IRS Instructs Americans to Report Stolen Property and Drug Sales as Income

The Internal Revenue Service is reminding Americans they have a duty to report any property they stole in 2021 as hard-earned income for their taxes in the months ahead.

“If you steal property, you must report its fair market value in your income in the year you steal it unless you return it to its rightful owner in the same year,” the IRS advised in Publication 17, published for the 2021 tax year. The bureau similarly called on those who sold illicit goods to report their proceeds, and specifically cited narcotics as an example, writing, “Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity.”

The IRS publication made headlines this week after a cryptocurrency trader who goes by “litquidity” shared an image of the guidance on Twitter. “Tax szn is around the corner,” he noted. “Remember to report your income from illegal activities and stolen property to the IRS.”

Am I allowed to count those who stole from me as dependents?

— Joel Heyman (@JoelHeyman) December 27, 2021

Sadly, the agency didn’t say whether the criminally employed could deduct expenses they incurred in the process of obtaining their illegal goods — or provide specific guidance on how they should calculate the value of unsold items.

Watch above via Fox News.