- 10 -
on August 28, 1983, Mr. Erickson paid him "a lot of money",
which he estimated may have been more than $1 million.
Petitioner filed a timely Federal income tax return
for 1983. On his return, petitioner reported adjusted
gross income of $53,504.99, consisting primarily of wages
from his employment with the Key Container Corp. in
Pawtucket, Rhode Island. Petitioner did not report any
income from the sale of marijuana on his 1983 return,
and he did not inform his return preparer of the Michigan
transaction or the existence or extent of the income
realized from the transaction.
OPINION
Unreported Income
As a general rule, gross income includes "all income
from whatever source derived". Sec. 61(a). This includes
income obtained from illegal sources. See James v. United
States, 366 U.S. 213 (1961); Browning v. Commissioner, T.C.
Memo. 1991-93; sec. 1.61-14(a), Income Tax Regs.
Respondent determined that petitioner realized $3,158,000
of unreported income in 1983 from the sale of marijuana.
Petitioner, on the other hand, maintains that he did not
realize any such income.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011