If you had more then $10k in neteller in 2006 but didn't pay taxes!!

[G-Diddy20]

depokerstar, do u have any idea how much the fact that the DOJ has our neteller records increases the chances of an individual audit? For example, my parents accountant told me in his honest opinion before this whole neteller thing happened that there was likely a 1% or less chance of me being audited based on what i told him, same stuff i put in the OP. anyone have a guess as to what they think it is now?

G

[depokerstar]

[ QUOTE ]
depokerstar, do u have any idea how much the fact that the DOJ has our neteller records increases the chances of an individual audit? For example, my parents accountant told me in his honest opinion before this whole neteller thing happened that there was likely a 1% or less chance of me being audited based on what i told him, same stuff i put in the OP. anyone have a guess as to what they think it is now?

G

[/ QUOTE ]

I have no idea and wouldn't make a % guess. I can just say that in my case, it's not worth it. You being a college student with less assets, income, etc might feel differently.

And I agree with your family's accountant. But maybe the DOJ or other agencies think that as well. I'd guess there's almost an endless supply of non-filers, whether it be state or local, regarding gambling taxes.

[joker122]

"It seems that in the past people on here have exaggerrated things when it comes to taxes from what other people tell me but I am a complete tax noob so I don't know.
"

absolutely. people are idiots.

but i don't understand how or why you would neglect to pay taxes on '06 winnings when we knew Neteller turned over all records to the DOJ BEFORE april...

also, the notion that you would goto jail because you didn't pay tax on 22k of income is laughable. the IRS is in the business of getting money from people, not locking people up. if you're in jail, you can't pay, and all they want is to be paid.

and you would be right about not filing being the +ev play however the whole DOJ thing made it decidedly -ev imo.

[joker122]

nm

[TheEngineer]

I don't know the odds of getting audited, but making numerous posts on a public board about not paying can't reduce the odds.

[Legislurker]

You're right to look at it in terms of EV. Basically, you get
one [censored] up with the IRS if you contact them beforehand. Get a tax ATTORNEY, file late, and pay. You can choose an offer/compromise route if its beyond your ability to pay, but that sort of screws up using it later. If this is bothering you, pay an attorney for a consultation, and do what he says, and get something in writing from the IRS. Its going to cost you though.

[godofgamblers]

I have a lot of transactions in 2006, but overall it was not a fun year. Only ended up 6-7k. Didn't bother reporting it since I get all my income tax back anyway, but I'll definitely report 2007 since I'm well over 25k since. Would it be smart to file amended for the 6-7k (whored a LOT in the beginning of the year (i.e. a billion $50-200 deposits and $50-$300 withdrawals) so it'll be a huge hassle of actually reporting for how much I actually earned). The basic attitude for this was <10k = no need to worry, but since I'm reporting this year (2007) and they have access to my Neteller records since before then, would it be the prudent thing to do now?

[G-Diddy20]

[ QUOTE ]
"It seems that in the past people on here have exaggerrated things when it comes to taxes from what other people tell me but I am a complete tax noob so I don't know.
"

absolutely. people are idiots.

but i don't understand how or why you would neglect to pay taxes on '06 winnings when we knew Neteller turned over all records to the DOJ BEFORE april...

also, the notion that you would goto jail because you didn't pay tax on 22k of income is laughable. the IRS is in the business of getting money from people, not locking people up. if you're in jail, you can't pay, and all they want is to be paid.

and you would be right about not filing being the +ev play however the whole DOJ thing made it decidedly -ev imo.

[/ QUOTE ]

really? it increased the chance of an audit that much to make it -EV? i certainly believe you, just mad at myself for not seeing this coming. I didn't know that they were getting turned in til after the april tax deadline, my fault for not staying on the ball. So, in your guys opinions, would it be smart to just pay taxes on the $12k and change that I had in neteller, or would you guys pay for it all $22k?

The only reason I even mentioned jail was because the links people were giving in the threads in this forum said that not filing the FBAR would likely lead to jail time.

Also, I would like to hear the most likely worst case scenario of what could happen if I didn't do anything at all. Would it be like a small monetary fine for not filing or what?

Please understand that I am just trying to avoid a situation where I am paying taxes on the $22k for whatever it would be, $2800, but the penalty would only be slightly more money and the chance of getting caught was less than >5%. I appreciate again all your guys help and please understand where I am coming from.

Your advice so far has been very helpful...

G

[Rabid_Hippo]

The posters saying that you won't go to jail for tax fraud/tax evasion are dead wrong. You should file your taxes and claim every penny you earn (and take all appropriate deductions).

By the way, in the event you are investigated for tax fraud/tax evasion, the posts you put on this website are admissible against you as evidence of intent to commit fraud. The IRS does not have a sense of humor regarding these things.

The taxes, interest and penalties are what they are, and you are obligated to pay them. That is the only "advice" you need.

[1meandog4u]

[ QUOTE ]
And btw, opinions are welcome, if you don't know for a fact thats ok, I welcome peoples opinons who are smarter and more experienced than I [img]/images/graemlins/smile.gif[/img]

G

[/ QUOTE ]

I concur with one of the previous posters. I "doubt" you would be penalized much, if any, on the foreign bank issue. Ignorance might be a sincere approach on that one, especially given your age.

On the tax issue, forgetting the morality issue, you are now in the best position possible to file late, pay the taxes and/or penalties. Get ALL the legitimate deductions. Definitely find a good tax accountant preferably with gambling experience.

Remember since you are a college student, if this was your only basic income to report, the taxes owed, and penalties will be a lot less than most.

Do you really want to spend three years, seven in the case of fraud, sleepless worrying about an audit? Since you appear to be a decent winning player, I assume you will play in the future. Want a past issue like 2006 to haunt you for years? And if you are EVER audited, think of the consequences of them digging back into passed year taxes.

Not worth the "gamble" to pardon a pun. If that is your income, less than $25k for the year, with deductions, you could reduce that severely.. Remember all those trips to Vegas? Ever lose any money there? Document it with dates, and if you ever used a player's card to play games, they will give you a print out for last year, of the activity. You might be surprized how much you can deduct with a good accountant.

Good luck. It's not a matter of doing the "right thing", it's a matter of doing the smart thing.