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Actually if you declare the income and classify it correctly you are clear from an income oersoective; by disclosing the crime you risk confiscation and prosecution but neither would involve the irs beyond certification of your submissions. Source: armchair cpa

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But isn't that the point? If you don't declare the crime you're liable for tax evasion and can be prosecuted by the irs; if you do, you're going to be prosecuted by a different authority. And since nobody is going to self-incriminate, when they catch you you'll be prosecuted both for corruption and tax evasion.

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