Newspaper article THE JOURNAL RECORD

IRS Power Confirmed

Newspaper article THE JOURNAL RECORD

IRS Power Confirmed

Article excerpt

WASHINGTON (AP) -- The Internal Revenue Service can use estimates to make sure it is collecting enough taxes on cash restaurant tips, the Supreme Court said Monday.

The court beefed up the IRS' power to calculate taxes that businesses owe from employees' tips, a thorny task because often the tips are cash and workers report their own earnings.

The ruling is a defeat for the estimated 200,000 restaurants with tipped workers, and many other businesses whose employees receive tips.

The court said the IRS can estimate the amount of cash tips given to employees based on tips shown on credit card receipts. The estimate is used to determine taxes.

Nationwide, employees reported collecting $14.3 billion in tips in 1999, although the IRS suspects that amount could be higher and has been working with restaurants to improve reporting.

The case is United States vs. Fior d'Italia, 01-463.

No reading of rights needed for public transport search

WASHINGTON (AP) -- The Supreme Court ruled Monday that police who want to look for drugs or evidence of other crimes do not have to first inform public transportation passengers of their legal rights.

The ruling gives police guidance on how to approach and search passengers, a case with renewed interest as officers seek out possible terrorists on public transportation.

Justices rejected arguments that passengers, confined to small spaces, might feel coerced.

The court ruled 6-3 that officers in Tallahassee, Fla., were within their rights as they questioned and searched two men aboard a Greyhound bus in 1999.

Justice Anthony M. Kennedy, writing for the majority, said the passengers did not have to be told that they didn't have to cooperate.

Three officers boarded the bus, bound from Fort Lauderdale to Detroit. One officer introduced himself to Christopher Drayton and Clifton Brown, and told them he was looking for illegal drugs and weapons. He asked to pat down the men's baggy clothing. The men agreed, and officers felt hard objects on the men's legs that turned out to be packets of cocaine.

"It is beyond question that had this encounter occurred on the street, it would be constitutional. The fact that an encounter takes place on a bus does not on its own transform standard police questioning of citizens into an illegal seizure," Kennedy wrote for the court.

Drayton and Brown were convicted and sentenced on drug charges.

The 11th U.S. Circuit Court of Appeals ruled the cocaine should not have been admitted as evidence, because the officers failed to tell the men they were not required to cooperate. That court said the encounter violated the Constitution's ban on unreasonable searches and seizures.

Monday's ruling overturns that decision.

Court saves governments from some ADA lawsuits

WASHINGTON (AP) -- The Supreme Court barred Americans from seeking damage awards from cities and government boards that refuse to build wheelchair ramps and make other accommodations for the disabled. …

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