Are gains derived from dealings in property included in gross income?

Gains derived from dealings in property are indeed included in gross income as a general principle in tax law. This inclusivity is part of the broader understanding that the Internal Revenue Code treats gains from the sale or exchange of property as realizable income. When an individual or entity sells or exchanges a capital asset, the profit from that transaction typically constitutes taxable income.

The rationale is that such gains represent an increase in wealth that the taxpayer has realized, and the tax system is structured to tax realized gains to reflect the ability to pay. This is applicable regardless of the type of property, whether it be real estate, stocks, or other tangible assets, unless specific exclusions apply under certain provisions of the tax code.

Gains are taxed in the year they are realized, meaning that once a property is sold or exchanged, any profit made is added to the taxpayer's gross income for that tax year.