Thread: Iraq/Dinar News. 09/05 to 01/14/07

Neno... thanks for the tip on how to be drawing % and extentions while we wait for the next tax due dates.. I'm keeping notes for when I visit a CPA for help.. I'm really looking forward to the investment tips we can get and share here that hopefully will help us generate more $ to cover taxes when due..

Originally Posted by danny51

Don't forget that you must make quarterly estimated tax payments for large realized capital gains or you may end up with a hefty penalty at tax time!!

check with a tax professional .. but estimated tax payments requirements are based on the PREVIOUS years tax return, so you should not have to worry about penalties based on the gain from your dinar, the first year that you exchange them.

if you hold some for subsequent years then you will need to consider estimated tax payments for sure.

All great news and good advice, but why not earn some pocket money as we wait. That is what i've been doing for the past week. I had to do something after SI. I have made $470 in the past week and am on schedule for $2000 in 30days.
Not bad for a $34.95 investment. Perhaps better than the Dinar. This involves work real work. I lost in PIPS and SI but this program below makes me money and will make me money as long as I work at it. I will keep myself busy as I wait for the peg. When it comes fine but in the meantime I am happy to be earning cash. Follow the link below and read all about it my friends
flmnco
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You can advertise in the advertise section of rolclub and put your referral links in your signature.Thanks.-neno

Originally Posted by danny51

Don't forget that you must make quarterly estimated tax payments for large realized capital gains or you may end up with a hefty penalty at tax time!!

Hey danny51 you might very well be right. But I believe this is if you own your own business and that would be the capital earned from that.

This would be my two comparisons in a flash:

Kuwait: 1 KDinar = 3.4 USD
Land Mass: 17,818 square kilometers
Population: 2.274 million
Government Type: Constitutional monarchy (stable)
GDP: $48 billion (2006 est.)
Assets: 13,300 oil reserves in million tonnes. Runs 2.0 million barrels per day (mbd) capacity is 2.5 mbd. Ships oil and refinined material.
Agriculture and livestock do not play a significant role in the economy of Kuwait as it is a very arid nation with a shortage of fresh water.
OPEC Member

Iraq: 1 IDinar = .0007 USD -Totally behind for the richest Middle East Country
Land Mass: 437,072 sq km
Population: 26,074,906
Government Type: The Iraqi Interim Government (IG) was appointed on 1 June 2004. Interim Government Constitutional Parlimentary (Federated) Democracy. (semi-stable)
GDP: In 2004, the Iraqi GDP was $25.5 billion. 2005 projections were $29.3 billion. $54.4 billion gdp (2006 est.)
Assets: Petroleum, natural gas, phosphates, sulfur, large agricultural potentia (wheat, barley, rice, vegetables, dates, cotton; cattle, sheep, poultry). 13,400 oil reserves in million tonnes. 10% of potential reserves have been explored. IMF projections 2 to 2.5 mbpd for 2005-2006.
Before U.S.-led forces defeated Saddam Hussein, whose government also heavily subsidized gas prices for consumers, average annual oil production in Iraq was 2.5 million barrels per day. Iraq has large water sources many were dammed up and drained by the dictatorship of Saddam Hussein.
OPEC Member

By Far Was - Is - And Will be the Richest Nation of the Middle East.

Originally Posted by clueless

check with a tax professional .. but estimated tax payments requirements are based on the PREVIOUS years tax return, so you should not have to worry about penalties based on the gain from your dinar, the first year that you exchange them.

if you hold some for subsequent years then you will need to consider estimated tax payments for sure.

Yes, the safe harbor is to pay at least the previous year's tax burden. With a dinar windfall, the first year will be a breeze!!

Originally Posted by Offshore-Wealth.com

Interesting,

Yes, it is amazing how many different opinions we here from these so called professionals, but in my experience, as long as you claim it as income you will be safe regardless. It is when you do not claim it that you have to worry. LOL

Capital gains are different depending on short or long term, so it is always better to exchange out at a limit per year based on what you actually need, not all of your dinar. There are many other strategies to use to limit your tax obligations, and investing your dinar directly is only one strategy which will avoid initial excessive tax liability, so slow down folks, we will all help in contributing the best strategies.

Good luck to all, Mike

But which KIND of income? Other? Regular? (They are BOTH taxed at 1/3...rediculous...)

The one accountant told me that he would have to 'do some digging to perhaps figure out a way to help save on' my taxes...so he couldn't be bothered right now.

I think that I am going to call an attorney that I know and see who he uses for an attorney...I'm sure he does WHATEVER possible to pay AS LITTLE as possible, legally.

The one CPA told me that I was "putting the cart in front of the horse" and that I should exchange the currency and wait until April 10th, 2007 to see if I get a 1099 form from the bank...I dunno about that! That is the one that said I would only be responsible for the taxes on the interest earned ONLY.

Heck! If that was the case, I would wait until mid-December to exchange..then there would only be 2 weeks left in the year to earn interest! lol!

P.S....How many years do you figure that we will have to exchange the dinar that we have? I thought the year 2010 was put out there somewhere...I could be wrong though...all the dates are blurring into one another right about now!

P.S.S...Maybe I can just use YOUR accountant, Mike! I'd be like "I've done what Mike did, so that's what I need to do for my taxes!" LOLOLOL!!! "Oh yeah...minus the oilfields and orchards and stuff...I've just done the Dinar!"
WHOOOooOOOOHooOOOOO!

Originally Posted by danny51

Yes, the safe harbor is to pay at least the previous year's tax burden. With a dinar windfall, the first year will be a breeze!!

SO! What you guys are saying is that the taxes that you pay THIS YEAR on whichever amount of dinar that you exchange, will be reflected at LAST YEARS RATE?

So for arguments sake, say my husband and I made $60,000 last year and paid taxes on THAT amount...does that mean that we would still use THE SAME tax bracket THIS YEAR? Even if we exchange 2 million dinars?

Originally Posted by tiffany

SO! What you guys are saying is that the taxes that you pay THIS YEAR on whichever amount of dinar that you exchange, will be reflected at LAST YEARS RATE?

So for arguments sake, say my husband and I made $60,000 last year and paid taxes on THAT amount...does that mean that we would still use THE SAME tax bracket THIS YEAR? Even if we exchange 2 million dinars?

Hey Tiff,

What we are discussing here is the penalty for not having enough withheld for taxes during the tax year. If you withhold an amount equal to the actual previous year's tax bill...you will not be penalized come tax time. It is called the "safe harbor" rule and comes in handy if you are expecting a much larger income in subsequent years.

Exchanging dinars will be nothing more than a CAPITAL GAIN (long or short)....PERIOD...don't let ignorant accountants get you all riled up.

danny

I just found the following post in my Word Processor...I had copied and pasted from SOMEWHERE...I don't know who posted it and can't remember WHERE it was posted....but I thought I would stick this in here...I KNEW I had some information stuck SOMEWHERE about this craziness!

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Correct U.S. Taxation on Dinar

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I have been a tax accountant for 29 years and also a financial planner. I own a substantial amount of Iraqi Dinar. Here is how it will be taxed the the IRS. This investment is not tax as regular capital gains are taxed. Foreign Currency is considered a "commodity" by the IRS and is taxed thusly: 60% is taxed at long term capital gain rates of 15%. The other 40% is taxed at ordinary income tax rates. This is all spelled out in Section 988 of the IRS Tax Code.

Combined the rates total 23%.

If you had one million Dinar and they were valued at one million dollars. You exchanged them in for the dollars and the amount you owe Uncle Sam is $230,000. You keep the $730,000 of that million dollars.

But, in order to do this, you must make an election at the time you exchange it and fill out the paperwork. Places that exchange currency know how to handle this. Go to Manchesterfx.com to see how it is explained there. If you don't make this election, then you'll be taxed at the highest current rate of 35%.

The one big advantage of this being classified as a "commodity" is that there is no specified holding period, as there is with long term capital gains. You can hold it one day, one week, one month, etc and it's still taxed at the 23%. If you exchange in a very small amount, then that tax rate would be lower, based on your ordinary tax rate.

Hope this clears up all the tax questions on our fortunes to be.

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23% is a WHOLE HECK of a lot better than 33 or 35%!

I have printed this out to take with me to the bank...Unless there is reason for this scenerio NOT to work...which I'm sure someone in here will tell ! lol! I appreciate all of your thoughts...