Tax madness

Tax Lawyer's blog post today includes tournament brackets for "Tax Madness: All Time Greatest Code Section."

Isn't the term "tax madness" redundant?

Anyhow, this is a fun exercise for us tax geeks. Pappas asks at the end of the post: "What code section do you think is the 'greatest?' "

Being obsessed with detail as I am, I immediately thought: "Well, what do you mean by greatest? Greatest in terms of saving taxpayers money, generating tax revenue, collecting tax revenue, or another definition altogether?"

I drove my professors crazy in college, as you can imagine. ("But what do you mean by this question?" "What if this exception applies?" "What if I read it this way instead?")

Pappas suggests the greatest code section is 3402, reasoning that: "Withholding is the chief administrative mechanism enabling the federal government to collect, without significant protest, sufficient private resources to fund an ever-expanding government."

So I agree that this is the greatest section in terms of tax collection.

I'm thinking "greatest" in terms of the impact on taxpayers, whether for good or ill. And though one could argue that the withholding section has the greatest impact, my inclination would be to crown the code section that imposes the tax in the first place. In general, that's code section 61 (which Pappas named as the runner-up to 3402).

Section 61 says: "Except as otherwise provided in this subtitle gross income means all income from whatever source derived."

Everything is taxable, unless we give you a special hall pass to exclude it. Casts a pretty wide net, eh?