1.61-14, “treasure trove, to the extent of its value in United States currency, constitutes gross income for the taxable year in which it is reduced to undisputed possession.” Therefore the United States is not barred by the statute of limitations from collecting the $836.51 in tax in 1964. The $4,467.00 was not “reduced to undisputed possession” until actual discovery in 1964. English common-law rule states that “title belongs to the finder as against all the world except the true owner.” Thus, Plaintiffs must have actually found the money to have superior title over all but the true owner. Ohio does not have a statute dealing with the rights of owners and finders of treasure trove, thus the English common-law rule applies. Problems of when title vests, or when possession is complete, as it relates to federal taxation and in the absence of definitive federal legislation, is determined by state law. The monies were properly included as gross income for the calendar year of 1964. Thus, the monies found in the piano constituted gross income. Plaintiffs were unable to point to any inconsistencies between the gross income sections of the Code, the interpretation of them by the regulations and the courts, and the revenue rulings. Third, other courts and commentators have taken the position that windfalls, including found monies, were properly includable in gross income under Section 22(a) of the 1939 Code, which is the predecessor of Section 61(a) in the 1954/1986 Code. First, an IRS Revenue Ruling states, “the finder of treasure trove is in receipt of taxable income, for Federal income tax purposes, to the extent of its value in United States currency, for the taxable year in which it is reduced to undisputed possession.” Second, numerous Supreme Court cases recognize the broad sweeping construction of Section 61(a) found in Treas. The monies in the piano are includable as gross income for three reasons. Plaintiffs are not entitled to a refund, nor are they entitled to capital gains treatment. The receipt of the monies constituted gross income in 1964, the year in which the funds were reduced to undisputed possession.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |