"I borrowed $50,000 from the bank. Now the IRS is telling me I have to pay tax on that money. I am able to repay it as agreed. I am not in default on the loan." I pointed out the cancellation of debt income provisions, but this agent says that doesn't matter. This borrow money is still considered income and therefore taxable.
Is the IRS correct? Why or why not?
Additional Directions
-For full credit you must consider the reader a tax court judge.
- You must submit a written argument that:
A. Cites the constitution
B. Cites the internal revenue code, and/or case law to support your position. (include citations to sources)