Other People's Money
Tax Notes, Vol. 125, No. 1, p. 137, October 5, 2009
6 Pages Posted: 15 Oct 2009 Last revised: 22 Mar 2010
Date Written: October 9, 2009
In informal banking arrangements such as cundinas and tandas, the “banker” will have an unexplained fund of money, which the IRS will presume was acquired in a taxable way. Drug dealers and embezzlers often have the same problem. The informal bankers, with adequate records, can rebut the presumption. However, it is too bad that they have to be analogized to criminals in order to do so.
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