Mutter's analysis

[LPC]

Mutter past [sic] on as of 2/4/2009, you will be sorely missed.

It's rather typical of cults to speak and think of those who leave the cult as though they were dead.

[Lambkin]

Note my reply to them.
By the way a spot of dic is a sausage i ll have to check if the english chick said anything back

Maybe you are thinking of spotted dick, which is a suet pudding. Mmmm animal fat.

http://www.epicurious.com/recipes/food/ ... ick-103210

[Famspear]

I have emailed, to Mutter, some PDF copies of the decisions in the Mooney case, at the Tax Court and at the Court of Appeals, and copies of the briefs by Mooney and by the government at the Court of Appeals.

Note: I seem to recall that Mooney may have made a reference to a "district court" case, but if so, this may have been a typo on the part of Mooney. As far as I know, his case was Tax Court, then Court of Appeals.

[mutter]

Dear Mutter: The Tax Court decision on May 5, 2008, ruling against Patrick Michael Mooney is at the Tax Court web site, but it's hard to find. The Tax Court web site is rather klunky, generally. I am going to email a PDF copy of the May 5th decision to you.

The May 5th decision does not specifically mention Hendrickson or Cracking the Code in the way the court decision in the Scott case does, though.

Also, Mooney appealed his Tax Court loss to the Court of Appeals, and the Court of Appeals ruled against him. Later, I can email you a PDF copy of Mooney's brief in his appeal at the Court of Appeals. You can see his arguments. I don't recall whether he specifically mentioned Hendrickson on appeal, either.

But you can be the judge of what happened to Mooney.

mooney is a well known name at LH. just from the bit of the case cited earlier I can see he was doing CtC. undeniable!

[mutter]

Note my reply to them.
By the way a spot of dic is a sausage i ll have to check if the english chick said anything back

Maybe you are thinking of spotted dick, which is a suet pudding. Mmmm animal fat.

http://www.epicurious.com/recipes/food/ ... ick-103210

its Pudding? Oh well I am sure they got the joke

[Famspear]

At losthorizons, after Mutter posted this:

No mutter has legally educated himself via a paralegal course, which changed my understanding of the law. Mutter will no longer accept the opinions of non legally educated persons over those who are! You should do the same and you should ask PH about the tax court case of one Andrew Scott (sandiego scott?) and ask Patrick Mooney how his case went in district court.
Then ask yourself why these case are not common knowledge on here. IE why PH doesnt know about them or has kept the info to himself.
any of you want the court cases email me at geomutter at hotmail
Good night and God Bless you with some education

..... user Weston White responded with this (in part):

[ . . . ] Andrew Scott not familiar with that one, Patrick Mooney does he not argue about jurisdiction and citizenship related issues? Since when is that CtC supported methodology?

http://www.losthorizons.com/phpBB/viewt ... 3015#13015

Not familiar with the Andrew Scott case, eh Weston? How convenient. Maybe someone should email you a copy of the decision. Let me guess: You would come up with some reason to reject it, anyway....

The Patrick Mooney case? Weston, maybe you should read what Patrick Mooney actually did argue. It's reasonably clear he's arguing elements of Cracking the Code, without mentioning the book by name.

I personally have started studying reading Jurisdictionary and Nolo legal books for the last two weeks and I feel only more adamant towards my current understanding of the IRC.

That's not a good sign for you, Weston. I hope this statement does not come back to haunt you someday.

Personally I would have to wonder why you would put an even so much of an ounce of consideration into what some circuit court ruled, it means squat unless you are being tried within that same jurisdiction.

Well, it is correct to say that the holding of a court of appeals in a circuit other than your own is not binding on courts in your circuit. The problem is that the courts in your circuit may well adopt the reasoning or holding of that court some day.

And so far as the Article I "tax court" is concerned if you are in tax court under proceeding and are not a 'taxpayer', than you sir are an uniformed moron and quite honestly deserve whatever punishment is bestowed upon you... and doubly so if you are going to dare argue about jurisdiction.

Meaningless tax protester gibberish, Weston. Mr. Scott argued Cracking the Code by name, in the United States Tax Court. The Court specifically repudiated Hendrickson and Cracking the Code.

How would PH know about every tax court case or circuit case that occurs? Does he not have his own life to live? Just as you, just as me.

Oh, he's a busy man. Doesn't have time to research and reveal the losses his scam has suffered in court. Yeah. That's what I thought.

The last time I looked, Hendrickson had a web site called losthorizons.com. Hendrickson seems to have had plenty of time. No, Weston, Hendrickson does not need to know about every Tax Court or Circuit court case that "occurs." He definitely needs to know about the cases that affect him, and he definitely needs to know about the cases that repudiate his scam.

Figuratively speaking, you are whistling past the cemetery, Weston. Not convincing at all.

Peace out, enjoy Quackloss, even their color scheme looks like it was picked out of a bathroom frequented by men of the 290 [pervert/sexual deviant/molester] caliber (and their mascot supports that allegation).

OK, so that's it, eh Weston? That's your response?

That's what I thought.

[Famspear]

Interesting, now that Patrick Michael Mooney has lost his CtC case, the die-hards like Weston White are now angrily trying to cut the tie to Mooney.

Patrick even has a January 2006 video interview with Hendrickson on Patrick's web site. Go here:

http://www.unlearning.org/library.htm

... and click on the applicable link, included in a list of other video links.

So sorry, Patrick Mooney...... I guess you were a star of sorts at losthorizons -- until you lost your own case.

Weston has learned the scam well from Hendrickson. As each member of the gang loses in court, cut 'em loose.......

Weston wants to hold his hands over his ears, now..... "Nooooooo, I don't knooooowwwww about the Scott case.... Noooooooo, I don't want to believe it about the Mooney case....."

You're making your own bed, Weston. Good luck.

[Famspear]

To recap, Patrick Michael Mooney's argument at the Court of Appeals for the Fourth Circuit was that the entities for which he performed work in 2004 were "private sector companies." He argued that he "did not engage in any economic activity which was connected with the exercise of a federal privilege or performance of any function of a public office in 2004". See page 1, under Issue 1, of Mooney's brief filed with the Court of Appeals in Mooney v. Commissioner on September 19, 2008, case no. 08-1899, at docket entry 8.

Mooney went on to use the Hendrickson argument that his "original filing is the beginning and end of this dispute", to use Mooney's words. Mooney says that the "law plainly says that when a return is filed, the amount reported by the filer as annual income subject to the tax is to be accepted as the final word on the subject....." Mooney then quotes from and cites section 93 of the Revenue Act of 1862.

Mooney does indeed make the goofy, nonsensical argument that although he himself is the one who filed the appeal, the Court of Appeals "has no jurisdiction to consider, determine, rule upon, or otherwise exercise any authority whatsoever as to the amount of income received" by Mooney. (See page 2 of the brief; bolding and italics are Mooney's, in the original text).

Mooney goes on to state that the Commissioner of Internal Revenue, the Respondent/Appellee, "has sought to rely on the erroneous W-2 testimony of the two private sector companies, which, for all legal purposes, is nullified by the testimony (claim for refund) of the Appellant [i.e., Patrick Mooney]." See page 2 of the brief.

Mooney also argues that the Commissioner's "legal powers remain limited to the assessment of the tax on a stated income. Respondent/Appellee [the IRS] is not permitted under the law to declare the amount of income when a legal and timely self-assessment is filed." (underlining and italics are those of Mr. Mooney). See page 3 of the brief.

Mooney later goes on to say that he "once again reminds this court that Section 93 of the Revenue Act of 1862 makes his claim for refund the only valid testimony in these proceedings with regard to the issue of any tax liability." See p. 5.

Mooney also argues that "it is the activities themselves which are taxable. These activities, if the federal income excise laws are to be properly applied, must be avoidable." See page 8 (bolding is by Mr. Mooney in the original).

Again, Mooney states: "But Appellant [Mooney] also understands that once his sworn testimony, in the form of a self-assessment, is entered into the public record, then that testimony becomes the controlling, defining and final document in the matter." See page 9.

Yet, all these arguments were for naught. Mooney lost his appeal. The Court of Appeals affirmed the decision of the Tax Court, including the penalty imposed on Mooney for his frivolity.

EDIT: After all that garbage by Patrick Michael Mooney, here is the per curiam response of the United States Court of Appeals for the Fourth Circuit:

Patrick Mooney appeals from the tax court’s order dismissing his petition for redetermination of the Commissioner’s finding of a deficiency in Mooney’s 2004 income taxes and assessing penalties. We have reviewed the record and the tax court’s opinion and find no abuse of discretion and no reversible error. Accordingly, we affirm on the reasoning of the tax court. Mooney v. Comm’r., Tax Ct. No. 06-21647 (U.S. Tax Ct. May 5, 2008). We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before the court and argument would not aid the decisional process.

(bolding added).

That's it, folks. That's all she wrote. Mooney's arguments weren't even deemed good enough by the Court to bother to discuss them.

[mutter]

this is so funny I had to share
The IRS decides to audit Grandpa, and summons him to the IRS office.
The IRS auditor was not surprised when Grandpa showed up with his attorney.
The auditor said, 'Well, sir, you have an extravagant lifestyle and no full-time employment, Which you explain by saying that you win money gambling. I'm not sure the IRS finds that believable.'
I'm a great gambler, and I can prove it,' says Grandpa. 'How about a demonstration?'
The auditor thinks for a moment and said, 'Okay. Go ahead.'
Grandpa says, 'I'll bet you a thousand dollars that I can bite my own eye.'
The auditor thinks a moment and says, 'It's a bet.'
Grandpa removes his glass eye and bites it. The auditor's jaw drops.
Grandpa says, 'Now, I'll bet you two thousand dollars that I can bite my other eye.'
Now the auditor can tell Grandpa isn't blind, so he takes the bet.
Grandpa removes his dentures and bites his good eye.
The stunned auditor now realizes he has wagered and lost three grand, with Grandpa's attorney as a witness. He starts to get nervous.
'Want to go double or nothing?' Grandpa asks 'I'll bet you six thousand dollars that I can stand on one side of your desk, and pee into that wastebasket on the other side, and never get a drop anywhere in between.'
The auditor, twice burned, is cautious now, but he looks carefully and decides there's no way this old guy could possibly manage that stunt, so he agrees again.
Grandpa stands beside the desk and unzips his pants, but although he strains mightily, he can't make the stream reach the wastebasket on the other side, so he pretty much urinates all over the auditor's desk.
The auditor leaps with joy, realizing that he has just turned a major loss into a huge win.
But Grandpa's own attorney moans and puts his head in his hands.
Are you okay?' the auditor asks.
'Not really,' says the attorney. 'This morning, when Grandpa told me he'd been summoned for an audit, he bet me twenty-five thousand dollars that he could come in here and pee all over your desk and that you'd be happy about it!'

Don't Mess with Old People!!

[Famspear]

The subject matter jurisdiction argument by Mooney (and it appears to be a subject matter jurisdiction argument, not a personal jurisdiction one) was particularly laughable. How could the Court of Appeals even rule in Mooney's favor if the Court had no subject matter jurisdiction to determine the income amount, etc.? If Mooney were correct about the Court's lack of jurisdiction, then even if the Court of Appeals agreed with Mooney about his income and concluded that Mooney was right and the IRS was wrong, the Court -- under Mooney's own goofy theory -- would have to dismiss his case on the Court's own motion, and Mooney would be left with the very Tax Court loss that he was trying to overturn. For heaven's sake, Mooney, you were the one filing the appeal. It is stupid to appeal a case and then argue that the very court you are asking to hear your case lacks "jurisdiction."

The guy is clueless. Again, these people do not understand what is meant by terms such as "subject matter jurisdiction."

[mutter]

so its 100% fact that the court/judge can and will determine if what you are paid is income
and if you did earn wages as defined were an employee as defined etc. cos its a matter of law isnt it.
in all fairness thou I think mooney meant the court didnt have the authority to declare what he was paid was income, wages etc. Which would be a subject matter. right?

[wserra]

so its 100% fact that the court/judge can and will determine if what you are paid is income and if you did earn wages as defined were an employee as defined etc. cos its a matter of law isnt it.

Yes, it is.

in all fairness thou I think mooney meant the court didnt have the authority to declare what he was paid was income, wages etc. Which would be a subject matter. right?

No. There is a difference between authority (or power) and jurisdiction. A court that has jurisdiction to adjudicate a shoplifting charge against me does not have the power to order me shot at dawn for it. A court which has jurisdiction over Mooney's tax case doesn't have the power to order him to (for example) pay treble damages. It does, however, surely have the power to declare his income wages subject to income taxation.

[Famspear]

so its 100% fact that the court/judge can and will determine if what you are paid is income
and if you did earn wages as defined were an employee as defined etc. cos its a matter of law isnt it.
in all fairness thou I think mooney meant the court didnt have the authority to declare what he was paid was income, wages etc. Which would be a subject matter. right?

Well, let me answer that this way. We have to first talk about what the trial court (in this case, the Tax Court) can do, and then about what the Appeals Court can do.

Let's put aside the topic of subject matter jurisdiction for a moment.

Assuming that the trial court has subject matter jurisdiction, the trial court has the power to decide both questions of law and questions of fact. Whether Mooney received $XXX amount of money from Employer Z during 2004 would be a question of fact. Whether that amount would constitute an item of "gross income" as defined under section 61 of the Internal Revenue Code would be a question of law, I would argue. The Tax Court would definitely have the power to declare that what Mooney was paid was "income," or that what Mooney was paid was "wages".

The Tax Court has the power to decide both kinds of questions.

The subject matter jurisdiction of the Tax Court is granted by section 7442 of the Internal Revenue Code, in conjunction with section 6214, for this kind of case (if I'm understanding correctly, this was an ordinary "redetermination of deficiency" case under section 6213, so section 6214 and section 7442 would be the jurisdictional provisions, I think).

Section 6214(a) states that the Tax Court has jurisdiction to "redetermine the correct amount of the deficiency", etc., etc. Determining whether a particular receipt constitutes an item of "gross income" as defined in section 61 would be an example of the determination of a legal issue that leads up to the determination of the "deficiency."

The "deficiency," by the way, for purposes of this statute, does not necessarily mean the unpaid amount of tax (although, if IRS turns out to be correct, the deficiency amount usually happens to be equal to the unpaid amount, anyway). In Tax Court, the "deficiency" is generally the excess of what the IRS CLAIMS is the correct amount of tax over the amount that the taxpayer claimed ON THE RETURN to be the correct tax amount -- with both amounts generally computed without regard to how much has actually been "paid" or "unpaid" (i.e., an "apples to apples" comparison). This is a different meaning from the term "deficiency" as used in the case law on tax evasion and other criminal tax statutes, where the term "deficiency" has its more normal, simple, everyday meaning of "unpaid" amount.

Now, let's move to the Court of Appeals. The Court of Appeals generally does not decide questions of fact. The Court of Appeals would not decide whether Mooney actually received $XXX amount of money from Employer Z during 2004. However, the Appeals Court could review the Tax Court's decision about whether the receipt of those dollars constituted an item of "gross income" under section 61 -- that would be a legal issue that the Appeals Court could decide.

Also, without technically deciding a factual issue itself (and this is splitting hairs), the Court of Appeals could also decide that the Tax Court was wrong as a matter of law to decide that a taxpayer actually received $XX dollars of money. Now, this scenario would not apply to the Mooney case if Mooney admitted that he did receive $XX dollars (which I think he did). But let's take a case where a taxpayer denied ever even receiving the dollars (either actually receiving them or even constructively receiving them), and the IRS never even came up with any evidence whatsoever to show that the taxpayer DID receive any money. Taxpayer says, "hey, I never worked for the company, never even heard of them. Never received anything from them." And the IRS just has nothing at all to contradict that. Silly example, maybe -- but in a case like that, if the Tax Court still ruled in favor of the IRS with literally NO EVIDENCE in the case for the IRS position at all, the Appeals Court would probably rule that the Tax Court's finding of fact was incorrect as a matter of law, since there was literally no evidence to support the Tax Court's finding of fact.

To sum up, the Tax Court and the Appeals Court had subject matter jurisdiction over Mooney's case. The question of whether Mooney received certain money would probably be a question of fact, which could be decided by the Tax Court (the trial court). The question of whether the money he received was an item of "section 61 gross income" would, I think, be a question of law. Questions of law can be determined by the Tax Court, but the Appeals Court has the power to either accept or reject the Tax Court's conclusion of law. In fact, that's the basic function of the Appeals Court: To decide questions of law and to reverse the lower court where the lower court got it wrong.

[Doktor Avalanche]

Looks like mutter's conversion to the dark side is nearly complete.

To answer your question from earlier, mutter:

Paralegals get paid the same amount of money wherever they go, regardless of what field of law they specialize in. But that's not to say the money they get is chump change, far from it.

Most paralegals earn $45-50k a year, starting. Like anything else, it's performance based and the better you do the more your earnings potential goes up.

[Famspear]

Mutter, here's another way to look at it.

As an example of the difference between a question of law and a question of fact, let’s suppose that in a contract dispute under the Uniform Commercial Code (UCC) -- which admittedly has virtually nothing to do with federal income tax law -- the parties to the alleged contract (Bob and Joe) are arguing over whether Bob created a “symbol,” in the form of a writing of that party’s name, on a piece of paper – a “writing” labeled as the “contract” -- with the present intention to adopt or accept that writing.

If the parties are arguing over whether Bob actually physically performed the act of picking up the ink pen and writing his name on that paper, or over whether, in performing that act, Bob had the intention to adopt or accept that writing – well, those questions would be “questions of fact.”

By contrast, assume that Bob instead admits that he actually physically performed that act of picking up the ink pen and writing his name, and Bob admits that his intention was to adopt or accept that writing. Instead, Bob argues that this act and its related "intention" simply do not constitute a “signing” for purposes of the UCC. Here, we have a question of law that needs to be decided, not a question of fact.

In Texas, the answer to that question of law would probably be found in the Texas UCC, at Texas Business and Commerce Code section 1.201(37), which states:

(37) "Signed" includes using any symbol executed or adopted with present intention to adopt or accept a writing.

Obviously, Bob probably loses -- on this question of law. Since the fact has been determined (in this case, by Bob simply admitting the fact), the only open issue is: What is the legal significance of the combination of (A) Bob’s action, and (B) Bob’s mental state while he took that action. The answer is clearly stated in section 1.201(37). He "signed" the document -- and whatever legal consequences flow from that, in that particular case, will follow.....

Same thing for section 61 of the Internal Revenue Code. Once the taxpayer admits that he actually received the money, and he admits that he received the money as compensation for personal services (regardless of whether called “wages” or "salary" or whatever), the court can then determine – as a matter of law – that the receipt of that compensation constitutes an item of “gross income” under section 61.

[Famspear]

With regard to Mutter's questions, I think wserra gave a better, more concise, and to-the-point answer than I did with my long-windedness. Too bad I don't get paid by the word, here, though......

[MN Stix]

[Firstly, I wish mutter all the best. I support your looking for information anywhere it can be found. It would be unwise to turn a blind eye to facts. I also want to let you all know that I have a very open mind. I will listen to reason, the following quote will just not do. I will go through it as best I can. Maybe someone else here can make sense of this.


quote="The Operative"]

User MN Stix responded to the thread about Dan's FAQ.

http://losthorizons.com/phpBB/viewtopic.php?t=1299

He basically made a post saying it's absurd to say his labor has $0 value. You might notice, he doesn't even make the slightest attempt to show his opinion has any basis in law (not one citation of one court that agrees with his opinion). By contrast Dan's FAQ cites numerous court cases which strongly disagree with MN Stix's opinion:
[SNIP]

You or anyone attempting to say that labor has 0 value is a joke. Also, it has no basis in law. Please provide the statute, SCOTUS or any other court decision claiming this to be true.
Further, it is not my opinion, it is fact. I have a paycheck to prove it.

Actually, he is right in that it is absurd to say his labor has $0 value. However, that is NOT the contention of the income tax laws or Dan's FAQ.

That is precisely the contention of the income tax and Dan’s FAQ . You, Dan’s FAQ, and IRS is saying just that. Labor = 0, therefore, all labor is “sold” at profit. If that is all the IRS has in its arsenal, I would have a jury laugh them out of court. The value of my labor is $20 per hour worked. That is what I place into my “bank account”, at the end of the week, I withdraw that bank account by paycheck. If I made over $20 per hour worked in my account, that would be the gain or profit. No, labor has value as contracted with your boss.

The contention is that a gain (which is income) is calculated as the difference between what a person PAID for something and what amount he or she SELLS it.

Now you are saying that I purchased my labor for $0 and sold it for a profit of $20 per hour. Sorry, at this point I can barely see I’m laughing so hard.

For example, if a person finds a diamond ring in their backyard that is worth $4,000 and sells it to his or her neighbor for $3,000. Does that person have a $1,000 loss? No, he or she has a $3,000 gain because the gain is calculated as the difference between what he or she PAID for the ring ($0) and the amount for which he or she sold it ($3,000).

Let me get this right, now I “found” my labor and its value is $20? Well yeah, I suppose if I found some magical labor tree, producing magical labor fruit. I then take said magical labor fruit and sell it for anything, that would be profit. So long as the magical labor fruit worked on its own every hour and I did not need to be present to control it.

It is the same with a person's labor.

ROFLMFAO!! Seriously, put down that crack pipe your smoking and get help. Labor is the same thing as finding a diamond ring? If this were provided as an example to a judge, the case would never see the inside of the welcoming area of a courthouse.

It is irrelevant what the labor is worth to the individual selling it to someone else. The gain is the amount for which they sell it (his or her wage or salary) and the amount he or she paid for his or her own labor ($0).

Hold up chief, is it irrelevant? Now you are saying that if I deposit 20 into a bank account and get 5 dollars in interest, I will have to pay tax on all $25. If that were the case, you would never have anyone put money into an interest bearing account. Further, not even the biggest idiot would ever buy stock. I buy $1000 worth of stock and when I cash it out, the value is still $1,000. According to you, I would need to pay a tax on all $1,000.

EDIT: After reading MN STIX additional posting, I feel the need to clarify. While a person does not sell all of his or her capability to labor for all time all at once, a person does sell a period of time of labor for an hourly wage or salary. Once a person works for a paycheck for a certain period of time, that time is gone forever. The amount of energy your body used during that labor is gone until you replenish it. That labor covering that amount of time has been sold by the laborer and the employer paid the laborer for it. It is that simple.

You have given way to complete unintelligible babble. Facts are facts and none of your post reflect that. Legally speaking, it either is or it isn't.

Please link me to where SCOTUS has determined whatever it is you are saying in the last quote. I’m pretty sure that a supreme justice will be able to lay it out properly.

Anyway, I’m here and willing to listen to anything that is somewhat understandable. You show me the code to back up what you are saying. At least a court ruling that compares apples to apples…not diamonds to labor. Although your opinions have value, they are still just opinions. You cannot convict someone by using opinions. Although, It may get persecutors laughed out of court.

[Imalawman]

Stix. What about basis??!?!!?!?! Its not about an exchange of value, but whether the value you received exceeds the tax basis that you have in whatever you're exchanging. Tax basis, tax basis, tax basis......keep saying it.

Under your theory no exchanges or sales would ever be taxable - everything is an equal exchange of value. But rather, under the tax laws, the critical analysis is whether you received value in excess of that which have you paid tax on. Period.

[RyanMcC]

He basically made a post saying it's absurd to say his labor has $0 value. You might notice, he doesn't even make the slightest attempt to show his opinion has any basis in law (not one citation of one court that agrees with his opinion). By contrast Dan's FAQ cites numerous court cases which strongly disagree with MN Stix's opinion:
[SNIP]

You or anyone attempting to say that labor has 0 value is a joke. Also, it has no basis in law. Please provide the statute, SCOTUS or any other court decision claiming this to be true.
Further, it is not my opinion, it is fact. I have a paycheck to prove it.

My fault for not clarifying, your post was about how it was absurd to say your labor has $0 value, I agree with that part. It was your implication that it matters for tax purposes is what every court seems to disagree with.

The rest of your quoted text was written by "The Operative", not me, you quoted it incorrectly.

[Famspear]

Dear MN Stix: First, thanks for your questions.

You are still hung up on the "value" thing. Nowhere does Dan Evans say that labor has zero VALUE. Nowhere does the tax law say labor has zero VALUE. Nowhere does the tax law say that you can deduct the VALUE of your labor.

As I stated yesterday....

. . . .it is as though they [the regulars at losthorizons] really can't really "see" the word "basis" when they read it. When they see the word "basis," I think they must unconsciously replace it with the term "current fair market value."

MN Stix seems to labor under the delusion that "basis" is something that can apply to your personal "labor," and then he deludes himself to think that the amount of basis in your labor is determined by an agreement between you and your employer, etc. -- simply "agreeing" that because your labor has a current fair market value of $XX, that $XX must ALSO be your "basis" in that labor. This is completely in line with the recurrent narcissism we see among many of these people; they "believe" that making up their own rule somehow makes that rule "real."

MN Stix, you are completely, totally, utterly wrong. FORGET ABOUT DEDUCTING VALUE.

Value -- that is, current fair market value -- does come into play -- but not as a DEDUCTION IN ARRIVING AT GAIN FROM LABOR.

Under the Internal Revenue Code, gain is determined by taking the amount realized when you sell something, and deducting something called "adjusted basis" (sometimes just called "basis"). The amount realized is the current fair market value of whatever you RECEIVE. You subtract, from that amount, the basis (NOT THE VALUE) of whatever you are GIVING UP. The net difference, if positive, is a gain. If the basis amount of what you are giving up exceeds the current fair market value of what you are receiving, then you have a loss.

FORGET ABOUT VALUE. CONCENTRATE ON BASIS.

Basis is usually determined by reference to something called historical cost. I'll provide the statutes for you later, but right now, just understand the concept. If I buy a given number of shares of Microsoft stock for $100 today, and then sell that stock for $120 cash a month from now, my basis is $100. I compute my gain by taking the current value of the cash I received at the time of sale ($120), and I deduct the $100 basis in the Microsoft stock, and I have a "realized gain" of $20. THE INTERNAL REVENUE CODE SIMPLY WILL NOT ALLOW ME TO INCREASE MY BASIS JUST BECAUSE THE VALUE OF THE MICROSOFT STOCK WENT UP.

If you do not accept this, then you are lost.

Try to understand.

More to come.....