IRS Nabs Pimp

For the last several years the government has been putting a case against Randall Jones for operating six brothels in the Houston area. 

I've been following the case with some interest as two offices I had worked out of were close to, or next to these "Escape Lounges", touted as stress relief places.  I had been amazed that these brothels would advertise and operate in the open without consequence.  In the end the IRS got Jones for tax evasion.

The Houston Chronicle has a post today regarding Jones' sentencing: 33 months and $15,000 in restitution.

The only reason I am posting this, though, is due to a comment from the IRS spokeswoman and a reader's response:

IRS spokeswoman Robin Sabin of Houston said that even income derived from illegal activities has to be reported to the IRS.

She suggested Schedule C for the small-business owner and the 1040 line “other income” for the freelancer. “You should report your ill-gotten gains just like you report any legal income,” Sabin said when Jones entered his guilty plea.

And the reader's response:

CB021 wrote: "which line on the 1040 is for pimping?..."

The story from the Houston Chronicle: http://www.chron.com/disp/story.mpl/metropolitan/6425827.html