Isn't this wonderful? Yet another TP who has no clue.
Looked at from a transactional standpoint, your cost basis in your labor is zero. You then exchange your labor, in which you have a cost basis of zero, for something of value, usually money. All of the money (or other things of value) you receive in exchange for your labor is "profit" or gross income.
And, no, you may not deduct your personal living expenses, as deductions from gross income are a matter of legislative grace, and the legislature has not seen fit to make personal living expenses either deductible from gross income or attributable to the basis of anything for tax purposes.
It's much easier to understand that income is "all income from whatever source derived" and that income means any clearly realized accession to wealth. You can then rather easily deduce that all TP clap-trap and voodoo magic words are just that.
But, good luck to all of you who think you are flying under the radar based on whatever goofy theory you subscribe to today or next month or next year, you're gonna need it. In over 90 years, NONE, that is exactly zero, of the dozens of stupid TP "arguments" have succeeded in court in defeating tax or penalties or interest.
3 or 4 TPs out of thousands have avoided federal prison based on a Cheek "I was too stupid to know any better" defense. They still have to pay the tax, penalty and interest, not to mention their criminal defense attorney and often their divorce attorney.
By Larry Neumeister
Associated Press Writer
New York
Tuesday, July 17, 2007 05:05:28 AM PT
A federal judge dismissed charges Monday against 13 former KPMG employees in what the government had described as the largest criminal tax case in U.S. history, saying the prosecutors prevented them from presenting their defenses.
U.S. District Judge Lewis A. Kaplan said the dismissal was necessary because the government coerced KPMG to limit and then cut off its payment of the onetime employees' legal fees.
(for link see: http://marketplace.publicradio.org/apheadline_detail.php?story_id=D8QDQ37G0&group=ap.online.headlines.business)
This is one good reason the tax protesters rail and struggle against the IRS. Once the agency trains its guns on you you're pretty much screwed. Whether you are right or wrong you simply don't have the means to defend yourself. The TPs fervently believe that we have an out of control tax situation in this country and are determined to stand against it, no matter that they are almost certainly sure to be defeated. For what it's worth, I'm on their side and applaud them for their efforts.