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#1
02-21-2007, 02:31 AM
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if youre audited, does the IRS look at your credit card accounts?
if a poker pro was audited for whatever reason, what are the odds that the IRS would look at their credit card accounts along with their bank statements? cause im thinking that with the ban and many people getting nervous and pulling their money out, there may be a big rush of tax-avoiders putting money into their epassporte account and withdrawing or spending the funds with the actual physical visa credit card. basically a lot of people doing the same thing that many people did with the neteller card, but am i right in assuming that theres a much higher chance of the IRS catching onto that practice since its an actual visa card? if so, i certainly wouldnt be surprised to see a bunch of posts about this pop up once the 2006 audits start rolling in.
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#2
02-21-2007, 02:45 AM
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Re: if youre audited, does the IRS look at your credit card accounts?
100%...
Not only to establish deductions, but your "lifestyle" and compare if your reported income matches your lifestyle. Tip: if your report taxable income is under $500,000, don't bring the Ferrari to the audit
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#3
02-21-2007, 04:40 AM
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Re: if youre audited, does the IRS look at your credit card accounts?
Extremely unlikely. Most audits are over specific items. It'd be very unusual for them to do a full-blown criminal investigation-type audit where they'd go to that level of detail.
Yeah, if you've never filed income tax, and you live like a multi-millionaire, and when they confront you and you still refuse to acknowledge any income, etc. They would then be forced to do a criminal investigation and then they'd go thru your finances with a fine-toothed comb.
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#5
02-21-2007, 11:31 AM
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Re: if youre audited, does the IRS look at your credit card accounts?
I doubt you make enough money or are stupid enough to fight the IRS. So, you'll be ok.
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#6
02-21-2007, 11:37 AM
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Re: if youre audited, does the IRS look at your credit card accounts?
my very humble opinion and I am no expert:
In the scenario you described, the credit card activity sounds like it would be the impetus for the audit in the first place. Credit card company sees a bunch of activty going through the account and notifies the IRS then you get audited. So, yes, they would look at your activity for that card at a minimum. As another poster said, the IRS could always expand the scope of an audit if they have reason to believe you have unreported activity somewhere else. That expanded scope could include every account (checking, savings, money market, credit card, brokerage, etc.) attached to your SSN and the SSNs of those on your tax return (wife, kids, etc.)
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#7
02-21-2007, 11:59 AM
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Re: if youre audited, does the IRS look at your credit card accounts?
well i wasnt really imagining the big ballers (people making $200k+ in a year) being stupid or gutsy enough to try that. i was thinking more about people making $50k- $100k in a year, probably kids in their late teens or early 20s. im guessing that theres not really enough "weird" withdrawls or purchases those people could make with the epassporte card card to actually trigger suspicion within the credit card company, is there? what would actually make the credit card company (in this case, epassporte) suspicious?
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#8
02-21-2007, 12:03 PM
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Re: if youre audited, does the IRS look at your credit card accounts?
epassporte isn't your issue, it's Visa and whatever US bank epassporte issues epassporte's virtual Visa.
Which brings up a good question, how is the virtual Visa structued from an issuing and settlement perspective? I can't imagine that they're issued by a US bank.
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#9
02-21-2007, 12:04 PM
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Re: if youre audited, does the IRS look at your credit card accounts?
[ QUOTE ]
Credit card company sees a bunch of activty going through the account and notifies the IRS then you get audited. [/ QUOTE ] Has this ever happened? I mean, ever?
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#10
02-21-2007, 12:07 PM
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Re: if youre audited, does the IRS look at your credit card accounts?
[ QUOTE ]
[ QUOTE ] Credit card company sees a bunch of activty going through the account and notifies the IRS then you get audited. [/ QUOTE ] Has this ever happened? I mean, ever? [/ QUOTE ] I am not an expert of course, but I would imagine it has. I'm sure someone at some point figured they could hide income by just making a ton of overpayments to a credit card and then get credit balance refunds from the credit card company. And since credit cards are issued by a bank and the banks (are supposed to) monitor suspicious activity, the bank would in theory report it to the IRS. I can't say for sure that it has ever happened, but I would be surprised if it had not.
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