If you had more then $10k in neteller in 2006 but didn't pay taxes!! - Page 3

emptyshell · #21 07-04-2007, 06:19 AM

It's very unlikely you will get audited or ever have to pay if you don't speak up. For me, though, it was worth paying anyway to avoid having to worry about it. As you get older, you realize that the lack of worries and concerns is actually worth quite a bit of money.

Although the small dollar amounts you mention make it very unlikely you'll have to think about jail time, you definitely would have to think about it if you did similar things in the future with larger sums. Conscious negligence is much less likely to be forgived then a simple mistake.

PokeReader · #22 07-04-2007, 06:58 AM

Please read the long thread on FBAR's. FBAR penalties can be worse than tax evasion. There is no non-fine for failure to properly file FBAR, if you meet 4-part test will still be fined 5-10% of account max. If a FBAR filer used his account to evade taxes, you cannot qualify for unwilling FBAR status, and hit the 50% of account max or 100K whichever is more. Furthermore, no one is sure, as there is no available FBAR extension that FBAR penalties will not accure to late filers. Hopeful unlikely, but IRS has not given guidance on this.

You need to contact a tax attorney, not a CPA. A tax attorney is allowed to advise you if you are better off if you file late...., or some other way. Be sure that you are aware you can only net if you are filing as a professional gambler. Otherwise you must file on winnings only. Seek professional advice people. Especially if you did something you shouldn't have. Max. penalty for FBAR: 10 years and/or $500,000. Don't be surprised if they use this to punish some big fish who should have been smarter to further frighten off the fish from internet gambling. Also, I don't know if they will pursue it, but there are FBAR implications for peer-to-peer transfers. Read the thread.

G-Diddy20 · #23 07-04-2007, 01:20 PM

how much on average would it be to speak with a tax attorney?

1meandog4u · #24 07-04-2007, 05:01 PM

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how much on average would it be to speak with a tax attorney?

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I am not saying it will do you any good, but this link might work for you to email the gentleman.

http://www.gamblingandthelaw.com/

This is the site of Nelson Rose, argueably one of the leading attorneys on tax/gambling related issues. Just keep the emotion out of the email and state the facts, he may reply and give you suggestions. He is in So. California FWIW.

drtofu66 · #25 07-04-2007, 06:17 PM

Nothing specific to your situation, but it explains the whole FBAR and tax thing a little more

http://www.thepokerchronicles.com/archives/000902.html

jrbick · #26 07-04-2007, 11:36 PM

I haven't read all responses, but I'm gonna go out on a limb here and say that I don't think you could go wrong by just filing everything ASAP.

- hire tax attorney who will probably advise you to:
- file your taxes, send payment
- file the foreign account thingy even though it's late.
- suck up w/e penalties you incur.

At best you eat penalties and still come out w/ 2-4k left over. At worst, well, at least you showed some sort of "good faith effort" even if it was kind of late. Might at least keep you out of jail.

For the future, it's best not to frig around w/ this stuff.

Legislurker · #27 07-05-2007, 12:12 AM

I paid $120 for a consultation. Could vary state to state as lawyers are pretty socialist about rates being set by state bars, or if he is a full time settle tax debt attorney he may even be free for consulting(depending on your debt or expected debt level). I think the number we came up EV wise was 50k in assets to do an offer/compromise at, but this was 3 years ago. My sense is with the other people recommending you moving first, lesson learned, jail avoided. The chances may not be large, but jail is like being broke in a tourney, except its life.

G-Diddy20 · #28 07-05-2007, 12:18 AM

u really think that all i will have left over from 22k is 2k after paying taxes late, filing that form late, and penalties. i really hope that is not the case!!!

anyway, i am going to talk to my family's accountant tomorrow and am planning on printing out all my records for neteller for 2006. I actually had $14,150 in there at the most, and that was in October. I also plan on asking him about the FBAR form and probably filling it out late. Does anyone have any idea how much they think I will pay after all is said and done with that amount ($14,150) being reported, penalties and all? I'm assuming I would be in the lowst bracket, 15%. I ballparked it around $2300. What's everyone think?

1meandog4u · #29 07-05-2007, 04:26 AM

[ QUOTE ]
u really think that all i will have left over from 22k is 2k after paying taxes late, filing that form late, and penalties. i really hope that is not the case!!!

anyway, i am going to talk to my family's accountant tomorrow and am planning on printing out all my records for neteller for 2006. I actually had $14,150 in there at the most, and that was in October. I also plan on asking him about the FBAR form and probably filling it out late. Does anyone have any idea how much they think I will pay after all is said and done with that amount ($14,150) being reported, penalties and all? I'm assuming I would be in the lowst bracket, 15%. I ballparked it around $2300. What's everyone think?

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That's probably a fair estimate but....

It seems you're still trying to base this on your balances, not your activity/actual profit. IF you get audited, more apt to happen with a late/penalized filing, and they open up your records, or demand them... you're in a heap of trouble. Filing late, then deliberately falsifying your income. Like we've all said, "Suck it up" and declare what you feel is an approximate income, even if you estimate slightly on the low side. See your tax accountant. Pay what you owe and get this damn thing behind you.

You are trying to nickel and dime the IRS. If you are going to file, then do it right, or don't declare anything and take your chances... I do NOT advise that. But, partially doing the right thing... is like almost being pregnant. You are, or you aren't...

I'm one of them "old farts". I far from know everything. However, been audited. Not fun, but I was cleared and could verify everything being questioned. You're young, and have your whole life in front of you. If you build your life on a sand foundation, nothing good can come of it.

Good luck whatever you decide.

swarm · #30 07-05-2007, 10:30 AM

G-Diddy,

I have a friend in an almost identical situation except that he also has a job so his income level is a little higher. He did file is FBAR on time though.

I referred him to my tax attorney and this is what he found out.On about 20k of net income (35k wins 15k losses) his responsible tax was around 4-5k within his 20% tax bracket.

The interest is 6% on the three months his filling an ammended return with late income (A couple hundred bucks). His penalty was around $150.

He also had to pay some additional to the state but I don't know what that is. Probably around 1k i guess.

Attorney fees were a couple hundred bucks. All in all it won't cost you that much more versus had you filed in April.

Just get it done, you have the funds.