Form TD F 90-22.1 and the $10K Time Bomb

[gaboonviper]

For those of you who are unfamiliar with it, Form TD F 90-22.1(Report of Foreign Bank Account and Financial Accounts) is the form you MUST file if at any one time you had a $10k or more lump sum of cash in any foreign financial account. This of course INCLUDES NETELLER. It matters not how long you kept it there, could be as little as a day. The standout here is $10k lump sum at any one time. The penalties for not filing this form are severe as will be covered, and should not be ignored.

Now that Neteller has opened its books to the feds they will now know exactly how much cash you were keeping at Neteller at any one time for any given year. If you ever had $10k or more sitting there and neglected to file Form TD F 90-22.1 with the IRS, for whatever year the money was there, the feds will catch it and you could have a financial time bomb waiting to explode.

The penalties for not filing Form TD F 90-22.1 are severe. Failing to file is considered a misdemeanor with a MINIMUM penality of $25k. In some cases the misdemeanor can be elevated to a felony which as you can imagine can get real, real bad. And you are also guaranteed a very hostile audit by the IRS. You can get more detailed info on this via a google search or your accountant. I cannot cover it all in one post.

Well, for year 2006 obviously you can fill out the form if it applies to you and be safe. But the real problem is that I would guess many of you did not file this form for PREVIOUS years as you should have. And now with Neteller opening their records the feds WILL SEE THAT. I cannot tell you what to do but there are basically two options:

Option 1: File for the years you neglected to file for. This may seem foolish to some of you but you may be better off this way than having them catch you and come to you with charges. Here you may get off with fewer penalties and a less hostile audit. But you are probably still screwed.

Option 2: Wait for them to catch you. Good luck with this option. Here you are guaranteed penalties and beyond, as well a hostile IRS audit. Here you are really screwed.

Bottom line is that if you did not file Form TD F 90-22.1 for any year that you should have, the feds-- via Neteller opening their records-- now KNOW ABOUT IT. What you do about this is up to you.

[BigBiceps]

*** You are ignoring this user ***

I ignored you after your first 3 posts, how are you not banned yet?

[MasterLJ]

WARNING 2+2ers!!!

IF YOU MURDER SOMEONE, YOU WILL BE JAILED!!1!!! PROBABLY FOR A WHILE!

[DING-DONG YO]

go away dude.

And this is just speculating, but as a precedent was never really set as to whether neteller constituted a foreign financial account (although most here feels it would), I find it highly unlikely that the IRS would treat a taxpayer's failure to file this form for a neteller account as harshly as they would someone who say, failed to file for a Swiss/Caymen account.

And ban gaboonviper plz

[Subfallen]

Actually precedent HAS been set, numerous 2+2'ers have confirmed via [email protected] that Neteller accounts require a TD F 90-22.1

However, penalties for not filing are only assessed in conjunction with an audit and at the discretion of the auditor. If you've paid all your taxes I don't think it's going to be the end of the world just because you didn't know about the Bank Secrecy Act.

[DING-DONG YO]

When I said precedent, I was speaking more about actual cases or published guidance.

I know the IRS is instructing people to file it for Neteller but I haven't seen an offial stance from them regarding neteller.

Link plz if you have seen one.

[RoundGuy]

Thank God. A formatted post.

A $25,000 fine for not filing the fact that you had $12,206.22 in Netteller? Not gonna happen, gaboon. But, nice try.

The sky us freakin' FALLING, people!! Gaboon SAYS SO!

[Subfallen]

Sry, I'm not going to try to comprehend actual tax code documents. [img]/images/graemlins/frown.gif[/img] I only know what they e-mailed me, for a while I was worried. But I don't really think auditors will assess penalties for this without indication you were defrauding the government in other ways. Or at least some sort of malicious intent.

[Notatallagimic]

[img]/images/graemlins/heart.gif[/img]

[DING-DONG YO]

[ QUOTE ]
Sry, I'm not going to try to comprehend actual tax code documents. [img]/images/graemlins/frown.gif[/img] I only know what they e-mailed me, for a while I was worried. But I don't really think auditors will assess penalties for this without indication you were defrauding the government in other ways. Or at least some sort of malicious intent.

[/ QUOTE ]

I would agree with you there.

so, in summary, ty once again, gaboonviper