Virtual Income, Land Barons, and the IRS

Not initially.

Tax Court proceedings are quasi criminal cases. The tax debt is a civil liability, however the penalty for nonpayment evasion is a criminal penalty. It is the only area of law where the possible sanction for a civil debt liability can result in incarceration.

In the US when criminal charges are brought against a defendant, the prosecution has the initial burden of proof to prove all the elements of the crime. The accused does not have to say one word in her defense, nor does she have to prove her innocence.

In Tax Court, the burden of proof starts out on the other side. The Defendant, taxpayer, has the initial burden to prove he does not owe the debt for whatever reason. If the defendant meets that burden, then the burden shifts to the IRS to prove the tax is owed.

The initial presumption is that the taxpayer owes the tax.

This burden is stated in the US Code, Title 26, Section 7491 as follows:

26 U.S.C.§7491, Burden of proof

(a) Burden shifts where taxpayer produces credible evidence

(1) General rule
If, in any court proceeding, a taxpayer introduces credible evidence with respect to any factual issue relevant to ascertaining the liability of the taxpayer for any tax imposed by subtitle A or B, the Secretary shall have the burden of proof with respect to such issue.

(2) Limitations
Paragraph (1) shall apply with respect to an issue only if—

(A) the taxpayer has complied with the requirements under this title to substantiate any item;

(B) the taxpayer has maintained all records required under this title and has cooperated with reasonable requests by the Secretary for witnesses, information, documents, meetings, and interviews; and

(C) in the case of a partnership, corporation, or trust, the taxpayer is described in section 7430 (c)(4)(A)(ii).

Subparagraph (C) shall not apply to any qualified revocable trust (as defined in section 645 (b)(1)) with respect to liability for tax for any taxable year ending after the date of the decedent’s death and before the applicable date (as defined in section 645 (b)(2)).

(3) Coordination

Paragraph (1) shall not apply to any issue if any other provision of this title provides for a specific burden of proof with respect to such issue.

(b) Use of statistical information on unrelated taxpayers

In the case of an individual taxpayer, the Secretary shall have the burden of proof in any court proceeding with respect to any item of income which was reconstructed by the Secretary solely through the use of statistical information on unrelated taxpayers.

(c) Penalties

Notwithstanding any other provision of this title, the Secretary shall have the burden of production in any court proceeding with respect to the liability of any individual for any penalty, addition to tax, or additional amount imposed by this title.

I was talking about assets in the USA. (see prior posts about seizing telehub property and linden accounts.) Is it a joke? Maybe, who knows. I know a lot of people said the Justice Dept would not go after Martha Stewart for 50K, but Justice was looking for an example.

I know that the IRS is waiting for the right cases to test these kinds of issues. Who knows, maybe one day we will see members in world with the last name "IRS."

you should be aware of bar guidelines for tossing out this type of information on an Internet message board

Blah Blah Blah. More action less talk Katy. *yawn*

Now that is interesting... http://www.elawyering.org/tools/practices.shtml is a good reference for anyone (like myself) who never knew of such guidelines.

Are you a member of the ABA?

The basic guidelines include 1) Contact Information 2) Dating [of] Material 3) Jurisdiction Information 4) Limits of Legal Information 5) Links [to other resources] 6) Legal Citations 7) Referrals [to actual or extra advice] Permissions 9) Terms and Conditions and 10) a Privacy Statement. Now, Granted some apply directly to sites hosted and maintained by lawyers but I have to say many of these do seem to be applicable in this situation and you've seemed to neglect many of them ( at least 1, 3, 5 & 7). Were you aware that law advice or information online was held to a higher standard by the american bar association than a layman's communcation would be? Do you not care? Just curious.

Would I report this to the ABA? Maybe. Dont piss me off.

She hasn't told anyone specifically how to handle their affairs concerning taxes and the general information she has given was in the course of debate with many participants....you would be hard pressed to prove that she has given out any information that has been detrimental to any of the participants.....Just because she is a lawyer doesn't mean she can't discuss varying opinion on tax code.

Concerning a "Chinese woman in Germany who earns six figures a year speculating on Second Life real estate," nonresident aliens must file Form 1040NR if you are engaged in a trade or business in the United States, or have any other US source income on which the tax was not fully paid by an amount withheld. There is a public statement by Philip Rosedale of this income along with a lengthy self incriminating statement against interest posted here by one earning a significant amount of cash in SL.

I'm not so sure about that talen. Even in her very first post before any conversation began she specifically addressed a single players situation and attempted to "educate" her on exactly what she should do to follow the law. In fact, interestingly enough, Katykiwi even admits to it as fact, saying (and i quote) "Your reaction is odd considering that I gave you free legal advice about not publishing self incriminating statements" in response to a response to her original advice. Thats pretty darn clear.

I'm not so sure about that talen. Even in her very first post before any conversation began she specifically addressed a single players situation and attempted to "educate" her on exactly what she should do to follow the law. In fact, interestingly enough, Katykiwi even admits to it as fact, saying (and i quote) "Your reaction is odd considering that I gave you free legal advice about not publishing self incriminating statements" in response to a response to her original advice. Thats pretty darn clear that it was more than common discourse.

The misconception that everyone has is the fact that we have assigned a dollar value to Lindens based on 3rd party site agreements.

Hey as the richest person in SL she is being watched by the unwashed hordes. And maybe you are preaching on deaf ears.

What an insightful comment, Thanks! You obviously put a lot of thought into that! Welcome to SL!

Would more listen and agree if I malign our most heavily invested contributors and threaten people with contacting government agencies about things I have absolutely no proof of just to harass them with my own petty jealousies?

I'll try it out for a while and get back to you.

So this means your comming to my place next time so I dont have to hide under the bed right?

(((hugs)))

lolololololol

That was YOU under the bed? *mutters something about Cthulhu*

This is a very good topic for discussion.

Rather than give this thread a teleport into oblivion, or lock it so that it sinks into the briny depths, I'd like to give people a chance to get back "on topic" and avoid having this thread devolve into interpersonal conflict arguments.

<Path attempts to nudge the train back on the rails>

This is a very good topic for discussion.

Rather than give this thread a teleport into oblivion, or lock it so that it sinks into the briny depths, I'd like to give people a chance to get back "on topic" and avoid having this thread devolve into interpersonal conflict arguments.

<Path attempts to nudge the train back on the rails>

<stuff>

it's a grey area at best until the irs makes policy or a tax court rules, and people are better off talking to their own lawyers if they are concerned.

It turns out Linden Lab is searching for its very own Alan Greenspan. The company wants to hire an adviser to independently monitor the game's economy and recommend policy changes to keep it stable.

Could everyone possibly repeat their exact positions over again for those not willing read before this post? Apparently threads get locked or thrown away on a dime if they arent actively spewing flowers and happyness into the community. Lets start the coversation all over again so that doesn't happen. Can i have my authorized script, please, Pathfinder?

Its a miracle! *bows down before the mighty lindens*