I'll ask you again. Where is the term wages and salaries in Sec. 61 about sources of income? If it's not there and the example you gave on Sec. 61 demonstrates that case, then Mrs. Kuglin (sp) certainly was justified in her actions since wages and saleries are not even listed as a source of income.
And for those that don't know it, as people pointed out that the mission of the IRS is to achieve the highest level of voluntary compliance, the IRS changed its mission to "showing the public the tax laws that apply" or sumping like that in order to obscure the voluntary nature of the income tax. They didn't even show Mrs. Kuglin the laws that apply to her so they failed with their revised mission to her. This further justified her action(s) in this regard!
I just gave you the cite....26CFR, Sec 1.61-2 specifically identifies wages and salaries as income!!! Even if Kuglin was too slow to follow the US Code definition of "income from whatever source derived" and specically identifies "compensation for services", she could have gone to any IRS office and asked for the laws and guidelines, or to explain Title 26 US Code. But we both know she was not that stupid. She was playing a game with them, is damn lucky she had a stupid jury, and will eventually pay her taxes, interest and penalties.
Even if you can't find the CFR's, I need to know why wages and salaries aren't compensation for services, or part of "income from whatever source derived".
From the super secret public web site at the IRS
. The Voluntary Nature of the Federal Income Tax System
A. Contention: The filing of a tax return is voluntary.
Some assert that they are not required to file federal tax returns because the filing of a tax return is voluntary. Proponents point to the fact that the IRS itself tells taxpayers in the Form 1040 instruction book that the tax system is voluntary. Additionally, the Supreme Court's opinion in Flora v. United States, 362 U.S. 145, 176 (1960), is often quoted for the proposition that "our system of taxation is based upon voluntary assessment and payment, not upon distraint."
The Law: The word "voluntary," as used in Flora and in IRS publications, refers to our system of allowing taxpayers to determine the correct amount of tax and complete the appropriate returns, rather than have the government determine tax for them. The requirement to file an income tax return is not voluntary and is clearly set forth in Internal Revenue Code §§ 6011(a) , 6012(a) , et seq., and 6072(a). See also Treas. Reg. § 1.6011-1(a).
Any taxpayer who has received more than a statutorily determined amount of gross income is obligated to file a return. Failure to file a tax return could subject the noncomplying individual to criminal penalties, including fines and imprisonment, as well as civil penalties. In United States v. Tedder, 787 F.2d 540, 542 (10 th Cir. 1986), the court clearly states, "although Treasury regulations establish voluntary compliance as the general method of income tax collection, Congress gave the Secretary of the Treasury the power to enforce the income tax laws through involuntary collection . . . . The IRS' efforts to obtain compliance with the tax laws are entirely proper."
Relevant Case Law:
Helvering v. Mitchell, 303 U.S. 391, 399 (1938) - The U.S. Supreme Court stated, "[i]n assessing income taxes, the Government relies primarily upon the disclosure by the taxpayer of the relevant facts . . . in his annual return. To ensure full and honest disclosure, to discourage fraudulent attempts to evade the tax, Congress imposes [either criminal or civil] sanctions."United States v. Tedder, 787 F.2d 540, 542 (10 th Cir. 1986) - The court upheld a conviction for willfully failing to file a return, stating that the premise "that the tax system is somehow 'voluntary' . . . is incorrect."
United States v. Richards, 723 F.2d 646, 648 (8 th Cir. 1983) - The court upheld conviction and fines imposed for willfully failing to file tax returns, stating that the claim that filing a tax return is voluntary "was rejected in United States v. Drefke, 707 F.2d 978, 981 (8 th Cir. 1983), wherein the court described appellant's argument as "an imaginative argument, but totally without arguable merit."
Woods v. Commissioner, 91 T.C. 88, 90 (1988) - The court rejected the claim that reporting income taxes is strictly voluntary, referring to it as a "tax protester type" argument, and found Woods liable for the penalty for failure to file a return.
Johnson v. Commissioner, T.C. Memo. 1999-312, 78 T.C.M. (CCH) 468, 471 (1999) - The court found Johnson liable for the failure to file penalty and rejected his argument "that the tax system is voluntary so that he cannot be forced to comply" as "frivolous."