Declaring your Neteller account (for US citz w/ balances over $10k)

[SBR_John]

For those US citizens that file a TDF 90-22.1 to declare offshore bank accounts, here is what I found out today.

In a well known tax attorney's opinion you should declare your Neteller account if the balance ever reached $10,000 in 2005 and before. If it reached that in 2006 you have until June 30th to file the 90-22.1.

If you did not think you needed to report it like yours truely, then simply download the form from the ole irs.gov site, fill it in and write "AMENDED" at the top and mail it to The Dept of the Treasury in Detroit.

I would highly recommend this be done if you are required to. It is likely that the IRS now has or will soon have all the records of your account. The penalty for not filing this form are severe, up to a $500,000 fine.

[Justin7]

John -

Is Neteller considered an "offshore bank account"? I didn't think it met the specs of an official bank.

[DrunkenLullaby]

If they're a bank, then a whole bunch of us should be getting our FDIC insurance payments soon, right?

They didn't pay interest. They didn't provide security for deposits (as it turns out). I'm dying to know what allows this attorney to interpret them as a bank. If I put $10K in my mattress, do I have to declare the Sealy Posturepedic Bank on my return? Where is the fundamental difference between my mattress and Neteller?

[Scooter]

Can you link to the well known tax attorney's opinion?

[durito]

So, it only has to have reached 10,000 at one point? What if it was only for a day?

[jjgold]

Neteller is not even close to an offshore bank account, dont report shit. An offshore bank account requires tons of personal info and Neteller never asked for that.

[Sean]

From the filing instructions on form TD F 90-22.1 :

Who Must File this Report
Each United States person, who has a financial interest in or signature authority, or other authority over any financial accounts, including bank, securities, or other types of financial accounts in a foreign country, if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year, must report that relationship each calendar year by filing TD F 90-22.1 with the Department of the Treasury on or before June 30, of the succeeding year.

General Definitions: Financial Account
Generally includes any bank, securities, securities derivatives or other financial instruments accounts. Such accounts generally also encompass any accounts in which the assets are held in a commingled fund, and the account owner holds an equity interest in the fund. The term also means any savings, demand, checking, deposit, time deposit, or any other account maintained with a financial institution or other person engaged in the business of a financial institution.

Sounds to me like a "financial account" is defined loosely enough that Neteller could be interpreted as such.

[SBR_John]

Like I mentioned, the Feds are going to have this info soon via Neteller. Its going to be like shooting fish in a barrel for the IRS for those who didnt file this. Better safe than sorry imo.

Its a simple information report.

[RickySteve]

Paranoia is bad for your circulation.

[Scooter]

SBR_John - I'd like to read the opinion of the well known tax attorney.

If you can't provide a link, what about reproducing the article, or providing some further specifics to guide those of us who are interested in researching this man's opinion further.

[SBR_John]

SBR_John - I'd like to read the opinion of the well known tax attorney.

If you can't provide a link, what about reproducing the article, or providing some further specifics to guide those of us who are interested in researching this man's opinion further.

OK, I will see if I can get him to come on here. There is no link. I called two tax attorneys and both said it was required.

Btw, there is no reason to be paranoid as Ricky put it. This is a simple form. Takes all of 2 min to fill out and that includes a break or two.

[spliff]

thanks for the info John.

[DrunkenLullaby]

From the filing instructions on form TD F 90-22.1 :

Who Must File this Report
Each United States person, who has a financial interest in or signature authority, or other authority over any financial accounts, including bank, securities, or other types of financial accounts in a foreign country, if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year, must report that relationship each calendar year by filing TD F 90-22.1 with the Department of the Treasury on or before June 30, of the succeeding year.

General Definitions: Financial Account
Generally includes any bank, securities, securities derivatives or other financial instruments accounts. Such accounts generally also encompass any accounts in which the assets are held in a commingled fund, and the account owner holds an equity interest in the fund. The term also means any savings, demand, checking, deposit, time deposit, or any other account maintained with a financial institution or other person engaged in the business of a financial institution.

Sounds to me like a "financial account" is defined loosely enough that Neteller could be interpreted as such.

If true, it makes you wonder why no gamblers ever heard from Uncle Hulka when Paypal folded up into a fetal position and played nice for the Feds several years ago. Is it that they (the IRS) decided they didn't want to collect a bunch of $500,000 fines?

[Scooter]

Just read a post on another website, where a poster said a tax attorney unofficially told him he didn't believe that the IRS would consider Neteller a bank.

So I'd certainly like to learn more about the contrary opinion.


SBR_John - "Btw, there is no reason to be paranoid as Ricky put it. This is a simple form. Takes all of 2 min to fill out and that includes a break or two."

It may only take 2 minutes to fill out the form, but the ramifications will potentially be many and serious.
And it's possible that the IRS will never receive the specifics of all accounts that Neteller ever held, and/or that the IRS will not consider Neteller a bank.

Meanwhile, filling out the form will open up a can of unpleasant worms.

[pico]

agree

Just read a post on another website, where a poster said a tax attorney unofficially told him he didn't believe that the IRS would consider Neteller a bank.

So I'd certainly like to learn more about the contrary opinion.


SBR_John - "Btw, there is no reason to be paranoid as Ricky put it. This is a simple form. Takes all of 2 min to fill out and that includes a break or two."

It may only take 2 minutes to fill out the form, but the ramifications will potentially be many and serious.
And it's possible that the IRS will never receive the specifics of all accounts that Neteller ever held, and/or that the IRS will not consider Neteller a bank.

Meanwhile, filling out the form will open up a can of unpleasant worms.

filling out the form is stating, "hey, irs, i have a lot of money offshore, please tax me" the irs might even look closer to your financial situations...if teh US gov got interested in your financial dealing, then you'll be in serious trouble. it is not that hard for them to find out all your account activities and your bank wire to online sportsbooks.

i'd say, it seems like you're asking for trouble. but i'd like to know if anyone has fillout the forms for tax year 2005 or 2004.

[SBR_John]

If true, it makes you wonder why no gamblers ever heard from Uncle Hulka when Paypal folded up into a fetal position and played nice for the Feds several years ago. Is it that they (the IRS) decided they didn't want to collect a bunch of $500,000 fines?

Paypal was always based staeside so no need to declare it. Only accounts based outside of the US have to be declared.

[SBR_John]

filling out the form is stating, "hey, irs, i have a lot of money offshore, please tax me" the irs might even look closer to your financial situations...if teh US gov got interested in your financial dealing, then you'll be in serious trouble. it is not that hard for them to find out all your account activities and your bank wire to online sportsbooks.

i'd say, it seems like you're asking for trouble. but i'd like to know if anyone has fillout the forms for tax year 2005 or 2004.

This is true. It opens up a can of worms. However, if the IRS gets this information compliments of Neteller, the can is already open. All they have to do is some simple cross referencing to figure out who should have filed this form and those who didnt. Now they got a list they can work pretty hard. I dont want to be on that list.

[durito]

.

[pico]

This is true. It opens up a can of worms. However, if the IRS gets this information compliments of Neteller, the can is already open. All they have to do is some simple cross referencing to figure out who should have filed this form and those who didnt. Now they got a list they can work pretty hard. I dont want to be on that list.

sounds true. but in reality if irs catches you and you only had money in neteller for like 5 days...say you had 20k-30k...i doubt they'll fine you 500k for that. realistically, i can see them fine you couple of hundred to couple of thousand...i don't know anyone got audited, so i am not sure how irs fines works. if anyone has experience, post it here.

i think there are risks to file the form. seems to me if you file a form to the irs stating that you recieved money from Enron as an income, i bet the gov will look in to that. neteller is taking the heat right now, so filling out the form would actually make you stand out.

[DrunkenLullaby]

Paypal was always based staeside so no need to declare it. Only accounts based outside of the US have to be declared.

Good point John. My bad.

[Scooter]

SBR_John - "OK, I will see if I can get him to come on here. There is no link. I called two tax attorneys and both said it was required."

Any success in getting them to post an opinion here?

Can you reveal their names?

I would like to learn more.

[wisdom]

Neteller never even asked for a ss# unless you had a debit card .

[pico]

Neteller never even asked for a ss# unless you had a debit card .

good point, so the info you provide them are just your name, address, phone number and bank account.

the us gov can find out your ssn from your registered neteller bank account? does that violate some kind of customer privacy rule?

[increasedodds]

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[increasedodds]

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[increasedodds]

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[SBR_John]

The tax attorney has promised to write an explanation that I will post.

As far as those weighing their choices between filing or not filing I think everyone is different. Certainly my situation is different than most posters I would guess. I always assume I will be audited so I ask my tax people to not cut any corners.

I don't want to come off as recommending you file this because I dont know your situation. But I think for those who always play it close to the vest it makes sense. Certainly if you have already filed this in past years, like I have, it makes the most sense to amend it and disclose the neteller account.

[hitbitritz]

Thanks John for the info. Fortunately for me, I don't have a dime in neteller.

[Wheell]

It would appear said tax attorney never wrote his explanation. Or, SBR_John never bothered to post it.