Thread: "Taxes", Anything Related To It In Here

O.k. friends...

I, personally am a bit irked at the mo...but I just got off of the phone with my tax woman, who has offices throughout the US...EG Tax...her name is Esther and she is the owner and has done my taxes for 15 years.

I explained that I had acquired foreign currency and may have the opportunity to trade it in for USD soon and wanted her advice on how to go about it for tax purposes.

She said flat out that it was not a Capital Gain that it would be a REGULAR income tax at 33% !!!!!

I asked her like 5 times...are you sure??? Are you positive??? She said that she wished the answer was different. She told me that if I traded in $4mil, I would have to pay $1mil in taxes!!! Talk about a kick in the gut!!!


My smile ain't so big right now...what are we to do here in the US?
Tiff

Originally Posted by tiffany

O.k. friends...

I, personally am a bit irked at the mo...but I just got off of the phone with my tax woman, who has offices throughout the US...EG Tax...her name is Esther and she is the owner and has done my taxes for 15 years.

I explained that I had acquired foreign currency and may have the opportunity to trade it in for USD soon and wanted her advice on how to go about it for tax purposes.

She said flat out that it was not a Capital Gain that it would be a REGULAR income tax at 33% !!!!!

I asked her like 5 times...are you sure??? Are you positive??? She said that she wished the answer was different. She told me that if I traded in $4mil, I would have to pay $1mil in taxes!!! Talk about a kick in the gut!!!


My smile ain't so big right now...what are we to do here in the US?
Tiff

You need to get another opinion...my very experienced ex-IRS employee accountant says Capital Gain all the way!!! WOOHOO!!

I guess I'm going to have to call around...This woman just really seems to know her stuff...upsetting to me...been with her so long! :-(

IF it's not a Capital Gain, then it would more than likely fall under normal income. As such, the tax rate would be based on the "sliding" scale that you use when calculating your taxes each year. This would mean, if you cash in less per year (say 100,000 in a year) then your tax rate would be calculated on that 100,000 as income which would be less than 33% depending on your number of dependents and other deductions. However, this is all subjective being that you didn't say "what" she said it would have to be claimed "as"....

Yes EW, she said that it would fall under normal income.

She also said that if she were me she would exchange all of it at once because "a bird in the hand..." (some little saying she said) and wouldn't I be happy to know that I would DEFINITELY have the cash in hand rather than take the CHANCE of the currency 'bottoming out' again.

It was ONLY HER OPINION about turning it ALL in right away...I personally won't do that...silly to do that seeing as though Kuwait's $$ is over $3 to the USD right now...just need enough for a house big enough to fit me and my 4 boys. (hubby incl!)

I need to make a few phone calls I guess...That really would s*ck pretty bad if it is 1/3! Really not fair at all....

Maybe we can get a thread started on how to "shelter" some of this money and therefore spread out the tax burden over time. There may not be a simple way but surely we've got enough professionals in this forum to make a decent run of it. Just a thought...

Everwiser

All right! I'm breathing a bit better now. I just spoke with my dealer, who is registered with the US Treasury for almost an HOUR!

He said that my tax lady is probably a very GOOD tax lady, but she mustn't be an accountant "that specializes in investment taxes". I need to find myself one of those...

He also said that it WOULD IN FACT be considered a capital gain tax with minimal taxes being charged.

He also went through the whole form 8300 and how it's a legal loophole to exchange $9999 or less and that you're not noticed this way by the IRS.

He also said that "the only reason someone would be afraid to exchange amounts greater than $10k is if they have done something wrong and should have REASON to fear a phone call from the IRS" (or not wanting to be taxed, but it is minimal, he said) He mentioned drug dealing and money laundering...and how EVEN IF you go to a car dealership and pay $30k cash for a vehicle, THAT dealership fills out a 8300 form! He said that many unknowing drug dealers get caught by simply buying a car with cash!

Also...if you sell your car for $15k and deposit the money in your bank account, a form 8300 gets filled out by the bank! I had NO IDEA!!

He also said that there are MILLIONS of people in the United States that have purchased Dinar, and that they will be expecting an influx of dinars being exchanged. He said in that aspect it is different than the Kuwait currency after the Gulf War, because there are SO MANY of us that have it in our possession!

He told me that if I was to exchange $1mil at a bank and deposit it and I received a phone call from the IRS asking where I got it from, all I would have to do is tell them that I purchased it online on ebay and that I have the invoice from the purchase which shows how much I purchased it for. He said that they MAY ask for a copy of the ebay receipt, but BIG DEAL because it's legitimate and I've done nothing wrong!

I am so much happier now....He is just one more source that verifies what is said here in 'our' forum! ( He also kept referring to the exchange as "If you exchange a $10k note and receive $10k..." so he was inadvertantly speaking as though it will be valued dollar for dollar also without me even mentioning it!)

Sorry if I was panic mode guys...please forgive me!

Any further thoughts are appreciated!!
Tiff

Originally Posted by tiffany

All right! I'm breathing a bit better now. I just spoke with my dealer, who is registered with the US Treasury for almost an HOUR!

He said that my tax lady is probably a very GOOD tax lady, but she mustn't be an accountant "that specializes in investment taxes". I need to find myself one of those...

He also said that it WOULD IN FACT be considered a capital gain tax with minimal taxes being charged.

He also went through the whole form 8300 and how it's a legal loophole to exchange $9999 or less and that you're not noticed this way by the IRS.

He also said that "the only reason someone would be afraid to exchange amounts greater than $10k is if they have done something wrong and should have REASON to fear a phone call from the IRS" (or not wanting to be taxed, but it is minimal, he said) He mentioned drug dealing and money laundering...and how EVEN IF you go to a car dealership and pay $30k cash for a vehicle, THAT dealership fills out a 8300 form! He said that many unknowing drug dealers get caught by simply buying a car with cash!

Also...if you sell your car for $15k and deposit the money in your bank account, a form 8300 gets filled out by the bank! I had NO IDEA!!

He also said that there are MILLIONS of people in the United States that have purchased Dinar, and that they will be expecting an influx of dinars being exchanged. He said in that aspect it is different than the Kuwait currency after the Gulf War, because there are SO MANY of us that have it in our possession!

He told me that if I was to exchange $1mil at a bank and deposit it and I received a phone call from the IRS asking where I got it from, all I would have to do is tell them that I purchased it online on ebay and that I have the invoice from the purchase which shows how much I purchased it for. He said that they MAY ask for a copy of the ebay receipt, but BIG DEAL because it's legitimate and I've done nothing wrong!

I am so much happier now....He is just one more source that verifies what is said here in 'our' forum! ( He also kept referring to the exchange as "If you exchange a $10k note and receive $10k..." so he was inadvertantly speaking as though it will be valued dollar for dollar also without me even mentioning it!)

Sorry if I was panic mode guys...please forgive me!

Any further thoughts are appreciated!!
Tiff

Funny,

Nice problems to have, right Tiff, taxes. (g) For so long we have been dealing with write offs for our losses in PIPS, not finally we can all start to talk about tax shelters. By the way, captital gains are based on how long you held onto dinars as well, over a year is different rate than under year.

Good luck to all, Mike

Hi Mike!

More or less? I mean, I have had mine for less than a year.....would my tax percentage be higher than someone that has had them for longer? PLUS I didn't claim anything on last years tax forms that I had purchased any...like a loss(?)

Learning a bunch about these things as we go along!

Tiff

Originally Posted by tiffany

Hi Mike!

More or less? I mean, I have had mine for less than a year.....would my tax percentage be higher than someone that has had them for longer? PLUS I didn't claim anything on last years tax forms that I had purchased any...like a loss(?)

Learning a bunch about these things as we go along!

Tiff

Hi Tiff,

Yes, it is a complicated system as we know, so with everyone in a unique situation, based on accumulating dinar a little at a time, different incomes, different needs, etc. I have some dinar that I have had for two years plus, so I will exchange those first, if I remember which ones they were. LOL

The one year rule is to encourage long term investments, so a penalty is levied for investments that are less than a year old, so the easiest way to calculate your taxes is to use this capital gains calculator. Have fun, after all, paying taxes is fun, right? LOL

Good luck to all, Mike
http://www.moneychimp.com/features/capgain.htm