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Download Taxes As a Weapon Against File-Sharing

Posted by timothy on from the nothing-too-original-because-hey-this-is-hollywood dept.

An anonymous reader writes "An examination of a new "digital downloads" taxation law in Washington State suggests that files downloaded via file sharing programs may be covered by the law — meaning that you may be expected to pay taxes based on 'the value of the digital product ... determined by the retail selling price of a similar digital product.' Thus, if you were to download music or movies and not pay the taxes, would you be liable for tax evasion charges? How much do you want to bet the RIAA will push exactly that claim?"

13 of 451 comments (clear)

  1. Sounds good... by wirelessbuzzers · · Score: 5, Funny

    I'll pay them 8.25% of what I paid for the song.

    --
    I hereby place the above post in the public domain.
    1. Re:Sounds good... by Goldberg's+Pants · · Score: 5, Interesting

      Conceptual issues are irrelevant. The RIAA has big, high paid lawyers who will bend you over a barrel and rape your virgin ass all while telling the judge how you downloaded a song and are now guilty of tax evasion.

      If they got Capone on tax evasion, they can sure as hell get you!

    2. Re:Sounds good... by smellsofbikes · · Score: 5, Informative

      While I certainly can't attempt to answer the above, I do offer IRS Publication 525: Taxable and Nontaxable Income, which offers these gems:
      Bribes. If you receive a bribe, include it in your income.
      Found property. If you find and keep property that does not belong to you that has been lost or abandoned (treasure-trove), it is taxable to you at its fair market value in the first year it is your undisputed possession.
      Illegal activities. Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Form 1040, line 21, or on Schedule C or Schedule C-EZ (Form 1040) if from your self-employment activity.
      Kickbacks. You must include kickbacks, side commissions, push money, or similar payments you receive in your income on Form 1040, line 21, or on Schedule C or Schedule C-EZ (Form 1040) if from your self-employment activity.
      Stolen property. If you steal property, you must report its fair market value in your income in the year you steal it unless in the same year, you return it to its rightful owner.

      --
      Nostalgia's not what it used to be.
    3. Re:Sounds good... by Maxo-Texas · · Score: 5, Interesting

      I think they would need to prove that
      a) I didn't rip it from my CD (and then the CD was lost/broke/destroyed so I no longer own it).
      b) I didn't record it off of the radio.
      c) I didn't record it off of my cable music channels.
      d) I didn't record it off of an internet radio station.
      e) I wasn't given the song by someone else who owned it legally and gave me their only copy.

      Still- it's a novel concept and it motivates the government to do RIAA's enforcement for them. Once again externalizing corporate costs.
      Given the hell that is coming in the economy, I wonder if it will be worth it.

      e) Provides the most interesting possibilities for creating extremely long chains of custody between various people who each legally owned the song and gave it to each other. For example, you could give your only copy of a song (not retaining anything) and take another song from a library. You can do this now legally. We check out DVD's for tv series and movies and CD's for songs from our library. You listen to it for a while and then return it.

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      Something that people always trip up on (in TV shows and in real life) is that lying or conspiring is often a separate crime. So they fail to get you on the original charge but can show that you lied or conspired to break the law and so you are tagged for that. Basically, so much is illegal now that if the government really wants to put you in prison it probably can.

      --
      She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
  2. Drug tax stamps? by argent · · Score: 5, Insightful

    Don't forget to buy your drug tax stamps while you're at the post office.

  3. Re:Impossible to enforce by KPU · · Score: 5, Informative

    No. According to line 33 of page 4 in the bill, computer software is not a digital good. Perhaps not the reason you were hoping for, but it does answer your question.

  4. Re:Impossible to enforce by GMFTatsujin · · Score: 5, Funny

    "Computer software is not a digital good."

    Hell, in most cases it's barely a digital okay. I consider myself lucky to find a digital I can live with it.

  5. Re:No different from sales tax evasion by spun · · Score: 5, Interesting

    Crap. I have free software worth tens of thousands of dollars on my computer at home. I shudder to think how much we have here at work. I'm thinking Microsoft might want in on this action, to put a tax smackdown on Open Source.

    --
    - None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
  6. Re:Taxes only? by rjstanford · · Score: 5, Funny

    So if I was to upload pirated movies, could I claim a tax deduction for their value as well?

    --
    You're special forces then? That's great! I just love your olympics!
  7. Re:Taxes only? by Anonymous Coward · · Score: 5, Funny

    *bludgeons you repeatedly* WERE, WERE. This is not Kentucky!

  8. Re:How is this unreasonable by Twanfox · · Score: 5, Informative

    You can give up to $12,000 (2008) or $13,000 (2009+) in gifts to any single individual through the year and not have to pay a gift tax on it. However, once you gift more than that to any one person, you are obligated by federal law to pay federal taxes on it. At least, that was my understanding when I looked it up last year. However, the person receiving the gift does not have to claim it as income, as the responsibility is placed on the giver.

    Sales tax is a different beast, and yes, is applied when you use the gift card at a location. So nice when the government goes double dipping in the same pool of money.

    Ref: http://www.irs.gov/businesses/small/article/0,,id=108139,00.html

  9. Re:OpenOffice.org by S77IM · · Score: 5, Insightful

    Or, will MS Office become downloadable tax-free, since it is similar to the $0.00 OpenOffice.org?

    --
    Student: Is it true that the foundation of the universe is paradox?
    Master: Well, yes and no.
  10. Re:Impossible to enforce by jyx · · Score: 5, Insightful

    If computer software is not a digital good, what the hell is it? Do legislators live on a planet even remotely similar to ours?