Any liberals capable of defending income tax laws?
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19-05-2014, 11:55 AM
RE: Any liberals capable of defending income tax laws?
(19-05-2014 11:04 AM)frankksj Wrote:  
(19-05-2014 10:56 AM)Chas Wrote:  No, that IRS rule does not say what you claim... It is not about private exchanges.

Sorry, Chas. Please re-read the IRS's own rules. It is clear and unambiguous:

Quote:"Bartering occurs when you exchange goods or services without exchanging money. An example of bartering is a plumber exchanging plumbing services for the dental services of a dentist. You must include in gross income in the year of receipt the fair market value of goods or services received from bartering.

They even gave a crystal clear example of exchanging plumbing and dental services. That's unquestionably a private exchange, just like exchanging lawn mowing and tutoring in my example.

That is not a private exchange, that is business to business. That is not neighbors swapping chores.

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19-05-2014, 11:56 AM (This post was last modified: 19-05-2014 12:08 PM by Chas.)
RE: Any liberals capable of defending income tax laws?
(19-05-2014 11:34 AM)frankksj Wrote:  
(19-05-2014 11:23 AM)Im_Ryan Wrote:  You're right, the rules are very clear. You quoted the first paragraph of the article, let me show you the third:

Come on. You must be trying REALLY hard NOT to understand it. It says the "TERM" (barter exchange) does not apply to noncommercial barters. It doesn't say noncommercial barters aren't taxable--the first paragraph makes it very clear that they are. It doesn't say "forget everything we just wrote in the first paragraph, we didn't mean it". No, all it says is that if do the barter on a larger scale, then IN ADDITION to paying taxes it, the barter exchange must ALSO file additional forms.

The rules are very, very clear.

Here's a case in point. Right now I'm staying in latin america. There's a homeless man I regularly pass while walking my dog, and he LOVES my dog, and my dog goes crazy over him. So, I offered a barter. I buy him lunch each day, and he takes my dog on a long walk each morning. All of us are better off. My dog is happy. I get to spend more time arguing politics in this forum. The homeless man gets a good meal every day. However, in the US, this _IS_ a crime. It's ok to give the homeless man just some food, although if you're the recipient of a large amount of charity you must report it. However, if we bartered like this and didn't report it, we are both committing a felony. The only way to be clear of the law is to either (a) both of us pay for the privilege of helping each other out, or (b) don't do anything for each other. There is no question that is the system and the way the laws work. They are crystal clear. I am asking for the moral justification for the system.

Sorry, no. That is your ever-present confirmation bias once again causing you to misconstrue plain English.

The second paragraph clarifies it:
"Generally, you report this income on Form 1040, Schedule C (PDF), Profit or Loss from Business or Form 1040, Schedule C-EZ (PDF), Net Profit from Business. If you failed to report this income, correct your return by filing a Form 1040X (PDF). Refer to Topic 308 for information on filing an amended return

IRS Publication 525

Bartering Wrote:Example 1.

You are a self-employed attorney who performs legal services for a client, a small corporation. The corporation gives you shares of its stock as payment for your services. You must include the fair market value of the shares in your income on Schedule C or Schedule C-EZ (Form 1040) in the year you receive them.

Example 2.

You are a self-employed accountant. You and a house painter are members of a barter club. Members get in touch with each other directly and bargain for the value of the services to be performed. In return for accounting services you provided, the house painter painted your home. You must report as your income on Schedule C or Schedule C-EZ (Form 1040) the fair market value of the house painting services you received. The house painter must include in income the fair market value of the accounting services you provided.

Example 3.

You are self-employed and a member of a barter club. The club uses credit units as a means of exchange. It adds credit units to your account for goods or services you provide to members, which you can use to purchase goods or services offered by other members of the barter club. The club subtracts credit units from your account when you receive goods or services from other members. You must include in your income the value of the credit units that are added to your account, even though you may not actually receive goods or services from other members until a later tax year.

Example 4.

You own a small apartment building. In return for 6 months rent-free use of an apartment, an artist gives you a work of art she created. You must report as rental income on Schedule E (Form 1040) the fair market value of the artwork, and the artist must report as income on Schedule C or Schedule C-EZ (Form 1040) the fair rental value of the apartment.

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19-05-2014, 12:06 PM
RE: Any liberals capable of defending income tax laws?
(19-05-2014 11:34 AM)frankksj Wrote:  
(19-05-2014 11:23 AM)Im_Ryan Wrote:  You're right, the rules are very clear. You quoted the first paragraph of the article, let me show you the third:

Come on. You must be trying REALLY hard NOT to understand it. It says the "TERM" (barter exchange) does not apply to noncommercial barters. It doesn't say noncommercial barters aren't taxable--the first paragraph makes it very clear that they are. It doesn't say "forget everything we just wrote in the first paragraph, we didn't mean it". No, all it says is that if do the barter on a larger scale, then IN ADDITION to paying taxes it, the barter exchange must ALSO file additional forms.

The rules are very, very clear.

Here's a case in point. Right now I'm staying in latin america. There's a homeless man I regularly pass while walking my dog, and he LOVES my dog, and my dog goes crazy over him. So, I offered a barter. I buy him lunch each day, and he takes my dog on a long walk each morning. All of us are better off. My dog is happy. I get to spend more time arguing politics in this forum. The homeless man gets a good meal every day. However, in the US, this _IS_ a crime. It's ok to give the homeless man just some food, although if you're the recipient of a large amount of charity you must report it. However, if we bartered like this and didn't report it, we are both committing a felony. The only way to be clear of the law is to either (a) both of us pay for the privilege of helping each other out, or (b) don't do anything for each other. There is no question that is the system and the way the laws work. They are crystal clear. I am asking for the moral justification for the system.

Quote:Bartering occurs when you exchange goods or services without exchanging money. An example of bartering is a plumber exchanging plumbing services for the dental services of a dentist. You must include in gross income in the year of receipt the fair market value of goods or services received from bartering.
Generally, you report this income on Form 1040, Schedule C (PDF), Profit or Loss from Business or Form 1040, Schedule C-EZ (PDF), Net Profit from Business. If you failed to report this income, correct your return by filing a Form 1040X (PDF). Refer to Topic 308 for information on filing an amended return.
A barter exchange is an organization with members who contract with each other (or with the barter exchange) to exchange property or services. The term does not include arrangements that provide solely for the informal exchange of similar services on a noncommercial basis.
The Internet has provided a medium for new growth in the bartering industry. This growth prompts the following reminder: Barter exchanges are required to file Form 1099-B (PDF), Proceeds From Broker and Barter Exchange Transactions, for all transactions unless an exception applies. Refer to Bartering in Publication 525, Taxable and Nontaxable Income, and the Form 1099-B Instructions, for additional information on this subject. Persons who do not contract with a barter exchange or who do not barter through a barter exchange, but who trade services, are not required to file Form 1099-B. However, they may be required to file Form 1099-MISC (PDF). If you exchange property or services through a barter exchange, you should receive a Form 1099-B. The IRS also will receive the same information. If you receive income from bartering, you may be required to make estimated tax payments. Refer to Form 1040-ES (PDF), Estimated Tax for Individuals, for more information.
If you are in a trade or business, you may be able to deduct certain costs you incur to perform services that you barter.
Refer to Publication 525, Taxable and Nontaxable Income, for additional information about bartering. Please refer to our Bartering Tax Center page for more information on bartering income and barter exchanges.

Consider

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19-05-2014, 12:48 PM
RE: Any liberals capable of defending income tax laws?
(19-05-2014 11:56 AM)Chas Wrote:  Sorry, no. That is your ever-present confirmation bias once again causing you to misconstrue plain English.

Chas, what specifically in the 2nd paragraph says that if a plumber and dentist exchange services it is NOT taxable? The 1st paragraph is crystal clear that it is, the 2nd paragraph just states what form to file if you do it. You are trying your hardest to find some bizarre meaning in what is a very clear, simple and obvious statement. It seems you'll do anything to avoid the pink elephant in the room, namely that no liberal will answer the questions in my OP. You guys will do anything to change the subject, including playing silly word games. Why not answer the questions?

Here is the text from IRS topic 420. No commentary needed. It speaks for itself. The other text you quoted related to barter clubs which only ADD more requirements, but in no way remove the tax on barter:

Quote:Bartering occurs when you exchange goods or services without exchanging money. An example of bartering is a plumber exchanging plumbing services for the dental services of a dentist. You must include in gross income in the year of receipt the fair market value of goods or services received from bartering.

Generally, you report this income on Form 1040, Schedule C (PDF), Profit or Loss from Business or Form 1040, Schedule C-EZ (PDF), Net Profit from Business. If you failed to report this income, correct your return by filing a Form 1040X (PDF). Refer to Topic 308 for information on filing an amended return.
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19-05-2014, 12:51 PM
RE: Any liberals capable of defending income tax laws?
(19-05-2014 12:48 PM)frankksj Wrote:  
(19-05-2014 11:56 AM)Chas Wrote:  Sorry, no. That is your ever-present confirmation bias once again causing you to misconstrue plain English.

Chas, what specifically in the 2nd paragraph says that if a plumber and dentist exchange services it is NOT taxable? The 1st paragraph is crystal clear that it is, the 2nd paragraph just states what form to file if you do it. You are trying your hardest to find some bizarre meaning in what is a very clear, simple and obvious statement. It seems you'll do anything to avoid the pink elephant in the room, namely that no liberal will answer the questions in my OP. You guys will do anything to change the subject, including playing silly word games. Why not answer the questions?

Here is the text from IRS topic 420. No commentary needed. It speaks for itself. The other text you quoted related to barter clubs which only ADD more requirements, but in no way remove the tax on barter:

Quote:Bartering occurs when you exchange goods or services without exchanging money. An example of bartering is a plumber exchanging plumbing services for the dental services of a dentist. You must include in gross income in the year of receipt the fair market value of goods or services received from bartering.

Generally, you report this income on Form 1040, Schedule C (PDF), Profit or Loss from Business or Form 1040, Schedule C-EZ (PDF), Net Profit from Business. If you failed to report this income, correct your return by filing a Form 1040X (PDF). Refer to Topic 308 for information on filing an amended return.

The IRS makes it perfectly clear that barter is only taxable in a business transaction - that is why every one of their examples is a trade of professional services and only reportable as income on the forms for business income.

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19-05-2014, 01:01 PM (This post was last modified: 19-05-2014 01:06 PM by frankksj.)
RE: Any liberals capable of defending income tax laws?
@Im_Ryan,

What is it going to take to get past this really obvious diversion and get back to the questions in my OP?

If I post a message in one of the many tax advice forums and ask if a barter between 2 individuals is taxable and they confirm that it is (which is obvious and undisputed) can we let go of this distraction and get back to the questions in my OP which challenge liberals to explain the moral justification for income tax?

Chas, Cjlr, et al attack me for being smug on this subject, but when I present a genuine, legitimate, thought-provoking question challenging my ideological opponents' beliefs, and they run and cling to any distraction to avoid the question at hand, how can I not be smug?

Even _IF_ you and most liberals feel the tax laws which criminalize the barter in my scenario #2 are wrong, that's a moot point. Probably all liberals would agree that scenarios #3 and on should be criminalized. The point of my questions is to get liberals to stop and think about what's the difference between scenario #2 and #3, since they're effectively the same. Why is one criminal and the other not? ANY voluntary exchange between individuals is a GOOD thing because both people think they are better off for it. So why, at some point, if you do many good things (ie lots of voluntary exchanges) it becomes criminal if you don't let a 3rd party take a cut? Why should we have a system that punishes and discourages good behavior?

If liberals are unwilling to even consider such basic questions about the nature of income tax, then how will we ever get to the REALLY important topics, like all the harm it does? I've already provided links proving that for those near the poverty line they take home LESS money the more they work because of the income tax and welfare system which traps them in poverty, and that for everybody earning between $10,000 and $40,000/year, the effective tax rate on the next dollar earned is actually 82% (combining income tax and phasing out of tax credits), so that even someone earning a respectable $20/hour gross, will only take home $3.20/hour for each additional hour he works. People may not think about this. But it teaches society that hard work does NOT pay, and that if you're living at the poverty level, the answer is not hard work but rather government redistribution. But if we can't even have a rational debate about the fundamental fairness of an income tax, how can we debate whether it does more harm than good?
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19-05-2014, 01:05 PM
RE: Any liberals capable of defending income tax laws?
(19-05-2014 12:51 PM)Chas Wrote:  The IRS makes it perfectly clear that barter is only taxable in a business transaction - that is why every one of their examples is a trade of professional services and only reportable as income on the forms for business income.

You're not making any sense. It also makes it perfectly clear that if a plumber fixes his neighbor's toilet and in return the neighbor, a dentist fixes his teeth, that _IS_ a business transaction. There is nothing in that example that is any different from my scenario where a gardener mows his neighbor's lawn, and the neighbor tutors his son.

If you think there is, fine, do you want me to edit my OP and change 'mows lawn' to 'fixes toilet', and change 'tutor my son' to 'clean my teeth'? It makes no difference to me because it doesn't in any way change my point, and that way it would be impossible for you to weasel out of it since I would use the exact same scenario the IRS uses. If I do that, THEN will you answer the questions in my OP? Or do you admit this is just a distraction and it doesn't matter I do to the OP, you will not answer the questions?
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19-05-2014, 01:14 PM (This post was last modified: 19-05-2014 01:17 PM by djhall.)
RE: Any liberals capable of defending income tax laws?
(19-05-2014 01:05 PM)frankksj Wrote:  
(19-05-2014 12:51 PM)Chas Wrote:  The IRS makes it perfectly clear that barter is only taxable in a business transaction - that is why every one of their examples is a trade of professional services and only reportable as income on the forms for business income.

You're not making any sense. It also makes it perfectly clear that if a plumber fixes his neighbor's toilet and in return the neighbor, a dentist fixes his teeth, that _IS_ a business transaction. There is nothing in that example that is any different from my scenario where a gardener mows his neighbor's lawn, and the neighbor tutors his son.

If you think there is, fine, do you want me to edit my OP and change 'mows lawn' to 'fixes toilet', and change 'tutor my son' to 'clean my teeth'? It makes no difference to me because it doesn't in any way change my point, and that way it would be impossible for you to weasel out of it since I would use the exact same scenario the IRS uses. If I do that, THEN will you answer the questions in my OP? Or do you admit this is just a distraction and it doesn't matter I do to the OP, you will not answer the questions?

YABUT, if your girlfriend moves in with you, and she doesn't contribute to the rent, and you don't give her money for sex, and neither of you report the market value of rental lodging or prostitution services and fail to pay taxes on it... WHAT THEN?!?!!?!? Ohmy
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19-05-2014, 01:23 PM
RE: Any liberals capable of defending income tax laws?
(19-05-2014 01:01 PM)frankksj Wrote:  @Im_Ryan,

What is it going to take to get past this really obvious diversion and get back to the questions in my OP?

If I post a message in one of the many tax advice forums and ask if a barter between 2 individuals is taxable and they confirm that it is (which is obvious and undisputed) can we let go of this distraction and get back to the questions in my OP which challenge liberals to explain the moral justification for income tax?

Chas, Cjlr, et al attack me for being smug on this subject, but when I present a genuine, legitimate, thought-provoking question challenging my ideological opponents' beliefs, and they run and cling to any distraction to avoid the question at hand, how can I not be smug?

Even _IF_ you and most liberals feel the tax laws which criminalize the barter in my scenario #2 are wrong, that's a moot point. Probably all liberals would agree that scenarios #3 and on should be criminalized. The point of my questions is to get liberals to stop and think about what's the difference between scenario #2 and #3, since they're effectively the same. Why is one criminal and the other not? ANY voluntary exchange between individuals is a GOOD thing because both people think they are better off for it. So why, at some point, if you do many good things (ie lots of voluntary exchanges) it becomes criminal if you don't let a 3rd party take a cut? Why should we have a system that punishes and discourages good behavior?


Your whole premise is wrong, including scenario #3.

The IRS doesn't give a fuck about any of those. It only cares about commercial bartering.

So there is no harm being done.

Quote:If liberals are unwilling to even consider such basic questions about the nature of income tax, then how will we ever get to the REALLY important topics, like all the harm it does? I've already provided links proving that for those near the poverty line they take home LESS money the more they work because of the income tax and welfare system which traps them in poverty, and that for everybody earning between $10,000 and $40,000/year, the effective tax rate on the next dollar earned is actually 82% (combining income tax and phasing out of tax credits), so that even someone earning a respectable $20/hour gross, will only take home $3.20/hour for each additional hour he works. People may not think about this. But it teaches society that hard work does NOT pay, and that if you're living at the poverty level, the answer is not hard work but rather government redistribution. But if we can't even have a rational debate about the fundamental fairness of an income tax, how can we debate whether it does more harm than good?

Again, you go off on a tangent based on your utterly false premise.

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19-05-2014, 01:46 PM
Re: Any liberals capable of defending income tax laws?
Your scenario might fit if you changed it to.

A neighbor with a landscaping business helped his sickly neighbor and started maintaining his lawn through that. Then the neighbor who was a teacher or had a tudor service started tutoring the other guys son freely. That's a business involved barter exchange that's different from your loose scenario.

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