Taxes - Need help.

Teph · #1 07-12-2006, 01:59 PM

Hey everyone, I am a member of the "What the hell do I do, and what consequences would/should I honestly expect from tax issues club"

I won't go into a long story about how I got into the game or how its changed my life. It pays my bills, and that is all I really care/worry about. I am also starting to have a savings and I love what I do. Basically, I am a large percentage of the younger posters from SSNL/MSNL.

In my life, I have never really had to worry about anything regarding money. I was never very well off financially, instead I simply learned to deal with what I got. I would rarely spend any money and just save it. I only had one job for under a year and made an incredible 6.75/hr. renting movies to old people that complained about DVD's not fitting into VCR's. Thats when I started playing poker, when I was 17. I am by no means a multi-tabling fanatic, and I rarely even play to be honest. I do make much more than I ever could have at a bum job like that though.

This has lead me to never "getting around" to filing taxes. I have read countless posts that describe how stupid this actually is, and how much I may be lubing my self up for IRS penetration. To say the least, I have grown very concerned. I never really made a lot of money playing poker. I made a couple thousand every few months as more of a hobby, but over the last year I have gotten serious about the game moved up and made a decent amount of money. I have left nearly all of the funds (minus 3-4k) in site/neteller accounts simply because I do not know what to do.

If I were to file for the next year, would that make me more susceptible to being audited for my previous account history? What are the regulations on audits, I thought that they could go back 7 years through your paper trail, but am I wrong? What kind of fines/legal issues would I be looking at for my prior "evasion" (or lack of knowledge/responsibilty)? What measures do the semi-pro/pro regulars here that make a smallish amount do? Finally, how concerned should I honestly be?

Teph

Mods - If this needs to be moved, or you think it should be, feel free, there were many options as to which forum was most appropriate. I chose SSNL because although I play mid-stakes, I feel my yearly income is that of a SSNL player due to my lack of playing time

ChipStorm · #2 07-12-2006, 02:10 PM

Speak to a professional. This is serious stuff, go-to-jail stuff. If you thought you had a brain tumor, would you post on the web, or go to a doctor?

Find an accountant who does tax prep work, and do what he tells you to get your past filings and payments cleaned up.

MrMon · #3 07-12-2006, 02:11 PM

Consult a good tax attorney. It's just possible he could work a deal where if you agree to pay the back taxes and file properly in the future, including quarterlies, that's all you'll owe. The attorney won't rat you out, and if you can make a deal, even with minimal fines, it's better than looking over your shoulder your entire life.

MrMon · #4 07-12-2006, 02:13 PM

I think he's beyond an accountant at this point, though he'll need one to figure out what's owed. Attorney time, now!

BigBiceps · #5 07-12-2006, 02:54 PM

File your back taxes for the last 3 years, it is not too late.

You probably won't even owe anything and may even get a refund if you didn't make much (like you say).

Indiana · #6 07-12-2006, 03:39 PM

I would simply do my best to be very honest from April 15th 2007 filings and onward. You will not likely be audited so don't sweat it. It sounds like u really didn't intend to break any laws. No matter what the people on this forum say, the IRS is not out to crush you.

Indy

Wake up CALL · #7 07-12-2006, 03:44 PM

[ QUOTE ]
It sounds like u really didn't intend to break any laws. Indy

[/ QUOTE ]

I agree with the rest of your post but this part is in direct conflict with the OP's post. He certainly knew and intended to break the law but now he is afraid of the consequences.

AggieYank · #8 07-12-2006, 03:46 PM

Consider your age as well. A 21 year old who files for the first time (after 3-4 years of not filing) has to be less likely to get audited than a 45 year old who files for the first time in 3-4 years.

Indiana · #9 07-12-2006, 03:46 PM

[ QUOTE ]
[ QUOTE ]
It sounds like u really didn't intend to break any laws. Indy

[/ QUOTE ]

I agree with the rest of your post but this part is in direct conflict with the OP's post. He certainly knew and intended to break the law but now he is afraid of the consequences.

[/ QUOTE ]

Well if he did intend to break laws I don't think he understood the severity of it. Anyway I am so sick of people saying that you will go to jail with 100% certainty if u didn't claim $5300 in poker income from 2002 or whatever. The IRS isn't sending anybody to jail for that b.s. and I know because I've "evaded" taxes and been caught.

Indy

cowboy.up · #10 07-12-2006, 03:48 PM

While an audit generally reaches back a few years you are technically always able to be prosecuted for omitting funds from your tax return ("unclaimed income" even if it was 50 years ago).

Indy is right though, the IRS likes to beat on its wardrums from time-to-time but they don't want to crush the average American taxpayer. If you don't have the cash to consult a tax professional just do your best and be as honest as you can (even though "doing your best" isn't really advized by the IRS - you'll feel better inside [img]/images/graemlins/grin.gif[/img])