Tennessee
How Cohen v. United States applies in Tennessee: state-specific rules, key cases, and bar exam notes for Tax Law.
Tennessee law generally follows the federal approach to taxation, specifically regarding the assessment of income and deductions. The principles established in Cohen v. United States regarding the taxation of income from illegal activities are similarly applicable under Tennessee tax law.
In Tennessee, income derived from illegal activities is taxable, and taxpayers are required to report all sources of income, reflecting the precedent established in Cohen.
Held that income from any source, including illegal activities, is taxable and must be reported on state tax returns.
Reiterated that all income that is not specifically exempted by law must be reported for tax purposes, including illicit gains.
Tennessee's approach to the taxability of illegal income aligns with the federal standard set forth in Cohen v. United States. Both jurisdictions emphasize that taxpayers cannot evade taxation by way of the legality of the income source.
Understanding the implications of Cohen v. United States is essential for the Tennessee bar exam, particularly when addressing issues of income taxation and reporting duties.