Brief Fact Summary. Plaintiffs purchased a used piano and found $4,467 in cash inside. Plaintiffs originally reported this as income but filed an amended return and sought a refund of the taxes paid on that income.
Synopsis of Rule of Law. Gross income means all income from whatever source derived.
As the Supreme Court has stated, this language was used by Congress to exert in this field the full measure of its taxing power.View Full Point of Law
Issue. Should the found money be included as income?
Held. Judge Young issued the opinion for the United States District Court in holding that the found money should be included as gross income of Plaintiffs.
Discussion. The rule requiring all income to be included as gross income is intentionally broad to allow Congress to use its taxing power broadly under the Sixteenth Amendment. Plaintiffs could not show a specific exception for found money.