Taxes on offshore winnings

[Bombs]

Just wondering if anyone knows anything about paying taxes on offshore winnings. I use Neteller EFT to get the money to my bank account but recently have had a large offshore windfall (5 figures) that I would like to withdraw.

What is Big Brother's monitoring of transfers to my bank account from places like Neteller? Is there a better way to transfer the money? Should I just bite the bullet and pay taxes somehow?

Thanks for any responses.

 

[Wilson]

Surely, you have some losing tickets to offset the taxable winnings? If not, I am coattailing you from now on

 

[Trossi3389]

 

[Bombs]

I had basically a year off and dedicated a ton of time to this crap, and made some serious coin, especially in the last month off the Pistons. I just don't know what to do with this. Of course, I do have losses, but they are from the past, and for this calendar year especially I am up a mild boatload. Not sure what to do here or if anyone has been in a similar situation.

 

[Trossi3389]

why dont u just have your book fed ex chunks at a time by checks? i believe anything under 5500 they cant touch..

 

[Terryray]

With the implementation of the April 1996 amendments to the Bank Secrecy Act Regulations, banks must submit a Currency Transaction Report (CTR) if money being brought in is over a certain amout. I believe your transaction falls below the cutoff. But Suspicious Activity Reports (SAR) might be filed since transaction came off an offshore and thur neteller.

 

[Turfgrass]

Topic 419 - Gambling Income and Expenses

Gambling winnings are fully taxable and must be reported on your tax return. You must file Form 1040 (PDF) and include all of your winnings on line 21. Gambling income includes, but is not limited to, winnings from lotteries, raffles, horse races, and casinos. It includes cash winnings and also the fair market value of prizes such as cars and trips. For additional information, refer to Publication 525, Taxable and Nontaxable Income.

If you receive $600 or more in gambling winnings, the payer generally is required to issue you a Form W-2G (PDF). If you have won more than $5,000, the payer generally is required to withhold 25% of the proceeds for Federal Income Tax. If you did not provide your social security number the payer may have to withhold 28%. For more information on withholding, refer to Publication 505, Tax Withholding and Estimated Tax.

You can deduct gambling losses only if you itemize deductions. Claim your gambling losses as a miscellaneous deduction on Schedule A Form 1040, line 27. However, the amount of losses you deduct cannot be more than the amount of gambling income you have reported on your return. It is important to keep an accurate diary or similar record of your gambling winnings and losses. To deduct your losses, you must be able to provide receipts, tickets, statements or other records that show the amount of both your winnings and losses. Refer to Publication 529, Miscellaneous Deductions, for more information.

 

[Trossi3389]

:look:

 

[ctownguy]

Bravo Turfgrass:Yep: :clap:

 

[Terryray]

so....

so....

the IRS may or may not have a report sent to them of this large amount of money you are transferring from. Cutoff for a CTR is $10,000....http://www.sia.com/moneyLaundering/html/background.html


any suspicious activity can generate a SAR. Most common is to "smurf" amounts just under the cutoff. Rush Limbaugh got caught doing this very thing..........http://talkleft.com/new_archives/004391.html


However, there is a banking record of it the IRS would be sure find in an audit down the road, should you suffer one. Then you'd need a new mortgage (I'm exagerating just a little!) to pay off the tax bill (incl penalties and interest) from this five figure amount you transferred if you failed to pay the tax now (as per instructions Turf refers to).


You can transfer it cash Western Union. This is expensive, but no long term record of it is kept or provable to you that the IRS can access, and is not reported to the IRS if under $1000.


Naturally, this loophole steams them to no end and efforts have been made to get the threshold lowered to $250 and $500. The last bill to do this died as Congress/Clinton caved into squealing from hispanic community activists and lobbyists.

 

[Bombs]

Thanks for all the input guys. Yet another possiblity might be using my Neteller debit card to withdraw the money in smaller increments, like 500 a pop, from cash machines. Only problem is I am stuck with a bunch of cash to put in the bank, not sure which is worse.

 

[Penguinfan]

Just curious

Just curious

Why not just claim it on your taxes and pay the tax due? As a horse player I run in to this and when you cash a big ticket they fill out all the necessary paperwork so you have to claim it on your taxes and if it's a big score like your talking about then they tax the ticket right then and there and you get a tax refund on that just like any other income since they tax it at the max and unless your in the top tax bracket then you are due a refund.

Just pay the tax and sleep easy.

JMO
Penguinfan

 

[Marco]

Regarding what Turfgrass wrote about "the amount of losses you deduct cannot be more than the amount of gambling income you have reported on your return"........

This is complete bull$hit......I'm supposed to accept a situation where I pay taxes on winning years and in years that I lose I'm just $hit outta luck.....this is supposed to be fair???

If I ever ran into a situation where my gambling winnings were taxed before leaving a casino you can be damn sure I'm going to balance that winner out with some concocted losses.....even if I had to go to the track and pick up tickets off the floor or grab a bagful of spent pickle cards someone else opened......

The government forces us to go underground or offshore, then has the gall to want tax money on an activity that should be one of our personal freedoms, that they spend so much time trying to outlaw??? Call that reason number two.

Reason number three: The tax money sent in to the government just gets wasted in some bureaucracy, or spent fighting other country's wars and rebuilding thier country while ours falls to pieces.......The less money they have, the less money they have to waste, and the more money you keep, the more money subsequently gets spent in our own economy, on our own people and products.....

Please do yourself and everyone else a favor......bring it in slow and inconspicuously, pay little or no taxes on it at all, and be happier knowing that it's all going to a better place in the long run if the government gets less of it....

 

[maverick2112]

And Last but not Least................THANK GOD FOR THE PISTONS

 

[GM]

Have them send the money to me and I'll get it to you somehow. Gambling winnings, contests, lotteries and the like are not taxable in Canada. (That's about the only thing that isn't taxed in Canada). I won $15,000 US in a couple of NFL handicapping contests in 2002...didn't have to pay anything on it. Also won a Harley Davidson Fat Boy this year and didn't have to pay taxes on that.

So I guess the answer is....move to Canada.

 

[Penguinfan]

Marco

You seem to grasp the situation, but just don't like it. You pay taxes on all earning in the US, sorry but that is part of the deal for living here. You don't have to like where they spend the money, for that matter why don't you stop paying taxes on your paycheck, or make up some fake deduction, I mean that money gets spent the same way as gambling taxes. If the IRS finds out, your gonna pay big time. As far as paying on winnings, but not deducting if you lose, well you can't deduct alot of things you spend money on now can you?
Pay the taxes and suck it up like the rest of the country.

Penguinfan

 

[Marco]

penguinfan.....Yes I grasp the situation and yes, I don't like it......

When the governments approach to taxation and the spending of said collected taxes approaches anything that resembles being fair.....only then will I change my attitude about the governments obvious abuses....

Not to turn this into a political arguement, but when did we as American citizens get a chance to vote on the ruling party's pension plan that compensates them to the tune of a full salary upon retirement, while the working class that pays into social security for decades will receive a few hundred a month from a plan that is due to be extinct from that same ruling classes abuse? They receive full salary upon retirement drawn from the general fund while the rest of us get a few peanuts........highly discriminatory fact that we as taxpayers have to just accept?.....No, put these fvckers on social security like the rest of us, then see how fast social security is fixed......What's good for the average citizen in this case is good for the ruling body also...

When did we as American citizens get to vote on all the billions upon billions of dollars that gets sent over to Israel and these other small countries that need financial bandaids? No, it's not anti-semitic, because I'm in favor of banning these transactions regardless of what country it's going to, and I honestly doubt if the American public was allowed the chance to vote on that issue, that that money would stay here in the U.S....In fact I'd almost guarantee it.

Not to mention all the wars we have fought that had little or nothing to do with the self defense of our nation, the biggest being Vietnam and Korea......the cost of these wars? Billions of dollars and over 100,000 dead......fighting someone else's civil wars......tell me how many Vietnamese and Koreans died in our civil war at Gettysburg or Bull Run, and where in Vietnam or Korea is thier monument to the stupidity and waste of thier government, having fought in some other country's civil war???

People have a tendency to do what they think is fair in most life situations......when the government shows it can manage a budget and be responsible with expenditures.....then maybe I can justify giving them extra tax dollars because then I will know that it is going to a rightful place and taking care of the same people that pay these taxes.....NOT GOING TO REBUILD SOME FOREIGN $HITHOLE COUNTRY WHILE OURS IS CRUMBLING AND BUILDING A MULTI-TRILLION DOLLAR NATIONAL DEBT......

When you say "Pay the taxes and suck it up like the rest of the country"...........I'm not going to take it up the ass along with the rest of the country........I'm not some mindless sheep like some of the other people living in this so-called democracy where people have the illusion that they control the government by this act called "voting"........Like I say, if people could actually vote on any of these issues I have brought up, the outcomes would have been completely different....

Somebody else can take it up the ass and like it. Period.

 

[Penguinfan]

Marco, your right and your right, but your still going to jail if you don't pay the IRS what you owe them and get caught, that is what this thread is about. I don't like my paycheck taxes going to rediculous causes any more than you do, Bombs asked for advice and I gave him very sound advice, obey the law, I didn't say he had to like it, but it beats the slammer. If you think the IRS is fooling around, you better think again. We agree on the points you made, but that doesn't change the facts.

Good Luck

 

[Marco]

If the IRS is really interested then bring it on, I've had winning years and losing years, if they can prove any of it then they're gods because I haven't kept track of any of it and consequently they won't be able to either......

If they were serious about collecting taxes they'd concentrate on all the offshore tax havens and scams that corporate America uses to save paying BILLIONS of dollars of taxes...(personally, I'm in favor of a consumtion tax that would eliminate the need for tax shelters altogether but that is another topic)....

So, if the government wants to waste more tax money sending the IRS to pursue a small fish like me, it wouldn't surprise me....they have already shown a clear and excessive propensity for waste, why stop now????

penguinfan.....your advice may be sound and yes it would avoid him facing possible legal problems....I was just presenting an option that took into account the history of government hypocrisy concerning tax issues and the need to base one's decision on that clear and abusive reality....

 

[Penguinfan]

Again we agree, it's just that in this day and age a large chunk of money coming in from out of the country may raise the red flag, now is 10 grand large enough, I have no idea, I am in the better safe than sorry camp, and don't forget I have no choice when cashing a horse ticket, they just take the govt's money right there, or fill out a 1099 form so either way i am paying up.