Definitions

[FRANKENSTEIN]

What is the definition of "trade or business" for purposes of income tax ?

[AnOwlCalledSage]

He's back

[wserra]

As you likely know, (1) there is no unitary definition for "trade or business" in the IRC, (2) various statutes use the phrase in different contexts, (3) there is a substantial body of case law defining it for those different contexts, and (4) 99.9% of the time, it is clear whether a particular activity is a trade or business. If your situation is one of the 0.1% that are unclear, consult a tax lawyer.

We don't do dumbass "gotcha" questions here. State a proposition and defend it, or go away.

[AnOwlCalledSage]

We don't do dumbass "gotcha" questions here. State a proposition and defend it, or go away.

It's posted in the US section so I'm not sure what it is there but the official UK Government guidance is:

The Taxes Acts give very little guidance on the meaning of the word ‘trade’. S989 ITA 2007 and S1119 CTA 2010 say that ‘trade’ includes any ‘venture in the nature of trade’.

There is no further statutory help. As a result the courts have established for themselves what amounts to a ‘trade’, or ‘trading’, and their decisions provide guidance when the point is in dispute.

I suspect that "consult a qualified lawyer in your jurisdiction" isn't an answer he'd accept... even though it's the correct one

[FRANKENSTEIN]

What about :
26 U.S. Code § 7701 - Definitions
(26)Trade or business
The term “trade or business” includes the performance of the functions of a public office.

Is that not the Definition of "trade or business" for Title 26 ?

[AnOwlCalledSage]

I suspect that "consult a qualified lawyer in your jurisdiction" isn't an answer he'd accept... even though it's the correct one

Nailed it!

[wserra]

Is that [26 USC § 7701(a)(26)] not the Definition of "trade or business" for Title 26 ?

That's as close as you'll find in the IRC - but it must be read with the definition of "includes".

(c) Includes and including. The terms “includes” and “including” when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined.

Plugging that into § 7701(a)(26) yields "The term 'trade or business' includes the performance of the functions of a public office as well as things otherwise within the ordinary meaning of 'trade or business'." As I wrote above, the IRC does not comprehensively define the term. I realize that you would like to say - as people do with other statutes that use forms of the word "include" - that "trade or business" means only the performance of the functions of a public office. That reading, however, is the result of illiteracy.

By the way, you don't have to take my word for it - even though "my word" amounts simply to basic reading comprehension.

Bennett contends that he "is not a 'trade or business' as defined at § 7701(a)(26) because he is not 'included' in 'the performance of the functions of a public office' . . . ." Bennett contends that since his income did not derive from the performance of the functions of a public office, he therefore had no self-employment income and no net earnings from self-employment during the relevant tax years.

These contentions are disingenuous and plainly wrong, considering the plain language of the statutes. Section 7701(c) expressly provides that the "terms 'includes' and 'including' when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined." 26 U.S.C. § 7701(c). Accordingly, the term "includes" in this context is a term of enlargement, not a term of limitation. Section 7701(a)(26) "is intended to expand its reach to include public office, it does not exclude private business operations." (Citations omitted.)

United States v. Bennett, 2010 U.S. Dist. LEXIS 74662, *4-5 (FLMD 2010).

[Pottapaug1938]

What about :
26 U.S. Code § 7701 - Definitions
(26)Trade or business
The term “trade or business” includes the performance of the functions of a public office.

Is that not the Definition of "trade or business" for Title 26 ?

Wserra has already given you more of an answer than you deserve; but rather than your playing Twenty Questions here, and fishing for an answer which matches your preconceptions, why don't you just tell us the purpose of your questions?

[FRANKENSTEIN]

Is that [26 USC § 7701(a)(26)] not the Definition of "trade or business" for Title 26 ?

That's as close as you'll find in the IRC - but it must be read with the definition of "includes".

(c) Includes and including. The terms “includes” and “including” when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined.

Plugging that into § 7701(a)(26) yields "The term 'trade or business' includes the performance of the functions of a public office as well as things otherwise within the ordinary meaning of 'trade or business'." As I wrote above, the IRC does not comprehensively define the term. I realize that you would like to say - as people do with other statutes that use forms of the word "include" - that "trade or business" means only the performance of the functions of a public office. That reading, however, is the result of illiteracy.

By the way, you don't have to take my word for it - even though "my word" amounts simply to basic reading comprehension.

Bennett contends that he "is not a 'trade or business' as defined at § 7701(a)(26) because he is not 'included' in 'the performance of the functions of a public office' . . . ." Bennett contends that since his income did not derive from the performance of the functions of a public office, he therefore had no self-employment income and no net earnings from self-employment during the relevant tax years.

These contentions are disingenuous and plainly wrong, considering the plain language of the statutes. Section 7701(c) expressly provides that the "terms 'includes' and 'including' when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined." 26 U.S.C. § 7701(c). Accordingly, the term "includes" in this context is a term of enlargement, not a term of limitation. Section 7701(a)(26) "is intended to expand its reach to include public office, it does not exclude private business operations." (Citations omitted.)

United States v. Bennett, 2010 U.S. Dist. LEXIS 74662, *4-5 (FLMD 2010).

It also doesn't EXCLUDE what the Statute specifically INCLUDES as the Statute Definition .
You can "include" other things , that otherwise also being included , would be within the Meaning
of the term "trade or business" Defined . The term defined INCLUDES "performance of the functions of a public office" .
You can include whatever you want after that .

[wserra]

Well, that's either trivial or gibberish. It isn't written with sufficient clarity to decide which. Is English your native language?

It also doesn't EXCLUDE what the Statute specifically INCLUDES as the Statute Definition .

So 26 USC § 7701(a)(26) doesn't exclude from "trade or business" what it specifically includes, namely "the performance of the functions of a public office". Brilliant. That's one in the "trivial" column.

You can "include" other things , that otherwise also being included , would be within the Meaning of the term "trade or business" Defined .

Hmm. That may actually be correct, although the highly awkward sentence structure makes it impossible to be sure. I do like the seemingly Random Capitalization, though. Gibberish.

The term defined INCLUDES "performance of the functions of a public office" .

You mean just because it says so in so many words? What kind of reason is that? Back to "trivial".

You can include whatever you want after that .

Stained glass windows? Christmas carols? Ovaltine? Gibberish.

They don't make trolls like they used to.

[FRANKENSTEIN]

Let me put it in a way you should understand .
If a "trade or business" doesn't include "performance of the functions of a public office" ,
then it's not a "trade or business" within the meaning of that term as it's defined
for its Statutory purposes to mean .

[Pottapaug1938]

Let me put it in a way you should understand .
If a "trade or business" doesn't include "performance of the functions of a public office" ,
then it's not a "trade or business" within the meaning of that term as it's defined
for its Statutory purposes to mean .

What's it to you? Why do you care? What is the motivation behind your wanting answers to your questions?

It sure looks to me like you are "baiting a hook" and hoping for a certain desired answer to buttress a crazy hypothesis.

[NYGman]

Let me put it in a way you should understand .
If a "trade or business" doesn't include "performance of the functions of a public office" ,
then it's not a "trade or business" within the meaning of that term as it's defined
for its Statutory purposes to mean .

It's not a list of requirements did you not "read" what Wes posted. Performing the functions of public office is not an exclusive requirement.

Trade or Business also has its defined meaning outside a legal definition, which is the obvious forms of trade and business people do. The regs do not ignore the real world definition of words, it just may clarify or expand those things. Person for example can be an entity, doesn't exclude you or me from that definition under the code.

You can't contort a meaning or pervert am existing definition. Now go back and read the case Wes posted and come back with something original.

Don't you think that if your position, and I think we all know what that position is, was valid, it would have been successful in court. There's no evidence of that, because it's never happened. Frankly if it did, the regulations would be amended to fix it because that's not the intent here. And we all know the intent, the true intent of those words. You can play around with your word games and word salad, but at the end of the day you're still wrong.

If you think trade and business mean something else, cite a case that shows your position, you are clearly not a lawyer and your understanding of Legal statues and regulations is severely lacking. My seventh grade boys get this, it's not that hard.

* Edited to fix some Voice Dictation errors, Probably more I missed

[The Observer]

Let me put it in a way you should understand .
If a "trade or business" doesn't include "performance of the functions of a public office" ,
then it's not a "trade or business" within the meaning of that term as it's defined
for its Statutory purposes to mean .

So my guess is that Frankie here is going to claim that the statute requires a trade or business to have some kind of performance of the functions of the public office in order to be taxed. And if your business/trade doesn't do that, well then your business/trade can't be taxed.

It is about as a tortured interpretation of the IRC as many others we have seen over the years. Of course we know what will happen when someone tries to run with that in Tax Court or federal district court.

[wserra]

So my guess is that Frankie here is going to claim that the statute requires a trade or business to have some kind of performance of the functions of the public office in order to be taxed. And if your business/trade doesn't do that, well then your business/trade can't be taxed.

Yes, I believe you're quite correct. Gotta draw these guys out a little, and make them actually take a position. Otherwise, once you show how dumb it is, they just deny that they asserted it.

So Little Frankie interprets 26 USC § 7701(a)(26) ("The term 'trade or business' includes the performance of the functions of a public office") as requiring that, in order to be a trade or business, the thing in question must have something to do with the functions of a public office. Consider the following statement: "The term 'dog' includes Chihuahuas." Perfectly true, right? Frankie would read it to mean that, in order to be a dog, a Great Dane must be part Chihuahua.

I think the good Dr. Frankenstein missed this guy's neck and put the bolt through his brain. Or he's just Abby Normal.

[AnOwlCalledSage]

So Little Frankie interprets 26 USC § 7701(a)(26) ("The term 'trade or business' includes the performance of the functions of a public office") as requiring that, in order to be a trade or business, the thing in question must have something to do with the functions of a public office.

I like the courts of England and Wales position. It's anything that a court decides it is, not some fool on the interwebs who can't comprehend basic English meanings

[FRANKENSTEIN]

So my guess is that Frankie here is going to claim that the statute requires a trade or business to have some kind of performance of the functions of the public office in order to be taxed. And if your business/trade doesn't do that, well then your business/trade can't be taxed.

Yes, I believe you're quite correct. Gotta draw these guys out a little, and make them actually take a position. Otherwise, once you show how dumb it is, they just deny that they asserted it.

So Little Frankie interprets 26 USC § 7701(a)(26) ("The term 'trade or business' includes the performance of the functions of a public office") as requiring that, in order to be a trade or business, the thing in question must have something to do with the functions of a public office. Consider the following statement: "The term 'dog' includes Chihuahuas." Perfectly true, right? Frankie would read it to mean that, in order to be a dog, a Great Dane must be part Chihuahua.

I think the good Dr. Frankenstein missed this guy's neck and put the bolt through his brain. Or he's just Abby Normal.

You say " the term 'dog' includes Chihuahuas". Is that just a statement of fact regarding the usual definition of "dog" ?
Or are you stating it as a Definition , to define what you intend "dog" to mean ?

[FRANKENSTEIN]

Let me put it in a way you should understand .
If a "trade or business" doesn't include "performance of the functions of a public office" ,
then it's not a "trade or business" within the meaning of that term as it's defined
for its Statutory purposes to mean .

It's not a list of requirements did you not "read" what Wes posted. Performing the functions of public office is not an exclusive requirement.

Trade or Business also has its defined meaning outside a legal definition, which is the obvious forms of trade and business people do. The regs do not ignore the real world definition of words, it just may clarify or expand those things. Person for example can be an entity, doesn't exclude you or me from that definition under the code.

You can't contort a meaning or pervert am existing definition. Now go back and read the case Wes posted and come back with something original.

Don't you think that if your position, and I think we all know what that position is, was valid, it would have been successful in court. There's no evidence of that, because it's never happened. Frankly if it did, the regulations would be amended to fix it because that's not the intent here. And we all know the intent, the true intent of those words. You can play around with your word games and word salad, but at the end of the day you're still wrong.

If you think trade and business mean something else, cite a case that shows your position, you are clearly not a lawyer and your understanding of Legal statues and regulations is severely lacking. My seventh grade boys get this, it's not that hard.

* Edited to fix some Voice Dictation errors, Probably more I missed

Not "contorting or perverting an existing definition" at all !
As you say , the Regs may clarify or expand those things .
Guess you don't know what a "Definition" means . And 7th grade boys aren't very smart .

[FRANKENSTEIN]

So Little Frankie interprets 26 USC § 7701(a)(26) ("The term 'trade or business' includes the performance of the functions of a public office") as requiring that, in order to be a trade or business, the thing in question must have something to do with the functions of a public office.

I like the courts of England and Wales position. It's anything that a court decides it is, not some fool on the interwebs who can't comprehend basic English meanings

No ! It's what the LAW has Defined it to mean .

[FRANKENSTEIN]

Let me put it in a way you should understand .
If a "trade or business" doesn't include "performance of the functions of a public office" ,
then it's not a "trade or business" within the meaning of that term as it's defined
for its Statutory purposes to mean .

What's it to you? Why do you care? What is the motivation behind your wanting answers to your questions?

It sure looks to me like you are "baiting a hook" and hoping for a certain desired answer to buttress a crazy hypothesis.

I just like to know the Truth ! I am pretty close to knowing everything so far .
For instance , did you know that all colors are made in the brain ? Even white brightness .
Everything is actually total Blackness . Want undeniable Proof ???