Wow! What an interesting argument you have made. I agree that the IRS has overstepped its bounds in many areas this being one of them. I'm not a tax expert but taxing us on assets that fluctuate is putting the government at risk. I mean its like taking a bet on a horse race. Sometimes the pony wins but then again.... I don't know. But I do know this- there are only two things that are certain: Death and taxes! (ugh...)
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The problem is, we end up losing either way. That's not constitutional or ethically valid, but it's not going to change if we don't all know what's up!