You are vacationing in St. Barts and you find $20 while scuba diving.

Scenario : You are vacationing in St. Barts and you find $200,000 in a satchel on the sea floor while scuba diving.

1) Do you think that finding $20 meets the definition of gross income?

2) Is there a materiality threshold for reporting income?

3) Does not reporting the $20 violate tax law and/or ethical standards?

4) Do you think finding $200,000 meets the definition of gross income?

5) Would you be more likely to report the $200,000? Why? Does not reporting the $200,000 violate tax law and/or ethical standards?

Answer rating: 100% (QA)

Yes finding 20 meets the definition of gross income as it represents an increase in your economic w... View the full answer