According to IRS guidance, any income derived from illegal activity is taxable, and there’s no statute of limitations on when they can go after you.
by Joe Lancaster
Reason.com
As just about every American adult knows and is dreading, Monday, April 15, is Tax Day. Each year, taxpayers scrounge together each income statement the government requires and any random receipt that may result in a modest deduction in the amount they’re expected to pay.
The IRS wants taxpayers to know that if you made money from anything illegal last year—stealing, selling illegal drugs, taking bribes—then that’s taxable, too.
Last year, Americans spent 6.5 billion hours doing their taxes, which translates to roughly $260 billion in lost productivity. That’s in addition to the $104 billion they spent in direct costs on the actual tax filing and preparation.
Much of that complexity stems from the amount of deductions and carve-outs the tax law allows, as well as the types of revenue required to be treated as taxable income.