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  • US IRC 933

    The US Internal Revenue Code 933 clearly states that income which originates in Puerto Rico which is earned by a citizen of Puerto Rico is not subject to Federal income tax...
    Why is this important?
    Because it completely contradicts the entire premise that Jack moved to Puerto Rico in 2019 in order to avoid paying federal income tax on a chest which he had already found.... The only way that Jack could avoid paying income tax on the value of the treasure by becoming a citizen of Puerto Rico is if he found the chest in Puerto Rico! If it was found anywhere else within the united states even a citizen of Puerto Rico would be subject to Federal income taxes....
    This fact has been repeatedly pointed out both in the forums and on YouTube and yet some continue to push the false narrative that it makes sense for Jack to have moved to Puerto Rico in some sort of genius proactive attempt to avoid paying his fair share of federal income tax.
    If this narrative is true it could only mean one of two things... Either Jack is a complete moron who committed himself to a life altering move based on a false assumption without bothering to do even a rudimentary bit of research to make certain that his hair brained scheme would work or he moved to Puerto Rico for some other reason....
    If it is true, it also makes Jack/ Condor2 a confessed felon... A felon whose ill conceived attempt at tax evasion resulted in yet another searcher death
    Sal O'mander
    Senior Member
    Last edited by Sal O'mander; 01-11-2022, 12:23 PM.

  • #2
    I guess "moron" it is, since Jack specifically mentions moving to Puerto Rico to "take advantage of the 0% capital gains tax incentive there" on September 20, 2019. He applied in Puerto Rico just a week later.
    /r/FindingFennsGold /u/thecondor2 20.9.2019, 04:18:26
    "They found it but remembered how high the short-term capital gains on collectibles are and left it right where it was. They're going to move to Puerto Rico to take advantage of the 0% capital gains tax incentive there, and then go back and take possession of it."

    You can't call him a felon though since he's received no taxable revenue from the treasure chest at all yet. The chest hasn't been sold yet. Except if you think Forrest actually bought it from him which I doubt.

    But how did he afford to move to Puerto Rico without selling the booty he found? Isn't he the college dropout with med school debts who needed to sell it? None of it makes any sense. I don't think he found it in 2019. I think he contracted with Forrest in April 2019 to be the eventual finder when Forrest chose to retrieve it. The moron knew he would be the finder soon. His moron brain concocted all of these schemes (Puerto Rico, Auction Site) to try and maximize his rare opportunity, thinking he had Forrest by the short hairs.

    Kpro is implying that Forrest knew the moron had found the exact spot and kept quiet about it for months. I think that thought is an insult to Forrest. If anyone did that to him, he would just send his grandson to pick it up. After all he'd been through, he would never just sit there like a stooge waiting on the moron and his penny shaving schemes. Think hard on that one Kpro. You should know deep down that would NEVER happen.

    Comment


    • #3
      Originally posted by artislurker View Post
      I guess "moron" it is, since Jack specifically mentions moving to Puerto Rico to "take advantage of the 0% capital gains tax incentive there" on September 20, 2019. He applied in Puerto Rico just a week later.

      You can't call him a felon though since he's received no taxable revenue from the treasure chest at all yet. The chest hasn't been sold yet. Except if you think Forrest actually bought it from him which I doubt.
      I've appreciated your commentary recently, but you are missing something on this one. People on this forum don't seem to understand well the tax law as it relates to treasure trove and abandoned property. The fair market value of the treasure would become taxable income the moment it was found and procured by the founder. This was tested recently when a couple found $10 million worth of gold coins buried in their back yard (or at least so they said). Per an article on same, "In 1969, the United States Federal Court ruled that treasure is taxable the year that it was discovered. “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 in your undisputed possession.” " Note that the inner quote is from the court. The precedent case of 1969, I believe, comes from a person or couple that found a bunch of money stashed inside a piano.

      Capital gains taxes only come into play when the treasure is subsequently sold to another party. The capital gain/(loss) would be the excess of the sale price over its basis - the basis being what he/she had included in their income upon taking possession of it.

      If Jack took "undisputed possession" of the treasure, it does raise the question of how he (by his own admission, a poor medical student who needed to sell the chest to pay off student loans - or something like that), was able to pay his income taxes for the 2020 tax year.


      Comment


      • #4
        Originally posted by Spoon View Post

        I've appreciated your commentary recently, but you are missing something on this one. People on this forum don't seem to understand well the tax law as it relates to treasure trove and abandoned property. The fair market value of the treasure would become taxable income the moment it was found and procured by the founder. This was tested recently when a couple found $10 million worth of gold coins buried in their back yard (or at least so they said). Per an article on same, "In 1969, the United States Federal Court ruled that treasure is taxable the year that it was discovered. “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 in your undisputed possession.” " Note that the inner quote is from the court. The precedent case of 1969, I believe, comes from a person or couple that found a bunch of money stashed inside a piano.

        Capital gains taxes only come into play when the treasure is subsequently sold to another party. The capital gain/(loss) would be the excess of the sale price over its basis - the basis being what he/she had included in their income upon taking possession of it.

        If Jack took "undisputed possession" of the treasure, it does raise the question of how he (by his own admission, a poor medical student who needed to sell the chest to pay off student loans - or something like that), was able to pay his income taxes for the 2020 tax year.

        I don't think you understand the concept of Fenn applying the chest to his lifetime gift tax allowance, and negating any taxes that Jack would owe, which would be ZERO. The only thing in question is how much did Fenn apply towards the gift tax, and will that amount cover the amount that the chest sells for. If Fenn applied 2 million towards the gift tax, and Jack sells it for 2 million, then there would be ZERO capital gains on the sale. Hence this whole PR thing is nonsense.

        Comment


        • #5
          Puerto Rico is not based on him finding it (since he was just "returning it" to Forrest) but on when he was "gifted" the chest by Forrest. I'm still not 100% sure that it would float with the IRS but that's what he was going for. That said, I'm still not convinced that it wasn't for selling the chest location at which point he would have been a PR citizen and is a much clearer IRS issue.

          Comment


          • #6
            Originally posted by artislurker View Post
            I guess "moron" it is, since Jack specifically mentions moving to Puerto Rico to "take advantage of the 0% capital gains tax incentive there" on September 20, 2019. He applied in Puerto Rico just a week later.
            /r/FindingFennsGold /u/thecondor2 20.9.2019, 04:18:26
            "They found it but remembered how high the short-term capital gains on collectibles are and left it right where it was. They're going to move to Puerto Rico to take advantage of the 0% capital gains tax incentive there, and then go back and take possession of it."

            You can't call him a felon though since he's received no taxable revenue from the treasure chest at all yet. The chest hasn't been sold yet. Except if you think Forrest actually bought it from him which I doubt.

            But how did he afford to move to Puerto Rico without selling the booty he found? Isn't he the college dropout with med school debts who needed to sell it? None of it makes any sense. I don't think he found it in 2019. I think he contracted with Forrest in April 2019 to be the eventual finder when Forrest chose to retrieve it. The moron knew he would be the finder soon. His moron brain concocted all of these schemes (Puerto Rico, Auction Site) to try and maximize his rare opportunity, thinking he had Forrest by the short hairs.

            Kpro is implying that Forrest knew the moron had found the exact spot and kept quiet about it for months. I think that thought is an insult to Forrest. If anyone did that to him, he would just send his grandson to pick it up. After all he'd been through, he would never just sit there like a stooge waiting on the moron and his penny shaving schemes. Think hard on that one Kpro. You should know deep down that would NEVER happen.
            I understand your point of view and agree with much of what you are saying, especially the part about What Forrest would have done...
            It is important to note that US IRC also makes clear that moving to Puerto Rico to avoid capital gains taxes is also not an option.. in order for a citizen of Puerto Rico to avoid the assessment of capitol gains taxes the citizen would have to aquire the capital investment while a resident or wait ten years to divest in order to take advantage of this tax incentive... I would argue that Forrest said if you find it, it's yours.... And since Jack clearly had every intention of going back to get it his actions clearly demonstrate an attempt at Felony tax evasion...
            Regardless of wether we are treating it as income or capital gains it is clear from his writings as Condor2 that Jack is attempting to game the system in order to evade taxation and that's a Felony... A clear attempt to hide income or an investment in order to attain a more favorable tax position somewhere down the road ... He better have some really good lawyers!

            If, on the other hand, he contracted with Forrest to play the finder... He could easily do that from someone's basement in Puerto Rico... And would not be subject to any Federal income or capital gains taxes....
            The narrative that Kpro is pushing opens Jack up to both prosecution by the Federal government and civil litigation by the Sexton family ... And if Forrest knew about it his estate would be exposed to the possibility of civil litigation as well...
            There is no way Forrest would have put up with any of this!
            Is Kpro pushing this dangerous narrative in order to put pressure on Jack? Or maybe she is trying to flush out additional lawsuits?

            Comment


            • #7
              Folks that keep poking the hornet's nest eventually get stung.

              Comment


              • #8
                Originally posted by Mark W View Post

                I don't think you understand the concept of Fenn applying the chest to his lifetime gift tax allowance, and negating any taxes that Jack would owe, which would be ZERO. The only thing in question is how much did Fenn apply towards the gift tax, and will that amount cover the amount that the chest sells for. If Fenn applied 2 million towards the gift tax, and Jack sells it for 2 million, then there would be ZERO capital gains on the sale. Hence this whole PR thing is nonsense.
                Yes, I understand it (somewhat) and was aware of that theory. I think it is problematic. I don't believe it meets the definition of a gift under tax law, defined as the immediate transfer of property from one person to another with consideration. The transfer was neither immediate nor was it directed to a particular party. Forrest had no idea who would find that treasure. I don't think you can call it a gift (for tax purposes) if you put money out to possibly be claimed in the future by an unknown party. I could be wrong, but I doubt it.

                Also, IF, on the dubious assumption that it could have been considered a gift for tax purposes, it seems likely that Forrest would have made a point of that being the case at some point during the process. But he didn't. He said in an interview or published article something like, "whoever finds the treasure, the IRS is going to want their share." That doesn't sound like a person who had set aside some of their lifetime gift exemption for the treasure. And I doubt very much that the IRS would treat it as a gift if he decided to do it AFTER the treasure was found.
                Spoon
                Senior Member
                Last edited by Spoon; 01-11-2022, 03:22 PM.

                Comment


                • #9
                  Originally posted by Sal O'mander View Post

                  I understand your point of view and agree with much of what you are saying, especially the part about What Forrest would have done...
                  It is important to note that US IRC also makes clear that moving to Puerto Rico to avoid capital gains taxes is also not an option.. in order for a citizen of Puerto Rico to avoid the assessment of capitol gains taxes the citizen would have to aquire the capital investment while a resident or wait ten years to divest in order to take advantage of this tax incentive... I would argue that Forrest said if you find it, it's yours.... And since Jack clearly had every intention of going back to get it his actions clearly demonstrate an attempt at Felony tax evasion...
                  Regardless of wether we are treating it as income or capital gains it is clear from his writings as Condor2 that Jack is attempting to game the system in order to evade taxation and that's a Felony... A clear attempt to hide income or an investment in order to attain a more favorable tax position somewhere down the road ... He better have some really good lawyers!

                  If, on the other hand, he contracted with Forrest to play the finder... He could easily do that from someone's basement in Puerto Rico... And would not be subject to any Federal income or capital gains taxes....
                  The narrative that Kpro is pushing opens Jack up to both prosecution by the Federal government and civil litigation by the Sexton family ... And if Forrest knew about it his estate would be exposed to the possibility of civil litigation as well...
                  There is no way Forrest would have put up with any of this!
                  Is Kpro pushing this dangerous narrative in order to put pressure on Jack? Or maybe she is trying to flush out additional lawsuits?
                  Yea, we should be careful not to encourage crazy people in doing silly things. I don’t think Z’s family deserves anymore drama. They already lost their Parents/grandparents.

                  Comment


                  • #10
                    Originally posted by Spoon View Post

                    Yes, I understand it (somewhat) and was aware of that theory. I think it is problematic. I don't believe it meets the definition of a gift under tax law, defined as the immediate transfer of property from one person to another with consideration. The transfer was neither immediate nor was it directed to a particular party. Forrest had no idea who would find that treasure. I don't think you can call it a gift (for tax purposes) if you put money out to possibly be claimed in the future by an unknown party. I could be wrong, but I doubt it.

                    Also, IF, on the dubious assumption that it could have considered it a gift for tax purposes, it seems likely that Forrest would have made a point of that being the case at some point during the process. But he didn't. He said in an interview or published article something like, "whoever finds the treasure, the IRS is going to want their share." That doesn't sound like a person who had set aside some of their lifetime gift exemption for the treasure. And I doubt very much that the IRS would treat it as a gift if he decided to do it AFTER the treasure was found.
                    Thing is, it's not a theory. Fenn literally said he gifted the chest to the finder.

                    I'd agree it could not be gifted if the chest was found after he passed away, and I think Fenn always thought he would not see it found during his lifetime. So Fenn had to be alive in order for that to happen, and waiting a year to grab the chest after finding it would be really really stupid considering Fenn didn't have much time left, and I don't see Jack as someone that's stupid. If he's condor then he was well aware of all the implications of finding the chest, and finding it and returning it to Fenn while Fenn was alive would be the number one priority.

                    Comment


                    • #11
                      Originally posted by Sal O'mander View Post
                      If it was found anywhere else within the united states even a citizen of Puerto Rico would be subject to Federal income taxes
                      ok
                      but
                      is it officially confirmed that the chest was found within the united states?
                      as far as I know the US authorities have no conclusive evidence that the chest was found in the US, and that's why Jack has no tax troubles IMO

                      Comment


                      • #12
                        Originally posted by Spoon View Post
                        I've appreciated your commentary recently, but you are missing something on this one. People on this forum don't seem to understand well the tax law as it relates to treasure trove and abandoned property. The fair market value of the treasure would become taxable income the moment it was found and procured by the founder. This was tested recently when a couple found $10 million worth of gold coins buried in their back yard (or at least so they said). Per an article on same, "In 1969, the United States Federal Court ruled that treasure is taxable the year that it was discovered. “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 in your undisputed possession.” " Note that the inner quote is from the court. The precedent case of 1969, I believe, comes from a person or couple that found a bunch of money stashed inside a piano.

                        Capital gains taxes only come into play when the treasure is subsequently sold to another party. The capital gain/(loss) would be the excess of the sale price over its basis - the basis being what he/she had included in their income upon taking possession of it.

                        If Jack took "undisputed possession" of the treasure, it does raise the question of how he (by his own admission, a poor medical student who needed to sell the chest to pay off student loans - or something like that), was able to pay his income taxes for the 2020 tax year.
                        Everything your saying makes good sense to me. I haven't researched any of the legalities around a treasure find. The "capital gains" proposal is a direct quote from Jack as Condor2 so it looks like his research skills aren't all that sharp in this arena either. But I think it points more to the fact that he likely received an initial payment from Forrest for signing on to the be the finder. This enabled him to make the move to Puerto Rico in advance of his payday that would come after Forrest retrieved the chest. Perhaps he owns the chest, perhaps he doesn't. We can only guess on the details of their arrangement. But it could be that he did gain a tax advantage with his move, just as he said he would, based on how Forrest ended up paying him.

                        Comment


                        • #13
                          Originally posted by Mark W View Post

                          Thing is, it's not a theory. Fenn literally said he gifted the chest to the finder.

                          I'd agree it could not be gifted if the chest was found after he passed away, and I think Fenn always thought he would not see it found during his lifetime. So Fenn had to be alive in order for that to happen, and waiting a year to grab the chest after finding it would be really really stupid considering Fenn didn't have much time left, and I don't see Jack as someone that's stupid. If he's condor then he was well aware of all the implications of finding the chest, and finding it and returning it to Fenn while Fenn was alive would be the number one priority.
                          I still think it's a theory. What we have is another person's recall and interpretation of something that Forrest told her. And based upon what I've heard of that story, it wasn't very specific. Not to mention that it sounds like he told her hesitantly and with some reluctance, which is odd given the nature of the information, don't you think? And that still doesn't address the fundamental problem I have with that story: Fenn supposedly gifted it when it was brought to him, AFTER the finder took possession of it. Since Forrest many times stated that whoever found it could keep it, he had given up his rights to it. Unless the finder was employed by Forrest to retrieve it for him, that would make it income upon taking possession. Then a gift from the finder to Forrest, and then another gift from Forrest to the finder - seems like an unnecessary way for each of them to use up part of their gift exemptions. It also seems unlikely that the IRS would just let that one go because they're so flush with revenue. I don't think that's how they operate.

                          The whole ending of this story is shrouded in mystery with as many contradictions as there are theories. I welcome your point of view, but I think it would be foolish for anyone to state that they know definitively what really happened. I don't claim to.

                          Comment


                          • #14
                            Originally posted by Sal O'mander View Post
                            Regardless of wether we are treating it as income or capital gains it is clear from his writings as Condor2 that Jack is attempting to game the system in order to evade taxation and that's a Felony... A clear attempt to hide income or an investment in order to attain a more favorable tax position somewhere down the road ... He better have some really good lawyers!

                            If, on the other hand, he contracted with Forrest to play the finder... He could easily do that from someone's basement in Puerto Rico... And would not be subject to any Federal income or capital gains taxes....
                            The narrative that Kpro is pushing opens Jack up to both prosecution by the Federal government and civil litigation by the Sexton family ... And if Forrest knew about it his estate would be exposed to the possibility of civil litigation as well...
                            There is no way Forrest would have put up with any of this!
                            Is Kpro pushing this dangerous narrative in order to put pressure on Jack? Or maybe she is trying to flush out additional lawsuits?
                            I agree that what Kpro is outlining regarding Jack's attempts to gain the system are a felony. Question is, does he own the chest directly? Or is he being paid in a different way, under contract? If he owns the chest and will sell it, all this disclosure has ended his ability to avoid federal taxes. I don't think he's dumb enough to even attempt to claim now that he found it in 2020 with all of this out. The IRS only needs a hint at impartiality to make a move on him. This is way more than a hint.
                            artislurker
                            Member
                            Last edited by artislurker; 01-12-2022, 08:28 PM.

                            Comment


                            • #15
                              Originally posted by Spoon View Post

                              I still think it's a theory. What we have is another person's recall and interpretation of something that Forrest told her. And based upon what I've heard of that story, it wasn't very specific. Not to mention that it sounds like he told her hesitantly and with some reluctance, which is odd given the nature of the information, don't you think? And that still doesn't address the fundamental problem I have with that story: Fenn supposedly gifted it when it was brought to him, AFTER the finder took possession of it.
                              Which is why you wouldn't take possession of it immediately, which is what Jack said he did. What if there were a note in the chest that stated exactly what you needed to do, like maybe contact Fenn before you take possession. What if during that time Fenn sent Jack written permission to bring his chest back to him without taking ownership.

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