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property. Until a statutorily supported rebuttal to
this allegation can be mounted by the Respondent,
Petitioner is due a full return of all amounts imposed
upon Petitioner's compensation which was received under
contract.
* * * * * * *
To comply with � 7701(e) therefore, the value or
cost of the services (FMV) should be allowed as a
deduction under � 212. * * * When Petitioner performs
this deduction, he has no taxable income. How has the
Respondent allowed the Petitioner this deduction? Why
is this "cost" not deductible?
Internal Revenue Code section 83[3] applies to ANY
compensation income * * * . It serves to deduct the
taxpayer's cost, the value of the labor, from that
which can be treated as gross income * * * .
* * * * * * *
Knowing that services (labor) are property * * * ,
nothing excludes services from the provisions of �
1012[4] as a cost that must be restored to the
3 Sec. 83 provides in part as follows:
SEC. 83. PROPERTY TRANSFERRED IN CONNECTION WITH
PERFORMANCE OF SERVICES.
(a) General Rule.--If, in connection with the
performance of services, property is transferred to any
person other than the person for whom such services are
performed, the excess of--
(1) the fair market value of such property *
* * over
(2) the amount (if any) paid for such
property,
shall be included in the gross income of the person who
performed such services * * * . [Emphasis added.]
4 Sec. 1012 provides in part as follows:
(continued...)
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