Originally Posted by FL370esq (Post 2755898)

Ironically, income is and has been defined for a very long time but, for Federal Tax purposes, the IRS and tax lawyers always turn to the touchstone case Commr. v. Glenshaw Glass Co., 348 U.S. 426 (1955), which is probably the most important case in American tax law in that it defined "income" quite broadly. Glenshaw Glass established that income is:

"Any undeniable accession to wealth,
which is clearly realized by the taxpayer, over which the taxpayer has complete dominion."

If you paint a farmer's barn and the farmer pays you for that service with meat from half a cow, the value of the meat is income.

The issue(s) revolve(s) around what part and how much of that income is either exempt or deductible under the Federal Tax code. That's where the CPAs and tax lawyers make their $$$. 😁

Originally Posted by GogglesPisano (Post 2755811)

(perhaps some gradation for higher incomes.)

Originally Posted by Denny Crane (Post 2755943)

Your example sounds like the classic definition of “barter.” One is exchanging goods for services so both parties would have to file taxes based on the inputted income each side of the deal.......correct?

Denny

Originally Posted by JamesBond (Post 2755905)

Holy carp, how are some of you guys getting your taxes done already? I have 1099s that won't arrive until the end of Feb.

Originally Posted by JamesBond (Post 2755905)

Holy carp, how are some of you guys getting your taxes done already? I have 1099s that won't arrive until the end of Feb.

Originally Posted by Slaphappy (Post 2755599)

Honestly we would all be better off getting rid of all dedications and credits.

Originally Posted by LumberJack (Post 2755671)

Agreed. Close all loop holes and tax capitol gains like normal income.

Originally Posted by FL370esq (Post 2755980)

Well.....you've gone straight to a nuance of barter. 😁

Look at it this way. The farmer got his barn painted and, instead of paying cash to the painter, he paid with meat which the painter agreed was equal to the value of his services. Would you pay income tax on someone painting your house? I'm thinking no but you would pay income tax on money paid to you for performing a service. Now, if the farmer tilled the painter's back lot in exchange for the painter painting the farmer's barn, the mutual income issue becomes a player.

Originally Posted by Denny Crane (Post 2756146)

:) For the sake of argument ('cause I like a good argument!) What's the difference between the farmer tilling the painters back 40 and giving him the cow? I mean, that farmer raised that cow from a calf and has invested time and energy into it. That cow's probably worth a lot!!!:)

Denny

Originally Posted by FL370esq (Post 2756204)

Are we talking Angus, Longhorn, Waygu or Kobe? 😁

By trading the meat away, the farmer has no accession to wealth because, at the end, it's a zero sum game for him. He has less in his meat locker now in exchange for a painted barn so his overall wealth remains unchanged. If the farmer tills the painter's back 40, his meat locker remains unchanged - he has not given up anything (other than his time and effort) but his efforts got him a painted barn which is the exchange of a service for a service and therefore it becomes income valued at the fair market value of the service received.

Clear as mud?

If only the Super Bowl was as "exciting" as a Sunday evening tax discussion. 😁