly encompasses "any accession to a taxpayer's wea-lth.

s any reason the substitute for ordinary income doctrine is applicable to the sales of petitioners' State tax credits. The parties and this Court agree that the receipt of a State tax credit is not an accession to wealth that results in income under section 61. See Browning v. Commissioner, 109 -T.C. 303, 324-325 (1997); Rev. Rul. 79-315, 1979-2 C.B 27. We know of no authority, and respondent has not cited any, for the proposit'ion that a State" income tax credit results in ordinary income upon

Section 7491(a), however, -provides that i-f ethe taxpayer introduces credibleyevidence and meets certain other prerequisites, the Commissioner shall bear thë.burden of proof with respect.to a factual issues relating to the taipayer'ss liability for a tax .

455, 456 ("outside of the trade-or-business context * * * the section 61 definition of gross income applies").

However, petitioner argues that the income he received in 2005 was not taxable income within the meaning of the law.

61; McClanahan v. United States, 292 F.2d 630, 631-632 (5th Cir. 1961). In the case of a taxpayer not engaged in the trade or business of gambling, gambling losses are allowable as an itemized deduction, but only to the extent of gains from such transactions. Sec. 165(d); McClanahan v. United States, supra at 632 n.1 (citing Winkler v. United

- 8 - and 2007 are compensation.for services contemplated by section 61 and taxable to him as income.

s any reason the substitute for ordinary income doctrine is applicable to the sales of petitioners’ State tax credits. The parties and this Court agree that the receipt of a State tax credit is not an accession to wealth that results in income under section 61. See Browning v. Commissioner, 109 T.C. 303, 324-325 (1997); Rev. Rul. 79-315, 1979-2 C.B 27. We know of no authority, and respondent has not cited any, for the proposition that a State income tax credit results in ordinary income upon its

455, 456 (“outside of the trade-or-business context * * * the section 61 definition of gross income applies”).

Boyd, supra at 357; see also Canakaris v.

61 .08(1) (West 2006) . "By definition, `lump-sum alimony' is a fixed and certain amount, the right to which is vested in the recipient and which is not therefore subject to increase, reduction, or termination in the event of any contingency, specifically including those of death or remarriage ." Boyd v . Boyd , 478 So . 2d 356, 357 (Fla . Dis

1, 12-14 (1.995) ;" see also Woodbury V .

rented for less than 15 days during the taxable year, then no deduction allocable to the rental use of such dwelling unit is allowed, and the income derived from such use for the taxable year is not included in the gross income of the taxpayer under section 61 . Sec . 280A(g) . Contrary to petitioner's contention in his brief, a taxpayer is deemed to "have used a dwelling unit for personal purposes for a day if, for any part of such day, the unit is used" fo r personal purposes by the taxpayer o

Section 61 lists specifically some forms of gross income, including the income from a life insurance contract and the income from a discharge of indebtedness . See sec . 61(a)(10), (12) . . Neither party disputes that petitioners have received income as a result of the termination of their variable life insurance policy and that petitioners intende

61 .08(1) (West 2006) . Lump-sum alimony is the payment of a definite sum and creates a vested right that survives death . Mann v . Commissioner , 74 T .C! 1249, 1260 (1980) ; Estate of Hoffman v . Commissioner , T .C . Memo . 2001-109 ; Canakaris v . Canakaris , 382 So . 2d 1197, 1201 (Fla . 1980) . 4 -10- The lump-sum "alimony" payments wou

Section 61 specifically includes annuities and pensions as items of gross income . Sec . 61 (a) (9) (11) (cid:127) . Statutory exclusions from income are matters of legislative grace and are narrowly construed . Commissioner v . Schleier, 515 U.S . 323, 328 (1995) . Taxpayers seeking) an exclusion from income must demonstrate they are eligible for

Gambling Winnings Section 61 defines gross income as all income from whatever source derived .

Discussion Under section 61, all income from whatever source derived is included in gross income .

Section 61 defines gross income as all income from whatever source derived .; However, in determining gross income taxpayers may offset gross receipts by the cost of goods sold . Sec . 1 .61-3(a), Income Tax Regs . Section 6001 and the regulations thereunder require taxpayers to maintain adequate books and records of their income ; and expenses . W

Summary Judgment Rule 121(a) provides that either party may move for summary judgment upon all or any part of the legal issues in controversy .

ng materiality we must know which item to address, interest or late-fee income. Petitioners contend that the references to “item” throughout section 1.446-1(e), Income Tax Regs., mean an “item of income or deduction”. “Items of income” are listed in section 61. Under petitioners’ theory, because item means item of income, under Gitlitz v. Commissioner, 531 U.S. 206 (2001), the Court must look to section 61 to determine what an item is. Petitioners give the Supreme Court’s holding in Gitlitz far

om the sale of property used in a trade or business as the result of overstating the cost or other basis of such property . [Emphasis added.] Respondent relies on cases defining "gross income" for general purposes of section 6501 (e) by referencd to section 61 . Respondent cites section 6501 (e)(1)(A)(), which defines gross income in the context of sale of goods or services, and argues : Any uncertainty in analyzing the sales of business property under I .R.C . sec . 6501 (e) 1(1)(A) results onl

In General Section 61 (a) provides that gross income means all income from whatever source derived .

Section 104(a)(1) provides that gross income does not include "amounts received under workmen's compensation acts as compensation for personal injuries or sickness" .

Section 105 (a) provides that amounts received by an employee through accident :or health insurance for (cid:127) personal injuries or sickness shall be included in gross income to the extent that such amounts are (1) attributable to employer contributions that were not includable in the employee ' s gross income, or ( 2) were paid by the employer.

-360- OPINION143 The provision of section 61 that gross income includes all income from whatever source derived would encompass fees and commissions earned as compensation for services.

61 .08(1) (West 2006) . "By definition, `lump-sum alimony' is a fixed and certain amount, the right to which is vested in the recipient and which is not therefore subject to increase, reduction, or termination in the event of any contingency, specifically including those of death or remarriage ." Boyd v . Boyd, 478 So . 2d 356, 357 (Fla . - 6

401K and had $547 of Federal income tax withheld ; and (3) a letter which stated "he had no `income' in a `constitutional sense' as the word `income' is used in Section 61 of the Internal Revenue Code" and other frivolous tax-protester arguments .

Section 61 expressly defines "gross income" to include, without limitation, "Dividends" . Sec . 61(a)(7) . In the computation of alternative minimum tax, qualified dividends receive special treatment, insofar as they enter into the net capital gain of noncorporate taxpayers . That special treatment essentially caps the amount of alternative minimum

As pertinent here, regulations under section 61 provide : § 1 .61-7 .

-360- OPINION143 The provision of section 61 that gross income includes all income from whatever source derived would encompass fees and commissions earned as compensation for services.

Petitioner’s argument that his compensation and retirement payments constituted a nontaxable return of human capital is directly refuted by the requirement, under section 61, to include those amounts in gross income and by numerous cases affirming the intent of that section to reach any and all income from whatever source derived unless specifically exempted.

61.133(a) and (b) (2002) . See 14 C .F .R. sec . 61 .55 (2002) . Because petitioner did not earn an airline transport pilot rating, he would not be allowed to captain an airplane for an airline company . - 7 - On this entire record, the Court finds that petitioner made a reasonable attempt to comply with the internal revenue laws and exercise

In General Section 61 (a) provides that gross income means all income from whatever source derived .

Petitioner’s argument that his compensation and retirement payments constituted a nontaxable return of human capital is directly refuted by the requirement, under section 61, to include those amounts in gross income and by numerous cases affirming the intent of that section to reach any and all income from whatever source derived unless specifically exempted.

Unreported Taxable Income Gross income is defined in section 61 as all income from whatever source derived, including, but not limited to, income derived from business .

-360- OPINION143 The provision of section 61 that gross income includes all income from whatever source derived would encompass fees and commissions earned as compensation for services.

Deficiencies Section 61 defines gross income as all income from whatever source derived.

-360- OPINION143 The provision of section 61 that gross income includes all income from whatever source derived would encompass fees and commissions earned as compensation for services.

-360- OPINION143 The provision of section 61 that gross income includes all income from whatever source derived would encompass fees and commissions earned as compensation for services.

Section 61 expressly defines “gross income” to include, without limitation, “Dividends”. Sec. 61(a)(7). In the computation of alternative minimum tax, qualified dividends receive special treatment, insofar as they enter into the net capital gain of noncorporate taxpayers. That special treatment essentially caps the amount of alternative minimum tax

from the sale of property used in a trade or business as the result of overstating the cost or other basis of such property. [Emphasis added.] Respondent relies on cases defining “gross income” for general purposes of section 6501(e) by reference to section 61. Respondent cites section 6501(e)(l)(A)(i), which defines gross income in the context of sale of goods or services, and argues: Any uncertainty in analyzing the sales of business property under I.R.C. sec. 6501(e)(1)(A) results only from t

The Deficiency Section 61 defines gross income as all income from whatever source derived.

1 T.C. 1120, 1128 (1979); Robinson v. Commissioner, T.C. Memo. 1996-154. Section 61(a) provides that, except as otherwise provided, gross income includes all income from whatever source derived. The Supreme Court has reiterated the sweeping scope of section 61. Commissioner v. Banks, 543 U.S. 426 (2005); Commissioner v. Schleier, 515 U.S. 323, 327 (1995); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-431 (1955). Section 104, in contrast, provides an exclusion with respect to compensation

Section 61 (a) provides that gross income includes all income from whatever source derived, unless excludable by a specific provision of the Code .

See also Gitlitz v .

According to petitioner, in a West publication that he read, section 61 cross referenced section 861, and he is therefore “required” to consider it.

The Deficiency Section 61 defines gross income as all income from whatever source derived.

73 penalty, for pursuing frivolous tax arguments. In the notice of deficiency, issued July 21, 2004, respondent determined that the $23,988 that petitioner had received from the Office of Personnel Management in 2001 represented taxable income under section 61. Respondent also determined that petitioner had $2,009 unreported self-employment income as shown on Form 1099-MISC, Miscellaneous Income, from Monumental Life Insurance Company and that petitioner's 2001 Social Security benefits were taxa

This Court has found that the section 61 definition of “gross income” generally applies to section 6501(e)(1)(A).

The Deficiency Section 61 defines gross income as all income from whatever source derived.

Section 61 defines gross income as including wages and the other categories of receipts admitted by petitioner . Arguments to the contrary have been consistently rejected and characterized as frivolous in innumerable cases . No further discussion of them is merited . See Connor v . Commissioner, 770 F.2d 17, 20 (2d Cir . 1985) ; Crain v . Commissio

This Court has found that the section 61 definition of “gross income” generally applies to section 6501(e)(1)(A).

Section 61 defines gross income as including wages and the other categories of receipts admitted by petitioner . Arguments to the contrary have been consistently rejected and characterized as frivolous in innumerable cases . No further discussion of them is merited . See Connor v. Commissioner, 770 F .2d 17, 20 ( 2d Cir . 1985 ) ; Crain v . Commiss

The Court referred petitioner to section 61 and advised petitioner that money and other goods received in exchange for his personal services are taxable income.

y individual. Sec. 1. Section 61(a) specifies that, “Except as otherwise provided”, gross income for purposes of calculating taxable income means “all income from whatever source derived”. The Supreme Court has long reiterated the sweeping scope of section 61. Commissioner v. - 6 - Schleier, 515 U.S. 323, 327 (1995); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-431 (1955); Banaitis v. Commissioner, 340 F.3d 1074, 1079 (9th Cir. 2003), affg. in part and revg. in part on another ground T.

The issues for decision are: (1) Whether assistance payments paid to petitioners by the State of California, Department of Social Services, In-Home Supportive Services program (IHSS), to care for petitioners’ disabled son constitute gross income under section 61, and (2) whether petitioners are entitled to the earned income credit under section 32.

at 284, 285, summarizes the tax treatment of put option premiums as follows: [T]he amount (premium) received by the writer (issuer or optionor) of a “put” or “call” option which is not exercised constitutes ordinary income, for Federal income tax purposes, under section 61 of the Internal Revenue Code of 1954, to be included in his gross income only for the taxable year in which the failure to exercise the option becomes final.

All of the items included in respondent’s determination of income are identified as gross income in section 61 and taxable under sections 1 and 63.

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429 (1955). Income is generally taxable in the year in which the taxpayer receives it unless, under the method of accounting used by the taxpayer, the amount is properly taxable in another year. Sec. 451(a). For taxpayers using the cash method of accounting, income is taxable in the year ac

Major’s Income Terry contended that he did not receive any income as defined in section 61 for the taxable year 2001, but he did not offer any evidence supporting his position.

Assignment of Income Although we have concluded that Taxman and WFIC should be recognized as separate entities, WFIC's real estate commission income during the years at issue may nonetheless be taxable to petitioner under section 61 and the assignment of income doctrine.

dividual. Sec. 1. Section 61(a) specifies that, “Except as otherwise provided”, gross income for purposes of calculating such taxable income means “all income from whatever source derived”. The Supreme Court has long reiterated the sweeping scope of section 61. Commissioner v. Schleier, 515 U.S. 323, 327 (1995); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-431 (1955). Section 104, in contrast, provides an exception with respect to compensation for injuries or sickness. Such exclusions f

he statement that, “...this can not be frivo- lous... .” This mere assertion is not supported by the facts or by law. The courts have consistently ruled that arguments of this nature are considered frivolous. - 7 - You correctly point out that IRC §61 defines income. More precisely, §61 defines Gross Income. * * * Sec. 61. Gross Income defined. (a) General definition. Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not lim

All of the categories of income - 4 - received by petitioner during the years in issue are specified in section 61, which provides in relevant part: SEC.

Petitioner, as early as the amended petition, admitted receiving this income and provided respondent a document to support this admission. Petitioner further admitted that this amount was not included in the notice of deficiency. 3 We note that, in the alternative, .we could have dismissed this portion of the case pursuant to Rule 123(b).

at 284, 285, summarizes the tax treatment of put option premiums as follows: [T]he amount (premium) received by the writer (issuer or optionor) of a “put” or “call” option which is not exercised constitutes ordinary income, for Federal income tax purposes, under section 61 of the Internal Revenue Code of 1954, to be included in his gross income only for the taxable year in which the failure to exercise the option becomes final.

61.08 (West 1999); Canakaris v. Canakaris, 382 So. 2d 1197, 1200 (Fla. 1980). “Lump sum alimony” is “a fixed and certain amount, the right to which is vested in the recipient and which is not therefore subject to increase, reduction, or termination in the event of any contingency, - 10 - specifically including those of death or remarriage.” B

61.16 (West 1997). Florida courts have affirmed the policy that obligations to pay attorney's fees of a former spouse stemming from the divorce should survive the death of the payee. Faust v. Faust, 553 So. 2d 1275 (Fla. Dist. Ct. App. 1989) (the purpose of Fla. Stat. Ann. sec. 61.16 is to ensure that both parties to the dissolution action had

itioner’s motion for summary judgment summarizes his position as follows: this is what must happen in order for there to be taxable domestic income: 1)One must receive a taxable “item” of income (e.g. compensation, interest, rents, etc.) per 26 USC §§ 61 and following. I stipulate that my income appears to be a taxable item. 2) The “source rules” must categorize the income as domestic income per 26 USC §§ 861(a) and 26 CFR §§§§ 1.861-2 through 1.861-7. I stipulate that my income appears to be do

Accountable Plan Section 61 includes in gross income all income, from whatever source derived.

Section 61 defines gross income as all income from whatever source derived. Gross income includes compensation for services. Sec. 61(a)(1). Respondent submitted petitioner’s 2000 return, which included the Form 1099 that was attached to the 2000 return (listing $29,490.83 in income paid to petitioner from Dynamex), and business records of Dynamex e

Commissioner, T.C. Memo. 2002-148 (citing Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955)). Section 301, however, places a restriction on the definition of gross income. Barnard v. Commissioner, T.C. Memo. 2001-242. Generally, that section provides that funds distributed by a corporation over which the shareholder has d

When a taxpayer fails to provide adequate records - 7 - substantiating income, the Commissioner is authorized to reconstruct the taxpayer’s income by using any reasonable method that clearly reflects income, including the use of bank deposit records. Sec. 446(b); Clayton v. Commissioner, 102 T.C. 632, 645 (1994). Bank deposits are prima f

Section 61 specifically lists "pensions" as a source of gross income. Sec. 61(a)(11); sec. 1.61-11, Income Tax Regs. Generally, any amount distributed to a distributee by an employees trust is taxable to the distributee in the taxable year of the distribution under section 72. Sec. 402(a) and (b). - 6 - Amounts received by an employee under accide

Section 135(a) provides that, in the case of an individual who pays qualified higher education expenses during the taxable year, no amount shall be includable in gross income by reason of the redemption during such year of any qualified U.S.

dividual. Sec. 1. Section 61(a) specifies that, “Except as otherwise provided”, gross income for purposes of calculating such taxable income means “all income from whatever source derived”. The Supreme Court has long reiterated the sweeping scope of section 61. Commissioner v. Schleier, 515 U.S. 323, 327 (1995); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-431 (1955); Banaitis v. Commissioner, 340 F.3d 1074, 1079 (9th Cir. 2003), affg. in part and revg. in part on another ground T.C. Me

Generally, amounts received through accident or health insurance for personal injuries or sickness are excluded from gross income under section 104(a)(3), unless the amounts are either (1) attributable to contributions by the employer that were not includable in the gross income of the employee or (2) paid by the employer. If amounts recei

dividual. Sec. 1. Section 61(a) specifies that, “Except as otherwise provided”, gross income for purposes of calculating such taxable income means “all income from whatever source derived”. The Supreme Court has long reiterated the sweeping scope of section 61. Commissioner v. Schleier, 515 U.S. 323, 327 (1995); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-431 (1955). Section 104, in contrast, provides an exception with respect to compensation for injuries or sickness. Such exclusions f

61; Commissioner v. Kowalski, 434 U.S. 77, 82-83 (1977); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 430 (1955). The Internal Revenue Code provides no exclusion from gross income for proceeds received by a relator in a qui tam proceeding. In Eisner v. Macomber, supra, the Supreme Court decided that a shareholder-taxpayer did not realize

Section 61 defines gross income as "all income from whatever source derived". Section 61(a)(12) provides that gross income specifically includes amounts received from a discharge of indebtedness (DOI). A taxpayer may realize DOI income by paying an obligation at less than its face value. United States v. Kirby Lumber Co., 284 U.S. 1 (1931). The und

The Commissioner may use any reasonable means to reconstruct a taxpayer’s income. Counts v. Commissioner, 774 F.2d 426, 428 (11th Cir. 1985), affg. T.C. Memo. 1984-561. When the Commissioner determines that a taxpayer received unreported income, the determination in the notice of deficiency must be “supported by ‘some evidentiary foundatio

When a taxpayer fails to provide adequate records substantiating income, the Commissioner is authorized to reconstruct the taxpayer’s income by using any reasonable method that clearly reflects income, including an indirect method. Sec. 446(b); Holland v. United States, 348 U.S. 121 (1954). The reconstruction need only be reasonable in lig

vising the Court of petitioner’s “newly-revealed” interpretation of the Internal Revenue Code and supporting regulations, i.e., that, under regulations interpreting section 861, “remuneration for services earned in the United States by a United States citizen from a United States employer was not an operative source of gross income under IRS [IRC] Section 61, and hence exempt income.” Notwithstanding such new interpretation (hereafter, sometimes, the 861 argument), Mr.

Title 26 Section 61 through 80, inclusive, to U..S.C.

The Commissioner may use any reasonable means to reconstruct a taxpayer’s income. Counts v. Commissioner, 774 F.2d 426, 428 (11th Cir. 1985), affg. T.C. Memo. 1984-561. When the Commissioner determines that a taxpayer received unreported income, the determination in the notice of deficiency must be “supported by ‘some evidentiary foundatio

For that proposition, petitioners reference section 61 and cases, including Commissioner v.

Section 165(d) provides that "Losses from wagering transactions shall be allowed only to the extent of the gains from such transactions." Sec.

Taxability of Amount Received Section 61 defines gross income as all income from whatever source derived.

Title 26 Section 61 through 80, inclusive, to U.S.C.

Title 26 Section 61 through 80, inclusive, to U.S.C.

0) (rejecting claim that income is not subject to tax because it is not from any of the sources listed in sec. 1.861-8(a), Income Tax Regs.); Aiello v. Commissioner, T.C. Memo. 1995-40 (rejecting claim that the only sources of income for purposes of sec. 61 are listed in sec. 861); Great-West Life Assur. Co. v. United States, 230 Ct. Cl. 477, 678 F.2d 180, 183 (1982) (“The determination of where income is derived or ‘sourced’ is generally of no moment to either United States citizens or United S

Ohio 1998).] - 8 - through 1996, arguing that the term “income” in section 61 encompasses only corporate income.

61; McClanahan v. United States, 292 F.2d 630, 631-632 (5th Cir. 1961). In the case of a taxpayer not engaged in the trade or business of gambling, gambling losses are allowable as an itemized deduction, but only to the extent of gains from such transactions. See sec. 165(d); McClanahan v. United States, supra; Winkler v. United States, 230 F.

Title 26 Section 61 through 80, inclusive, to U.S.C.

OPINION Section 61 defines gross income as all income from whatever source derived. Gross income includes compensation for services and interest. Sec. 61(a)(1), (4). Petitioner does not challenge the facts on which respondent’s determinations are based or respondent’s calculation - 3 - of tax.2 Petitioner stipulated that during 1996 he received compensati

Respondent’s determination is generally presumed correct, and petitioners have the burden of proof.3 Welch v. Helvering, 290 U.S. 111, 115 (1933). Petitioners contend that respondent’s determinations relating to unreported income are arbitrary and not entitled to a presumption of correctness. We disagree. Connecting petitioners to the fund

Title 26 Section 61 through 80, inclusive, to U.S.C.

330, 334 n.4 (1984) (describing the scope of the gift tax to be analogous in breadth to the definition of gross income contained in section 61); Commissioner v.

330, 334 n.4 (1984) (describing the scope of the gift tax to be analogous in breadth to the definition of gross income contained in section 61); Commissioner v.

330, 334 n.4 (1984) (describing the scope of the gift tax to be analogous in breadth to the definition of gross income contained in section 61); Commissioner v.

330, 334 n.4 (1984) (describing the scope of the gift tax to be analogous in breadth to the definition of gross income contained in section 61); Commissioner v.

Title 26 Section 61 through 80, inclusive, to U.S.C.

Exclusion for Damages Section 61 defines gross income as “all income from whatever source derived”.

Title 26 Section 61 through 80, inclusive, to U.S.C.

Title 26 Section 61 through 80, inclusive, to U.S.C.

Title 26 Section 61 through 80, inclusive, to U.S.C.

vising the Court of petitioner’s “newly-revealed” interpretation of the Internal Revenue Code and supporting regulations; i.e., that, under regulations interpreting section 861, “remuneration for services earned in the United States by a United States citizen from a United States employer was not an operative source of gross income under IRS [IRC] Section 61, and hence exempt income.” Notwithstanding such new interpretation (hereafter, sometimes, the 861 argument), Mr.

They may consist of one or more items of gross income enumerated in section 61, such as compensation for services, gross income derived from business, gains derived from dealings in property, interest, rents, royalties, dividends, etc.

For that proposition, petitioners reference section 61 and cases, including Commissioner v.

Section 61 is invalid because it defines “gross income” by using the word “income”. - 4 - 6. Section 6702(b) states that the penalty imposed by subsection (a) shall be in addition to some other penalty being imposed, thus it cannot be imposed alone. B. The Lien and Levy Proceeding Petitioners received a “Final Notice - Notice of Intent to Levy & Y

. 263, 277 (1946), affd. 168 F.23 994 (6th Cir. 1948) , we concluded that "'Gross income' has a wel L established meaning in the revenue laws, denoting statutor 33ross income as defined by section 22 [of the Revenue Act of 193 predecessor of present sec. 61] ." In enactin the Interna Revenue Code of 1954, the Congress added clause (i) to sec on - 37 - 6501(e)(1) (A) to modify the definition of gross income in the case of trades or businesses. Except for that modification, "the general definition

Section 104(a)(2) provides that gross income does not include “the amount of any damages received (whether by suit or by agreement * * * ) on account of personal injuries or sickness”.

No items of a trust shall be included in computing the taxable income and credits of the grantor or of any other person solely on the grounds of his dominion and control over the trust under section 61 (relating to definition of gross income) or any other provision of this title, except as specified in this subpart.

The court reasoned that the judgment in the wrongful termination action was fully includable in the taxpayer's gross income under the broad sweep of section 61, which defines gross income as "all income from whatever source derived" and the taxpayers had "simply used a portion of the award subsequently to discharge their personal liability to their attorneys." Id.

Based on the bank deposit analysis, gross re- ceipts are accepted as reported per IRC Section 61 provisions.

6654 1994 $3,361 $ 616 $123 1995 4,738 1,080 232 1996 1,504 331 --- The issues for decision are: (1) Whether petitioner, under section 61, is liable for Federal income taxes on income of $26,457, $31,759, and $15,937, respectively, for 1994, 1995, and 1996; (2) if so, whether petitioner is entitled to itemized deductions in excess of amounts conceded by respondent at trial; and (3) whether petitioner is liable for the additions to tax shown above.2 Some of the facts were s

61.08(1) (West 1997).14 Under Florida law, lump- sum alimony is essentially the payment of a definite sum (which may be paid in installments). See Mann v. Commissioner, 74 T.C. 1249, 1260 (1980); see also Canakaris v. Canakaris, 382 So.2d 1197, 1201 (Fla. 1980). Lump-sum alimony creates a vested right which survives death. See Mann v. Commissi

No items of a trust shall be included in computing the taxable income and credits of the grantor or of any other person solely on the grounds of his dominion and control over the trust under section 61 (relating to definition of gross income) or any other provision of this title, except as specified in this sub-part.

. 263, 277 (1946), affd. 168 F.2d 994 (6th Cir. 1948), we concluded that ‘“Gross income’ has a well-established meaning in the revenue laws, denoting statutory gross income as defined by section 22 [of the Revenue Act of 1938, predecessor of present sec. 61].” In enacting the Internal Revenue Code of 1954, the Congress added clause (i) to section 6501(e)(1)(A) to modify the definition of gross income in the case of trades or businesses. Except for that modification, “the general definition of gr

penses within the BERVED JUN 3 0 2000 - 2 - meaning of sec. 1341, I.R.C., and, therefore, P is not entitled to the beneficial treatment of sec. 1341. 2. Held, further, overcollections for fuel and energy conservation costs are not income to P under sec. 61 because U acquired funds subject to an unconditional obligation to repay. David E. Jacobson and Richard P. Swanson, for petitioner. James F. Kearney, for respondent. OPINION COHEN, Judge: Respondent determined deficiencies in petitioner's cons

Moreover, it is clear under section 61 that an “item” is gross income from a particular source, including pensions (the type of omitted income involved in this case).

In accordance with Internal Revenue Code section 61 income from whatever source is taxable.

The only citation of any legal authority by either party appears in respondent's opening brief, which cites without elaboration section 61 for the proposition that petitioners had unreported income from the gas rebate payments.

In accordance with Internal Revenue Code section 61 income from whatever source is taxable.

Section 61 defines gross income as all income from whatever source derived. With respect to an S corporation, section 1366(a) provides that in determining a shareholder's tax liability, there shall be taken into account the shareholder's pro rata share of the corporation's items of income and deduction. A shareholder's pro rata share of any item fo

Section 61 includes in gross income all income from whatever source derived. This section is broadly constructed, and any statutory exclusions from income must be narrowly construed. See Commissioner v. Schleier, 515 U.S. 323, 328 (1995). Section 104(a)(2) provides an exclusion for damages paid as compensation for personal injuries or sickness. If

Section 61 defines gross income to mean all income from whatever source derived, including alimony payments. Sec. 61(a)(8). Whether a payment constitutes alimony within the meaning of section 61(a)(8) is determined by reference to section 71. Section 71(a) provides that there shall be included in gross income any amount received as alimony. Section

Petitioner also argued, among other things, that (1) section 61 does not define taxable income; (2) he is not liable for the addition to tax under section 6651(a)(1) because he has not engaged in the collection of taxes on alcohol, tobacco, and/or firearms; and (3) he is not liable for the addition to tax under section 6654 because he had no knowledge that he qualified as a “person” subject to pay es

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-430 (1955). Petitioners’ settlement proceeds constitute gross income unless expressly excepted by another Code provision. See Commissioner v. Schleier, 515 U.S. 323, 328 (1995); Rozpad v. Commissioner, 154 F.3d 1, 3 (1st Cir. 1998), affg. T.C. Memo. 1997-528. - 13 - Pursuant to section

OPINION Under section 61, gross income includes all income from whatever source derived.

Section 61 defines gross income as all income from whatever source derived. With respect to an S corporation, section 1366(a) provides that in determining a shareholder's tax liability, there shall be taken into account the shareholder's pro rata share of the corporation's items of income and deduction. A shareholder's pro rata share of any item fo

Deficiency Issue General Rules As a general rule, section 61 defines gross income as “all income from whatever source derived”.

Commissioner, 60 T.C. 368, 407-409 (1973), affd. 519 - 9 - F.2d 1280 (10th Cir. 1975). These payments were for petitioners' personal benefit, and, accordingly, are income. B. Payments From Whittington, Inc., and Lovejoy In 1985, Ray received three $1,750 checks from Whittington, Inc., and Larry received six $1,750 checks from Lov

Commissioner, 60 T.C. 368, 407-409 (1973), affd. 519 - 9 - F.2d 1280 (10th Cir. 1975). These payments were for petitioners' personal benefit, and, accordingly, are income. B. Payments From Whittington, Inc., and Lovejoy In 1985, Ray received three $1,750 checks from Whittington, Inc., and Larry received six $1,750 checks from Lov

OPINION Under section 61, gross income includes all income from whatever source derived.

Section 61 includes in gross income all income from whatever source derived. This section is broadly constructed, and any statutory exclusions from income must be narrowly construed. See Commissioner v. Schleier, 515 U.S. 323, 328 (1995). Section 104(a)(2) provides an exclusion for damages paid as compensation for personal injuries or sickness. If

Moreover, it is clear under section 61 that an “item” is gross income from a particular source, including pensions (the type of omitted income involved in this case).

(1) Whether one of petitioner’s subsidiaries is entitled to compute its tax liability for 1987 and 1988 pursuant to section 1341 and (2) whether funds overcollected pursuant to fuel and energy conservation cost recovery rates constitute income under section 61. Unless otherwise indicated, all section references are to the Internal Revenue Code in effect for the years in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure. Background The parties submitted this case

ntory $ XXX Purchases of inventory XXX Production costs incurred XXX Total cost of goods available for sale XXX Less: Ending inventory XXX Cost of goods sold $ XXX Gross receipts from sales $ XXX Less: Cost of goods sold XXX Gross income from sales (sec. 61) $ XXX It can be seen from the foregoing equation that the amount of a taxpayer’s ending inventory and cost of goods sold both have a very direct effect on the amount of the taxpayer’s gross income from sales; however, those effects are exert

OPINION Section 61 defines gross income as all income from whatever source derived. Gross income includes compensation for services. See sec. 61(a)(1). Unless certain exceptions apply, prizes, awards, and any amount received from an annuity (including a retirement plan) are gross income. See secs. 72, 74. In general, the Commissioner's determinations in a

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

Section 61 defines, in a general manner, gross income as "all income from whatever source derived". Section 61(a)(12) further elaborates on this broad language by providing that gross income specifically includes amounts received from cancellation of indebtedness. A taxpayer may realize COD income by paying an obligation at less than its face value

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

corporation's earnings and profits are reduced by, among other things, the amount of money distributed with respect to its stock. Earnings and profits for a particular period include tax-exempt income, as well as items included in gross income under section 61. Sec. 1.312-6, Income Tax Regs. We are required to make a finding as to whether AJF had sufficient earnings and profits to sustain a dividend. DiZenzo v. Commissioner, supra at 127 (remanding to the Tax Court - 2288 - to make a finding wit

OPINION Section 61 defines gross income as all income from whatever source derived.

Section 61 defines gross income as all income from whatever source derived. With respect to a partnership, each partner shall take into account separately his or her distributive share of the partnership's taxable income or loss. See secs. 3 Notices of deficiency were issued by respondent to each of petitioner's sisters, making adjustments to incom

Under section 61, gross income is defined as "all income from whatever source derived". This includes unlawful earnings. Accordingly, when a taxpayer acquires embezzlement proceeds, without the consensual recognition of an obligation to repay and without restriction as to disposition, he has income that he is required to report. James v. United States, 3

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

- 3 - OPINION Section 61 defines gross income as all income from whatever source derived.

le to such individual. Individual tax returns are due on or before the 15th day of the fourth month following the close of the tax year. See sec. 1.6072-1(a), Income Tax Regs. The term "gross income" means "all income from whatever source derived." Sec. 61. The exemption amounts applicable to petitioner for the tax years 1993 and 1994 were $2,350 and $2,450, respectively. See sec. 151(d). The standard deduction amounts applicable to petitioner for tax years 1993 and 1994 were $3,700 and $3,800,

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

Section 61 includes in gross income all income from whatever source derived. However, section 104(a)(2) provides that the amount of damages received (whether by suit or agreement) on account of personal injuries or sickness is not included in gross income. The damages referred to are based upon tort or tort type rights. See sec. 1.104-1(c), Income

Section 61 includes in gross income all income from whatever source derived. However, section 104(a)(2) provides that the amount of damages received (whether by suit or agreement) on account of personal injuries or sickness is not included in gross income. The damages referred to are based upon tort or tort type rights. See sec. 1.104-1(c), Income

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

the assignment of income doctrine articulated in Lucas v. Earl, 281 U.S. 111, 115 (1930), and its progeny. The amounts received by the corporations were for services rendered by petitioners to the Five and should be includable in their income under section 61. See United States v. Basye, 410 U.S. 441, 450 (1973). 3. Section 482 Finally, even if the corporations had been viable entities, we do not think respondent's reallocation under section 482 was unreasonable, arbitrary, or capricious. - 278

Under section 61, gross income includes all income from whatever source derived. See Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). Respondent relies on this general proposition in treating as taxable income the funds the partnership and petitioner received in 1989 and 1990 from Peoria and College Park. Generally, however, gross income doe

are not deductible by Mr. Lovejoy under section 215. Our holding in this opinion will be incorporated into the decisions to be entered in these cases when all other issues are resolved. An appropriate order will be issued. 9Respondent did not raise sec. 61 as an alternative ground for including the unallocated payments in Ms. Miller's income. See, e.g., Mass v. Commissioner, 81 T.C. 112 (1983). But cf. Gould v. Gould, 245 U.S. 151 (1917) (alimony not includable in recipient's gross income under

corporation's earnings and profits are reduced by, among other things, the amount of money distributed with respect to its stock. Earnings and profits for a particular period include tax-exempt income, as well as items included in gross income under section 61. Sec. 1.312-6, Income Tax Regs. We are required to make a finding as to whether AJF had sufficient earnings and profits to sustain a dividend. DiZenzo v. Commissioner, supra at 127 (remanding to the Tax Court - 2244 - to make a finding wit

. $XXX Purchases of inventory. XXX Production costs incurred. XXX Total cost of goods available for sale . XXX Less: Ending inventory . XXX Cost of goods sold. XXX Gross receipts from sales. XXX Less: Cost of goods sold. XXX Gross income from sales (sec. 61). XXX It can be seen from the foregoing equation that the amount of a taxpayer’s ending inventory and cost of goods sold both have a very direct effect on the amount of the taxpayer’s gross income from sales; however, those effects are exerte

Section 61 broadly defines gross income as all income from whatever source derived. Any exclusion of items from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 328 (1995). Section 104(a)(2) provides that gross income does not include "the amount of any damages received (whether by suit or by agreement * * * ) on account o

Petitioner’s argument as to why the determined items were not income to him may be summarized as follows: (1) The section 61 definition of income is inconsistent with Supreme Court opinions that contain the statement that income equates with the concept of profit, and petitioner contends that his exchange of services for wages or compensation is not a profit situation.

In view of the all inclusive language of section 61, exclusions from income are matters of legislative grace and are construed narrowly.

- 7 - Section 61 defines gross income to mean all income from whatever source derived, including alimony or separate maintenance payments. Sec. 61(a)(8). Whether a payment constitutes alimony or separate maintenance within the meaning of section 61(a)(8) is determined by reference to section 71. Section 71(a) generally provides that gross income includes

61.08 (West 1985). Clearly, in this case, petitioner was the financially disadvantaged spouse. Under Florida law, Dr. Ibach was obligated to make payments to petitioner for her support. We believe he did so pursuant to Paragraph 7. Moreover, there was an equitable property division between petitioner and Dr. Ibach. Excluding the Paragraph 7 pa

An income tax may not be imposed on a loss without violating IRC § 61 and the Due Process Clause of the Fifth Amendment.

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-430 (1955). Although section 61(a) is to be broadly construed, statutory exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 327-328 (1995). Pursuant to section 104(a)(2), gross income does not include "the amount of any damages received (whether b

61; Conmissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). The .Supreme Court in Old Colony Trust Co. v. Commissioner, 279 U.S. 716, 729 (1929), stated that "The discharge by a third person of an obligation to him is equivalent to receipt by the person taxed." See also United States v. Boston & Me. R.R., 279 U.S. 732, 734 (1929). In ADEA cas

Section 61 defines, in a general manner, gross income as "all income from whatever source derived". Section 61(a)(12) further elaborates on this broad language by providing that gross income specifically includes amounts received from cancellation of indebtedness. A taxpayer may realize COD income by paying an obligation at less than its face value

(1) no deduction otherwise allowable under this chapter because of the rental use of such dwelling unit shall be allowed, and (2) the income derived from such use for the taxable year shall not be included in the gross income of such taxpayer under section 61. Petitioners have the burden of proving their entitlement to the exclusion found in section 280A(g). Rule 142(a); Welch v. Helvering, 290 U.S. 111 (1933). In essence, petitioners argue that the $12,000 received from Roy Farms in both 1992

Section 61 broadly defines gross income as all income from whatever source derived. Any exclusion of items from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 328 (1995). Section 104(a)(2) provides that gross income does not include "the amount of any damages received (whether by suit or by agreement * * * ) on account o

- 38 - Section 61 includes in income "all income from whatever source derived", including income from an illegal source. James v. United States, 366 U.S. 213, 219-220 (1961); Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). It is well settled that money obtained by means of embezzlement constitutes income to the perpetrator. Money received wi

Section 61 broadly defines gross income as all income from whatever source derived. Any exclusion of items from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 328 (1995). Section 104(a)(2) provides that gross income does not include "the amount of any damages received (whether by suit or by agreement * * * ) on account o

403, 407 (1984) (stating that gross income under section 61 means all income from whatever source derived); Rowlee v.

Section 61 defines gross income as "all income from whatever source derived". This definition includes all "accessions to wealth, clearly realized, and over which the taxpayers have complete dominion." Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). Proof of omitted income by direct means is extremely difficult and often impossible fo

t it and the rights and remedies thereunder were to inure to the benefit of and were to be binding upon the heirs, successors, and assignees to the parties thereto. The letter agreement provided in pertinent part: If the change currently proposed in Section 61 of H.R. 4170 (Tax Reform Act of 1984) is enacted, or if other United States federal tax legislation is enacted relat- ing to the relationship between voting power and equity ownership and having a similar effect on Amax's ability to includ

Petitioner admits that during 1993 Mrs. Schroeder received wages in the amount of $170 from the DuPage County Board of Election Commissioners. Petitioner does not contend that this amount is excludable from gross income, and he has not established that this amount was included in gross income reported on his joint return for 1993. Responde

Section 61 defines gross income as income from whatever source derived. The Supreme Court has held that when earnings are acquired, lawfully or unlawfully, without a consensual recognition of an obligation to repay, there is income to the taxpayer. James v. United States, 366 U.S. 213, 219 (1961). In James, the Supreme Court stated that "This stand

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). While section 61(a) is to be broadly construed, statutory exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. ___, 115 S. Ct. 2159, 2163 (1995). Under section 104(a)(2), gross income does not include "the amount of any damages received (whether by su

4(a)(2) does not. Petitioner does not point to, and we - 7 - are unaware of, any other section providing such an exemption under these facts. Regardless of how the amount received from IBM is characterized, it cannot escape the broad provisions of section 61. Respondent also determined that petitioners are liable for an accuracy-related penalty under section 6662(a) for a substantial underpayment of tax. Section 6662(a) imposes a penalty in an amount equal to 20 percent of the portion of an unde

Section 61 defines gross income to mean all income from whatever source derived, including rents. Sec. 61(a)(5). If a lessee places improvements on real estate which constitute in whole or part a substitute for rent, such improvements constitute rental income to the lessor. Sec. 1.61-8(c), Income Tax Regs. Whether or not improvements made by a less

Section 61 broadly defines gross income to include all income from whatever source derived, except as otherwise provided. Statutory exclusions from income are narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 328 (1995). Section 104(a)(2) provides that gross income does not include "the amount of any damages received (whether by suit or

United States, 366 U.S. 213 (1961); Rutkin v. United States, 343 U.S. 130 (1952); United States v. Rosenthal, 470 F.2d 837 (2d Cir. 1972); Moore v. United States, 412 F.2d 974 (5th Cir. 1969); Peters v. Commissioner, 51 T.C. 226 (1968); McSpadden v. Commissioner, 50 T.C. 478 (1968). Generally, check kiting does not produce taxable

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). While section 61(a) is to be broadly construed, statutory exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. ___, 115 S. Ct. 2159, 2163 (1995). Under section 104(a)(2), gross income does not include "the amount of any damages received (whether by su

Petitioners further note that under section 61 gross income means all income "whether received in the form of money, property, or services." Therefore, according to petitioners, a deductible expense should include any expenditure made "in the form of money, property, or services." Petitioners support their contention that the value of services is deductible under section 162 by notin

Under section 61, gross income includes "all income from whatever source derived." Gross income includes funds derived from legal and illegal sources. Rutkin v. United States, 343 U.S. 130 (1952). Where a taxpayer keeps no books or records, or fails to file a return from which his income tax liability can be assessed, the Internal Revenue Service (IRS) m

rtain exceptions,4 Mr. Yoon converted the proceeds to his own use without petitioner's knowledge. We conclude, therefore, that the settlement checks cashed without petitioner's knowledge did not constitute income to petitioner within the meaning of section 61. Cf. Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 431 (1955). The Mitsui Manufacturers Bank Client Trust Account 4 Petitioner admits that he authorized Mr. Yoon to cash certain of the disputed checks, namely items 1, 2, 9, 13, 15 and 1

She further admitted not filing a tax return for 1990 and justified her failure to file by stating: "I don't believe that a person that's working as hard [as I] for as small a wage as I should have to pay tax." Section 61 defines gross income as all income from whatever source derived.

Under section 61, gross income includes "all income from whatever source derived." Gross income includes funds derived from legal and illegal sources. Rutkin v. United States, 343 U.S. 130 (1952). Where a taxpayer keeps no books and records, or the taxpayer fails to file a return from which his income tax liability can be assessed, the IRS may reconstruc

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426, 429-430 (1955). Although section 61(a) is to be broadly construed, statutory exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. 323, 327-328 (1995). Pursuant to section 104(a)(2), gross income does not include "the amount of any damages received (whether b

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). Although section 61(a) is to be broadly construed, statutory exclusions from income must be narrowly - 6 - construed. Commissioner v. Schleier, 515 U.S. ___, , 115 S. Ct. 2159, 2163 (1995). Pursuant to section 104(a)(2), gross income does not include "the amount of any damages recei

Section 61 defines gross income as income from whatever source derived. The Supreme Court has held that when earnings are acquired, lawfully or unlawfully, without a consensual recognition of an obligation to repay, there is income to the taxpayer. James v. United States, 366 U.S. 213, 219 (1961). - 10 - In James, the Court stated that "This stand

61; Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). Although section 61(a) is to be broadly construed, statutory exclusions from income must be narrowly construed. Commissioner v. Schleier, 515 U.S. , , 115 S. Ct. 2159, 2163 (1995). Pursuant to section 104(a)(2), gross income does not include "the amount of any damages received (wheth

61.14 (West 1985)]. This statute has since been amended. See Fla. Stat. Ann. sec. 61.14 (West Supp. 1997). - 25 - agree. John's position in the Florida courts was not that there were no support provisions in the agreement; rather, John made a legal argument that the agreement was nonmodifiable because it contained support provisions and a com

He had complete and unfettered use of the skimmed proceeds, and therefore the receipt of the skimmed proceeds constituted income within the meaning of section 61.3 Issue 2.

The Supreme Court has consistently held that section 61 subjects to taxation all accessions to wealth that are clearly realized over which a taxpayer has complete dominion and control, unless specifically excluded by statute.

1.61-1(a), Income Tax Regs.; see also Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955). Gross income does not include the amount of reimbursed trade or business expenses of employees that qualify under an accountable plan. Sec. 62; sec. 1.62-2(c)(2), (4), Income Tax Regs. An accountable plan is one in which (1) the reimbursed e

Section 61 defines gross income to include "all income from whatever source derived". Section 61(a)(4) specifically provides that gross income includes "interest". Section 104(a)(2) provides for the exclusion of "the amount of any damages received - 7 - (whether by suit or agreement and whether as lump sums or as periodic payments) on account of p

Embezzlement Income Section 61 defines gross income as income from whatever source derived.

* * * Discussion Section 61 defines gross income to mean income from whatever source derived, including alimony or separate maintenance payments.

Section 61 defines gross income as income from whatever source derived, including dividends. Sec. 61(a)(7). In general, the term "dividend" means any distribution of property made by a corporation out of its earnings and profits of the taxable year or out of its accumulated earnings and profits. Sec. 316(a). The portion of a distribution of propert

Section 61 defines gross income to mean all income from whatever source derived, including rents. Sec. 61(a)(5). If a lessee places improvements on real estate which constitute in whole or part a substitute for rent, such improvements constitute rental income to the lessor. Sec. 1.61-8(c), Income Tax Regs. Whether or not improvements made by a less

Per diem payments, however, may be excluded from income if the requirements of section 1.162-17(b)(1), Income Tax Regs., are met. The employee need not report on his tax return (either itemized or in total amount) expenses for travel, transportation, entertainment, and similar purposes paid or incurred by him solely for the benefit of his

Section 61 defines gross income as all income from whatever source derived. Included within the definition of gross income is "Gains derived from dealings in property". Sec. 61(a)(3). However, expenses paid in connection with the disposition of real property ordinarily are capital expenditures which must be offset against the selling price in deter

* * * The regulations under * * * the - 13 - predecessor of * * * [section 61] provided that: "In the case of a manufacturing, merchandising, or mining business, 'gross income' means the total sales, less cost of goods sold, plus any income from investments and from incidental income or outside operations." * * * Currently, I.R.C.

Under section 61, gross income includes "all income from whatever source derived." Where a taxpayer keeps no books and records, or the taxpayer fails to file a return from which his - 14 - income tax liability can be assessed, respondent may reconstruct the taxpayer's income by using any method that, in the opinion of respondent, clearly reflects income

Compensation for services constitutes income within the meaning of section 61 regardless of whether the income was earned as an employee or from self-employment, section 61(a)(1) and (2), and such income is subject to the tax imposed by section 1.

hole or in part, the exclusion provided for by the statute. But - 16 - it is no more appropriate to conclude that this cost adjustment "changes the amount excluded" than to say that section 162 or section 263A "changes" the treatment of items under section 61. Thus, if the premise of the Regulation is correct, there is no conflict. Petitioners' contention that there is a conflict depends upon proof that the amount of gross income that may be excluded is equal to the full "amount excluded" of sec

13 - Accordingly, respondent contends that the alleged embezzled funds constitute gross income to petitioners in the year of embezzlement. It is well established that profits or gains earned illegally constitute gross income within the meaning of section 61. James v. United States, 366 U.S. 213 (1961). Embezzled funds, therefore, constitute income to the embezzler. Id. In James, the Supreme Court explained that a taxpayer has income when he or she "acquires earnings, lawfully or unlawfully, wit

Diverted Dealership Income Section 61 defines gross income to mean all income from whatever source derived.

Under section 61, gross income includes "all income from whatever source derived." It is well established that stolen funds are includable in the year in which they are misappropriated. James v. Commissioner, 366 U.S. 213, 219-220 (1961); Lydon v. Commissioner, 351 F.2d 539, 545 (7th Cir. 1965), affg. T.C. Memo. 1964-27. As a general rule, petitioner has

etween petitioners' claimed "gross income from the property" for purposes of depletion and petitioners' actual gross receipts from the sales of the natural gas at issue was not included in Exxon's 1979 gross income or taxable income for purposes of section 61 or 63. Respondent conceded solely for purposes of respondent's motion several facts which involve other issues related to percentage depletion that respondent apparently believes might have required us to deny respondent's motion because of

between petitioners’ claimed “gross income from the property” for purposes of depletion and petitioners’ actual gross receipts from the sales of the natural gas at issue was not included in Exxon’s 1979 gross income or taxable income for purposes of section 61 or 63. Respondent conceded solely for purposes of respondent’s motion several facts which involve other issues related to percentage depletion that respondent apparently believes might have required us to deny respondent’s motion because o

fining; (6) whether in fact the crude oil pricing restriction(s) imposed by Saudi Arabia was/were (cid:16)042observed by petitioners and their offtakers; (7) if a crude oil pricing restriction(s) existed and petitioners and their offtakers observed the restriction(s), whether or not the pricing restriction(s) precludes or preclude a section 482 or section 61 adjustment to petitioners' income.