Tax consequences of selling a homebuilt.

[[email protected]]

A question came up over pizza the other night.

What are the tax consequenes of selling a homebuilt?

Assume we know how much the raw materials cost.
Assume we know approx how many hours of labor went into it.

Assume the homebuilt is worth >$200K

If it is sold what are the tax implications?

[Ron Natalie]

wrote:
> A question came up over pizza the other night.
>
> What are the tax consequenes of selling a homebuilt?
>
> Assume we know how much the raw materials cost.
> Assume we know approx how many hours of labor went into it.
>
> Assume the homebuilt is worth >$200K
>
> If it is sold what are the tax implications?
>

Labor (unless you paid someone to do the labor)
has no bearing on the issue. You are presumably
doing this for recreation or education, that is,
not as a business. You have a capital gain on
the difference between what you spent on the
materials and the what you sold it for. If you
have a loss, however, that is not deductible.

[karel]

> wrote in message
ups.com...
>A question came up over pizza the other night.
>
> What are the tax consequenes of selling a homebuilt?
>
> Assume we know how much the raw materials cost.
> Assume we know approx how many hours of labor went into it.
>
> Assume the homebuilt is worth >$200K
>
> If it is sold what are the tax implications?

Don't know where you are
but over here you'd sure have
the VAT administration on your back.

[Philippe Vessaire]

wrote:

> A question came up over pizza the other night.
>
> What are the tax consequenes of selling a homebuilt?
>
> Assume we know how much the raw materials cost.
> Assume we know approx how many hours of labor went into it.
>
> Assume the homebuilt is worth >$200K
>
> If it is sold what are the tax implications?

For french "tresor public" : zéro euros

By
--
Pub: http://www.slowfood.fr/france
Philippe Vessaire Ò¿Ó¬

[J.Kahn]

Ron Natalie wrote:
> wrote:
>> A question came up over pizza the other night.
>>
>> What are the tax consequenes of selling a homebuilt?
>>
>> Assume we know how much the raw materials cost.
>> Assume we know approx how many hours of labor went into it.
>>
>> Assume the homebuilt is worth >$200K
>>
>> If it is sold what are the tax implications?
>>
>
> Labor (unless you paid someone to do the labor)
> has no bearing on the issue. You are presumably
> doing this for recreation or education, that is,
> not as a business. You have a capital gain on
> the difference between what you spent on the
> materials and the what you sold it for. If you
> have a loss, however, that is not deductible.

I don't think capital gains applies there. The materials weren't
purchased as an "investment". I believe that the IRS or (Revenue Canada
up here) would have to see a pattern of construction and sales of
aircraft that would indicate that the activity is professional in nature
before they would consider the profits from the sale as income.

I would certainly not report the proceeds of a single aircraft built
over 4 years as income or capital gains any more I would over a car I'd
restored, unless I was doing it full time specifically as a source of
income.

John

[TxSrv]

J.Kahn wrote:
>
> I don't think capital gains applies there. The materials weren't
> purchased as an "investment". I believe that the IRS or (Revenue Canada
> up here) would have to see a pattern of construction and sales of
> aircraft that would indicate that the activity is professional in nature
> before they would consider the profits from the sale as income.

In the U.S., it is most definitely taxable if sold at a
gain. The tax law does not distinguish between personal,
business, or investment assets (except that a loss on sale
of a personal asset is not deductible).

Fred F.

[Don W]

Okay, short answer for the USA. (I don't know
Canadian law).

If you sell an airplane, homebuilt or not, for
more than you paid for it the difference is
"capital gain" and you have to file a Schedule D
with your 1040 at tax time.

[longer explanation]
A lot of people incorrectly believe that capital
gains only applies to investments or real estate.
It does not. It actually applies to anything
you buy and resell including for example guns,
art, furniture...

In most cases it is assumed that what you buy will
have depreciated, and you will sell it for less
than you paid for it, and in that case you have a
capital loss, not a capital gain. Capital losses
can only be written off against capital gains
except for $3000.00 per year which can be written
off against ordinary income.

Now back to the airplane. What did you actually
pay for it? Well obviously you have to add up all
of the materials and avionics, paint, etc. If you
had someone else paint it and you paid them to do
it, that is part of your "cost basis". If you
paid someone else to overhaul the engine you can
add that to your "cost basis". However, you
cannot increase your cost basis by any of your own
labor and you would not want to even if you could,
because then the amount that you said you paid
yourself would be ordinary income instead of
capital gains, and you would owe self-employment
tax and your marginal ordinary income rate on that
amount. It would almost certainly be higher than
the current rate for long term capital gains. (I
believe that it is 15% currently).

If you want more information about capital gains
tax, see the following links

http://www.irs.gov/taxtopics/tc409.html
http://www.irs.gov/newsroom/article/0,,id=106799,00.html

you can also download the instructions for
schedule D directly from the IRS website

Don W.

J.Kahn wrote:
> Ron Natalie wrote:
>
>> wrote:
>>
>>> A question came up over pizza the other night.
>>>
>>> What are the tax consequenes of selling a homebuilt?
>>>
>>> Assume we know how much the raw materials cost.
>>> Assume we know approx how many hours of labor went into it.
>>>
>>> Assume the homebuilt is worth >$200K
>>>
>>> If it is sold what are the tax implications?
>>>
>>
>> Labor (unless you paid someone to do the labor)
>> has no bearing on the issue. You are presumably
>> doing this for recreation or education, that is,
>> not as a business. You have a capital gain on
>> the difference between what you spent on the
>> materials and the what you sold it for. If you
>> have a loss, however, that is not deductible.
>
>
> I don't think capital gains applies there. The materials weren't
> purchased as an "investment". I believe that the IRS or (Revenue Canada
> up here) would have to see a pattern of construction and sales of
> aircraft that would indicate that the activity is professional in nature
> before they would consider the profits from the sale as income.
>
> I would certainly not report the proceeds of a single aircraft built
> over 4 years as income or capital gains any more I would over a car I'd
> restored, unless I was doing it full time specifically as a source of
> income.
>
> John

[Ron Natalie]

J.Kahn wrote:

> I don't think capital gains applies there. The materials weren't
> purchased as an "investment".

Makes no difference in the US.

I believe that the IRS or (Revenue Canada
> up here) would have to see a pattern of construction and sales of
> aircraft that would indicate that the activity is professional in nature
> before they would consider the profits from the sale as income.

Absolutely false.

[J.Kahn]

Ron Natalie wrote:
> J.Kahn wrote:
>
>> I don't think capital gains applies there. The materials weren't
>> purchased as an "investment".
>
> Makes no difference in the US.
>
> I believe that the IRS or (Revenue Canada
>> up here) would have to see a pattern of construction and sales of
>> aircraft that would indicate that the activity is professional in
>> nature before they would consider the profits from the sale as income.
>
> Absolutely false.

Don explained it pretty good.

Is it possible to have the aircraft appraised upon completion to
establish a base line value, then pay gains tax on the increase from
that upon sale? It seems grossly unfair to be taxed on the full
difference between the original materials cost and the later sale price.

For example, in Canada you don't pay capital gains tax on a personal
residence but you do on income property. If you live in a house and
then move out and rent it, capital gains applies only to the increase in
value while it was a rental, not the whole time you owned it. Upon
sale you have to have an appraiser do an historical appraisal to
establish the house's market value at the time it became an income
property. In the case of an aircraft you would establish the market
value at the time it was completed and pay tax on the increase from that.

John

[Ron Natalie]

J.Kahn wrote:

> Is it possible to have the aircraft appraised upon completion to
> establish a base line value, then pay gains tax on the increase from
> that upon sale? It seems grossly unfair to be taxed on the full
> difference between the original materials cost and the later sale price.

That's the wway it is.

>
> For example, in Canada you don't pay capital gains tax on a personal
> residence but you do on income property.

In the US you owe capital gains on your residence, but there is an
exclusion of $250,000 if it is your principle residence for 2 out of
the last 5 years.

There's no such exclusion for most anything else/

[Don W]

Ron Natalie wrote:
> In the US you owe capital gains on your residence, but there is an
> exclusion of $250,000 if it is your principle residence for 2 out of
> the last 5 years.
>
> There's no such exclusion for most anything else/

IIRC the exclusion for your principle residence is
$250K per person, so if you are married filing
jointly you can take a $500K capital gains
exclusion on the sale of your principle residence.

Don W.

[Ron Natalie]

Don W wrote:
>
> Ron Natalie wrote:
>> In the US you owe capital gains on your residence, but there is an
>> exclusion of $250,000 if it is your principle residence for 2 out of
>> the last 5 years.
>>
>> There's no such exclusion for most anything else/
>
> IIRC the exclusion for your principle residence is $250K per person, so
> if you are married filing jointly you can take a $500K capital gains
> exclusion on the sale of your principle residence.
>
> Don W.
>
Yes, each owner can exclude up to $250,000 if he meets the 24in60
principle residence test. The only thing marriage does is allow you to
take the deduction without strictly being on the deed.

[Ernest Christley]

Ron Natalie wrote:
> Don W wrote:
>>
>> Ron Natalie wrote:
>>> In the US you owe capital gains on your residence, but there is an
>>> exclusion of $250,000 if it is your principle residence for 2 out of
>>> the last 5 years.
>>>
>>> There's no such exclusion for most anything else/
>>
>> IIRC the exclusion for your principle residence is $250K per person,
>> so if you are married filing jointly you can take a $500K capital
>> gains exclusion on the sale of your principle residence.
>>
>> Don W.
>>
> Yes, each owner can exclude up to $250,000 if he meets the 24in60
> principle residence test. The only thing marriage does is allow you to
> take the deduction without strictly being on the deed.

My wife being a real-estate agent, I can confidently attest that it is a
lot more complicated than that. But this is the US tax code we speak
of, so you already knew that didn't you? There is a whole list of
exclusions, inclusions and dependancies based on when you bought the
house, and which way the wind is blowing when you get audited. You can
also have a vacation home fall under these rules.

So bringing it back to the tax ramifications on a homebuilt. As we all
know, a homebuilt project is never done. If you're paying the capital
gains on the appreciation between when it was finished and when it was
sold, then I just completed it or a restoration (define restoration) the
week before I sold it.

[TxSrv]

Ernest Christley wrote:
> ....
> So bringing it back to the tax ramifications on a homebuilt. As we all
> know, a homebuilt project is never done. If you're paying the capital
> gains on the appreciation between when it was finished and when it was
> sold, then I just completed it or a restoration (define restoration) the
> week before I sold it.

Nice try, but the U.S. tax Code figures any gain as the
difference between hard costs (basis) since day one and net sales
price.

Fred F.

[who cares?]

In article >, TxSrv > wrote:
>Ernest Christley wrote:
>> ....
>> So bringing it back to the tax ramifications on a homebuilt. As we all
>> know, a homebuilt project is never done. If you're paying the capital
>> gains on the appreciation between when it was finished and when it was
>> sold, then I just completed it or a restoration (define restoration) the
>> week before I sold it.
>
>Nice try, but the U.S. tax Code figures any gain as the
>difference between hard costs (basis) since day one and net sales
>price.
>
>Fred F.


Can you deduct your mileage while driving to & from the airport to build? Or
driving around buying parts & materials?

How about hangar rent while building?

[Drew Dalgleish]

On Thu, 07 Sep 2006 00:22:27 GMT, (who cares?)
wrote:

>In article >, TxSrv > wrote:
>>Ernest Christley wrote:
>>> ....
>>> So bringing it back to the tax ramifications on a homebuilt. As we all
>>> know, a homebuilt project is never done. If you're paying the capital
>>> gains on the appreciation between when it was finished and when it was
>>> sold, then I just completed it or a restoration (define restoration) the
>>> week before I sold it.
>>
>>Nice try, but the U.S. tax Code figures any gain as the
>>difference between hard costs (basis) since day one and net sales
>>price.
>>
>>Fred F.
>
>
>Can you deduct your mileage while driving to & from the airport to build? Or
>driving around buying parts & materials?
>
>How about hangar rent while building?

sure those sound like hard costs to me. I think all the gas you burn
while "test flying" your creation should count too.

[TxSrv]

who cares? wrote:
>
> Can you deduct your mileage while driving to & from the airport to build? Or
> driving around buying parts & materials?
>
> How about hangar rent while building?

I really don't think so, but not solely because of tax law. If
building an airplane with the intent of selling at a profit, then
you're afoul of FAA's amateur-built rules. Can't have it both
ways. Under tax law, there's further problems in adding such
costs to basis of aircraft sold, as to what tax Code section you
may legally do that. Unless you really are in the ongoing,
regular business of selling planes you build for profit, and then
you are clearly afoul of the amateur-built rules.

Fred F.

[Rich S.[_1_]]

"TxSrv" > wrote in message
. ..
> I really don't think so, but not solely because of tax law.

Don't tell, don't smell.

Rich S.

[TxSrv]

Drew Dalgleish wrote:
>> Can you deduct your mileage while driving to & from the airport to build? Or
>> driving around buying parts & materials?
>>
>> How about hangar rent while building?
>
> sure those sound like hard costs to me. I think all the gas you burn
> while "test flying" your creation should count too.

Nope there too. Tax statutes are actually precisely structured to
prevent the deduction of logical nonsense. Unless you're in the
trade or business of building airplanes for profit. To preserve
deduction (under either section 162 or 263A of the tax Code), be
sure to tell your FAA or DAR inspector guy of what you're
really doing. :-)

Fred F.

[Ron Natalie]

Ernest Christley wrote:

> My wife being a real-estate agent, I can confidently attest that it is a
> lot more complicated than that. But this is the US tax code we speak
> of, so you already knew that didn't you? There is a whole list of
> exclusions, inclusions and dependancies based on when you bought the
> house, and which way the wind is blowing when you get audited. You can
> also have a vacation home fall under these rules.

It's complicated, but when you bought the house has NO bearing on it
(other than obviously that you must have bought it at least two years
earlier unless you get one of the special exceptions for "involuntary"
sale). The only other obvious mess is if you rolled the profit from the
sale of a house previously (under the old rules) into the current house.
All that does is change your basis. It doesn't change the capital
gains exclusion. The only other vagaries are how do you establish
that you were actually using the property for the primary residence
(especially if you have more than one property you are living in).

>
> So bringing it back to the tax ramifications on a homebuilt. As we all
> know, a homebuilt project is never done. If you're paying the capital
> gains on the appreciation between when it was finished and when it was
> sold, then I just completed it or a restoration (define restoration) the
> week before I sold it.

It has nothing to do when it was finished. Your basis is your cost
outlay on it.

[Roger[_4_]]

On Thu, 07 Sep 2006 12:26:40 -0400, Ron Natalie >
wrote:

>Ernest Christley wrote:
>
>> My wife being a real-estate agent, I can confidently attest that it is a
>> lot more complicated than that. But this is the US tax code we speak
>> of, so you already knew that didn't you? There is a whole list of
>> exclusions, inclusions and dependancies based on when you bought the
>> house, and which way the wind is blowing when you get audited. You can
>> also have a vacation home fall under these rules.
>
>It's complicated, but when you bought the house has NO bearing on it
>(other than obviously that you must have bought it at least two years
>earlier unless you get one of the special exceptions for "involuntary"
>sale). The only other obvious mess is if you rolled the profit from the
>sale of a house previously (under the old rules) into the current house.
>All that does is change your basis. It doesn't change the capital
>gains exclusion. The only other vagaries are how do you establish
>that you were actually using the property for the primary residence
>(especially if you have more than one property you are living in).
>
>>
>> So bringing it back to the tax ramifications on a homebuilt. As we all
>> know, a homebuilt project is never done. If you're paying the capital
>> gains on the appreciation between when it was finished and when it was
>> sold, then I just completed it or a restoration (define restoration) the
>> week before I sold it.
>
>It has nothing to do when it was finished. Your basis is your cost
>outlay on it.

For the G-III I'm even keeping the sales slips for the steel I use to
build the construction fixtures. Paint, glue, resin, Tools used on
and worn out in the building process. I have a whole set of tools
just for the G-III. If they're still any good after finishing the
project I'll sell them and the difference will be their cost.

Unfortunately they won't let me deduct the shop even though it was
built specifically for the purpose of building the G-III.

Roger Halstead (K8RI & ARRL life member)
(N833R, S# CD-2 Worlds oldest Debonair)
www.rogerhalstead.com

[Ernest Christley]

Ron Natalie wrote:
> Ernest Christley wrote:
>
>> My wife being a real-estate agent, I can confidently attest that it is
>> a lot more complicated than that. But this is the US tax code we
>> speak of, so you already knew that didn't you? There is a whole list
>> of exclusions, inclusions and dependancies based on when you bought
>> the house, and which way the wind is blowing when you get audited.
>> You can also have a vacation home fall under these rules.
>
> It's complicated, but when you bought the house has NO bearing on it
> (other than obviously that you must have bought it at least two years
> earlier unless you get one of the special exceptions for "involuntary"
> sale). The only other obvious mess is if you rolled the profit from the
> sale of a house previously (under the old rules) into the current house.
> All that does is change your basis. It doesn't change the capital
> gains exclusion.

When you bought can most certainly have all sorts of implications, and
what you did at that time can also have all sorts of ramifications.
Read IRS Publication 523 and count the number of times phrases like
"before July 19, 1984" appear. No, none of the rules appear to change
the current capital gains exclusion, but very few people outside of
California or the Washington, DC area will every realize a gain of over
$250K. Since capital GAIN cannot exist without a BASIS the idea that
"all that does is change your basis" is rather silly. When considering
any delta, where you start is as important as where you finish.

This guy goes into a situation that just makes my head hurt.

http://www.washingtonpost.com/wp-dyn/content/article/2006/05/26/AR2006052600807.html

Not sure how to relate this back to the 'built' part of homebuilt.

[Roger (K8RI)]

On Tue, 05 Sep 2006 03:15:21 -0400, Ron Natalie >
wrote:

>J.Kahn wrote:
>
>> Is it possible to have the aircraft appraised upon completion to
>> establish a base line value, then pay gains tax on the increase from
>> that upon sale? It seems grossly unfair to be taxed on the full
>> difference between the original materials cost and the later sale price.
>
>That's the wway it is.

And it applies to *everything* you sell. They just don't normally
bother with small items.

>
>>
>> For example, in Canada you don't pay capital gains tax on a personal
>> residence but you do on income property.
>
>In the US you owe capital gains on your residence, but there is an
>exclusion of $250,000 if it is your principle residence for 2 out of
>the last 5 years.
>
>There's no such exclusion for most anything else/
Roger Halstead (K8RI & ARRL life member)
(N833R, S# CD-2 Worlds oldest Debonair)
www.rogerhalstead.com

[Don W]

Roger (K8RI) wrote:

> On Tue, 05 Sep 2006 03:15:21 -0400, Ron Natalie >
> wrote:
>
>
>>J.Kahn wrote:
>>
>>
>>>Is it possible to have the aircraft appraised upon completion to
>>>establish a base line value, then pay gains tax on the increase from
>>>that upon sale? It seems grossly unfair to be taxed on the full
>>>difference between the original materials cost and the later sale price.

Actually, by paying capital gains on the cost
difference, and ignoring your labor you ARE
getting a tax break although it might not seem
like it at first. They are letting you get away
with paying capital gains on income that was
derived from your labor. Normally that would be
self-employment income, and you would have to pay
the higher rate plus ~17% for Social Security and
Medicare. (USA)

>>
>>That's the wway it is.
>
>
> And it applies to *everything* you sell. They just don't normally
> bother with small items.

Amen to that.

Don W.

[Convair]

So few homebuilt designs can be sold for much more than the materials
cost, it hasn't been much of an issue in the past. There are a few
designs than you can make some money on, but most of the profits would
be marginal at best. And if the plane were sold with no mention of it
made at tax time, it would be a very rare event for the IRS to
investigate it. They'd have to be looking at you for something else to
run across something like that. But if your record keeping is poor,
like mine is, it may be very difficult to get a good handle on what
you spent on materials. And what if some of the parts were bought at
the flymarket for cash? And you have no receipt? Private sellers at
flymarkets rarely give receipts. It would seem the answer would be to
jot down the expenditures in your builder's log or in a ledger for
items bought that way. They couldn't disallow the materials cost
because you don't have a receipt for every item. Obviously, if you
have the parts, you had to pay for them, they just don't pop in out of
thin air. I've seen entire kits for sale at the fly markets, and they
are usually cash deals. Plus, abandoned kits are offered for sale in
Trade a Plane, many of which are paid for in cash. The IRS can't
disallow an expenditure because you used cash to pay for it. If you
record the purchase, they have to accept that. If not, take 'em to tax
court over it. At least with a kit purchased from an ad, you could go
back to the seller to verify the sales price, but the fly markets
sometimes are more anonymous.

[TxSrv]

Convair wrote:
> ... And if the plane were sold with no mention of it
> made at tax time, it would be a very rare event for
> the IRS to investigate it.

If there's a substantial gain on sale, that's tax evasion, a
crime. All it takes is an informant to get the ball
rolling. IRS occasionally uses FAA records of aircraft sales
in a project to look for possibilities.

> They couldn't disallow the materials cost because you
> don't have a receipt for every item. Obviously, if you
> have the parts, you had to pay for them, they just don't
> pop in out of thin air....
> If you record the purchase, they have to accept that.
> If not, take 'em to tax court over it.

You'll lose in Tax Court. IRS may have to allow a partial
deduction for inadequate records if you're in business, but
that rule (the "Cohan rule") does not apply to a personal
asset sale. Tax Court litigation is so expensive, that
you'll end setting anyway at best; but the tax rate is only
15%. If you're shy on receipts for $10,000 in parts, that's
$1,500 tax, but it may cost $2,500 for an attorney to appeal
the case. So you accept the examiner's "settlement" offer
of $1,500 tax deficiency.

Fred F.

[newsreader]

On Thu, 14 Sep 2006 11:18:35 -0400, TxSrv > wrote:

>Convair wrote:
>> ... And if the plane were sold with no mention of it
>> made at tax time, it would be a very rare event for
> > the IRS to investigate it.
>
>If there's a substantial gain on sale, that's tax evasion, a
>crime. All it takes is an informant to get the ball
>rolling. IRS occasionally uses FAA records of aircraft sales
>in a project to look for possibilities.
>
>> They couldn't disallow the materials cost because you
>> don't have a receipt for every item. Obviously, if you
>> have the parts, you had to pay for them, they just don't
>> pop in out of thin air....
>> If you record the purchase, they have to accept that.
>> If not, take 'em to tax court over it.
>
>You'll lose in Tax Court. IRS may have to allow a partial
>deduction for inadequate records if you're in business, but
>that rule (the "Cohan rule") does not apply to a personal
>asset sale. Tax Court litigation is so expensive, that
>you'll end setting anyway at best; but the tax rate is only
>15%. If you're shy on receipts for $10,000 in parts, that's
>$1,500 tax, but it may cost $2,500 for an attorney to appeal
>the case. So you accept the examiner's "settlement" offer
>of $1,500 tax deficiency.
>
>Fred F.


Informants? The IRS tactics sound more like the Gestepo and KGB, than
a government agency. But it's good to know. Thanks for the tips on
what to aviod.

[Don W]

>
> Informants? The IRS tactics sound more like the Gestepo and KGB, than
> a government agency. But it's good to know. Thanks for the tips on
> what to aviod.

Actually, in most cases the "informant" is an
ex-wife, ex-girlfriend, ex-partner, or ex-friend,
so it is not they keep paid informants.

So, if you are not reporting all of your income it
really pays to not **** off the other people
that might know or suspect.

Also, pay attention to what the other poster said
about keeping receipts and tax court. When
dealing with the IRS the burden of proof is on you
when you claim a deduction or expense. They do
not have to take your word for it.

Don W.

[TxSrv]

newsreader wrote:
> ...
> Informants? The IRS tactics sound more like the Gestepo and KGB, than
> a government agency. But it's good to know. Thanks for the tips on
> what to aviod.

IRS is just the recipient of info supplied by "good citizens."
Often people who do not report a transaction not on Form 1099
can't resist bragging to others about it.

F--

[karel]

"newsreader" > wrote in message
...

> Informants? The IRS tactics sound more like the Gestepo and KGB, than
> a government agency.

(OT)
And what do you think Gestapo and KGB were/are,
except government agencies?

[newsreader]

On Thu, 14 Sep 2006 15:25:09 -0400, TxSrv > wrote:

>newsreader wrote:
>> ...
>> Informants? The IRS tactics sound more like the Gestepo and KGB, than
>> a government agency. But it's good to know. Thanks for the tips on
>> what to aviod.
>
>IRS is just the recipient of info supplied by "good citizens."
>Often people who do not report a transaction not on Form 1099
>can't resist bragging to others about it.
>
>F--

Yes, good info. One might sell his plane, and learn to keep his mouth
shut about it to everyone. I still wouldn't mention it at tax time.
I'll take my chances. You take yours. But it will be the quietest sale
in history.

[newsreader]

On Thu, 14 Sep 2006 19:48:31 -0000, "karel"
> wrote:

>
>"newsreader" > wrote in message
...
>
>> Informants? The IRS tactics sound more like the Gestepo and KGB, than
>> a government agency.
>
>(OT)
>And what do you think Gestapo and KGB were/are,
>except government agencies?
>

So true. Our IRS somtimes resorts to "questionable" tactics. One book
I read that was a great read was Victor Belinko's about when he
defected in that Mig 25 to Japan. It was good in another way, as he
did a great job of describing life under Soviet rule. He said the KGB
man would show up at the airport just about every day. He would say,
"good day, what do you hear?" It wouldn't surprise me to see IRS
agents showing up here and there, saying "what do you hear?"