I do not know a damn thing about taxes but would like to know how it works for us in the United States. I know every dollar you earn is suppose to be taxed. Whether its working income or gamblling or lottery.
I have a few scenarios that comes to my mind and would like someone to give me an answer to these questions. I always have lots of questions and never really know the answers to them.
1. What if someone finds money on the floor? I know many times you find 1 dollar or 10 dollars on the floor and say free money. I do consider this free money because you can take that 10 dollars and buy yourself a sandwich or something like that. However, what if you are someone that finds a lot of money? Imagine your someone who found $2000 a week every week for a year and find about $100,000 a year. Would this person have to report taxes? Like imagine you are walking around and found a briefcase with $300,000 in real money in 100 dollar bills. Back a few years ago when i was younger, i would say hey im rich. But right now i would say... what can i do with this money? Am i even allowed to buy a car if i have no income? If you find this amount of money and store it in you house under the bed... what the heck is the point of this? Yes you can use the cash to buy computers and stuff like that but what else can you do besides buying food at the supermarket etc.
Would you have to report this $300,000 to the IRS? I would estimate you keep about $195,000 because i recall its 35 percent tax bracket when its over some huge amount. Would you tell your accountant you found this money whether this amount can be found one time or many times in a year?
2. The people who work in restaurants and own them. I read online many restaurants and small businesses do cheat in their taxes unless their some corporation like Starbucks or Mcdonalds which is impossible. The same can be said about stores or cornerstores and deli's. If they report a certain income for the year like $45,000 after taxes and salaries have been paid... but their true income is like $80,000... then what can they legally do with the other $35,000. I don't know if this number is right but does anyone know how much restaurants or stores cheat approximately off their taxes?
What can they do besides putting it in their homes if they cannot do anything big with it like buy a nice car or something towards their home if they live in a house? What about people who works for those jobs under the table? Assuming a person makes $40,000 a year in those jobs, what can they really do with the money? They cannot buy home or car can they since working under the table and those cash only jobs are illegal. I read on yahoo answers about a person wanting to buy a house but this person cannot because he works under the table. The people who help move furniture etc... if these people say over 1 year make about $35,000, what can they really do with this money?
3. People who sell drugs. The ones that sell them at the corner or in bundles. Assuming these people make $100,000 a year, what do these people do with their money? I know once your caught your in jail, but to those who don't get caught, what can they do with their money? Are there actual drug dealers that live in a very nice place besides living in those bad neighborhoods? If they do, how do they report their income?
4. Those people who steal whether they rob places or people. Like in America's most wanted i saw there was a group of robbers who robbed a bank for $5 milllion dollars or so. Assuming these guys don't get caught which rarely happens, what can they do with their money? I mean if they go buy a big house or nice car, wouldn't they be in trouble? If these guys were to file their taxes... could they say something like they got this money from winning this amount at the casino across the United States? I mean... wouldn't casinos not know because even they they estimate their revenue for the year... they don't really know the big winners. I read lot of them just store the money under the bed or under some place in their homes. But are these people really rich if they never get caught?
5. People who bet sports with locals. I know some people bet online with those sportsbetting sites but i know the majority uses locals. Do these people who bet with locals pay taxes? I mean if someone who just bets $100 and maximum $500 and during the year they are up $12000 or so, how the heck can the government know. What about those people who bet with a lot of locals and bet $2000 and $5000 a game and average $120,000 a year. Do the majority of these people who win pay taxes? If they don't, wouldn't that mean they cannot buy a nice house or car with their winnings? Would it depend if they have no job or if they have a job like somejob in an office and make $40,000 a year. Like if they both report their 120,000 income, would that still be considered other income like winning this amount at the casino? To the people who don't report their income, what can they do with this money? Same with bookies. Since the majority of them make money, how do they spend their money since they cannot really buy a house with it since bookmaking is illegal.
A situation that is easy for me to understand is if you win the lottery. Imagine if you win the lottery for $50 million. I know if you take a lump sum and get about $25 million after taxes, theres nothing confusing about this for me. I know that after taxes whatever amount you get... the amount is legally yours. you can go and put $3 million in 7 or 8 bank accounts you have and everything is fine because the money is yours and you can do what the heck you want with your money whethers its buying a nice house or a nice car.
The other 5 examples i wrote, i would like to know what happens in each scenario. Can someone give me some answers to these? I might assume there are some answers that might even give all the answers to these questions but can someone tell me how the scenario would work in each situation? I know theres a lot of crime and fraud in the U.S but would like to know what do those people in these 4 situation do.
Some answers i heard from another forum was spend it slowly. So basically someone can have 10 million dollars but cannot buy a home because the money is stolen or made illegally?
Thanks.
I have a few scenarios that comes to my mind and would like someone to give me an answer to these questions. I always have lots of questions and never really know the answers to them.
1. What if someone finds money on the floor? I know many times you find 1 dollar or 10 dollars on the floor and say free money. I do consider this free money because you can take that 10 dollars and buy yourself a sandwich or something like that. However, what if you are someone that finds a lot of money? Imagine your someone who found $2000 a week every week for a year and find about $100,000 a year. Would this person have to report taxes? Like imagine you are walking around and found a briefcase with $300,000 in real money in 100 dollar bills. Back a few years ago when i was younger, i would say hey im rich. But right now i would say... what can i do with this money? Am i even allowed to buy a car if i have no income? If you find this amount of money and store it in you house under the bed... what the heck is the point of this? Yes you can use the cash to buy computers and stuff like that but what else can you do besides buying food at the supermarket etc.
Would you have to report this $300,000 to the IRS? I would estimate you keep about $195,000 because i recall its 35 percent tax bracket when its over some huge amount. Would you tell your accountant you found this money whether this amount can be found one time or many times in a year?
2. The people who work in restaurants and own them. I read online many restaurants and small businesses do cheat in their taxes unless their some corporation like Starbucks or Mcdonalds which is impossible. The same can be said about stores or cornerstores and deli's. If they report a certain income for the year like $45,000 after taxes and salaries have been paid... but their true income is like $80,000... then what can they legally do with the other $35,000. I don't know if this number is right but does anyone know how much restaurants or stores cheat approximately off their taxes?
What can they do besides putting it in their homes if they cannot do anything big with it like buy a nice car or something towards their home if they live in a house? What about people who works for those jobs under the table? Assuming a person makes $40,000 a year in those jobs, what can they really do with the money? They cannot buy home or car can they since working under the table and those cash only jobs are illegal. I read on yahoo answers about a person wanting to buy a house but this person cannot because he works under the table. The people who help move furniture etc... if these people say over 1 year make about $35,000, what can they really do with this money?
3. People who sell drugs. The ones that sell them at the corner or in bundles. Assuming these people make $100,000 a year, what do these people do with their money? I know once your caught your in jail, but to those who don't get caught, what can they do with their money? Are there actual drug dealers that live in a very nice place besides living in those bad neighborhoods? If they do, how do they report their income?
4. Those people who steal whether they rob places or people. Like in America's most wanted i saw there was a group of robbers who robbed a bank for $5 milllion dollars or so. Assuming these guys don't get caught which rarely happens, what can they do with their money? I mean if they go buy a big house or nice car, wouldn't they be in trouble? If these guys were to file their taxes... could they say something like they got this money from winning this amount at the casino across the United States? I mean... wouldn't casinos not know because even they they estimate their revenue for the year... they don't really know the big winners. I read lot of them just store the money under the bed or under some place in their homes. But are these people really rich if they never get caught?
5. People who bet sports with locals. I know some people bet online with those sportsbetting sites but i know the majority uses locals. Do these people who bet with locals pay taxes? I mean if someone who just bets $100 and maximum $500 and during the year they are up $12000 or so, how the heck can the government know. What about those people who bet with a lot of locals and bet $2000 and $5000 a game and average $120,000 a year. Do the majority of these people who win pay taxes? If they don't, wouldn't that mean they cannot buy a nice house or car with their winnings? Would it depend if they have no job or if they have a job like somejob in an office and make $40,000 a year. Like if they both report their 120,000 income, would that still be considered other income like winning this amount at the casino? To the people who don't report their income, what can they do with this money? Same with bookies. Since the majority of them make money, how do they spend their money since they cannot really buy a house with it since bookmaking is illegal.
A situation that is easy for me to understand is if you win the lottery. Imagine if you win the lottery for $50 million. I know if you take a lump sum and get about $25 million after taxes, theres nothing confusing about this for me. I know that after taxes whatever amount you get... the amount is legally yours. you can go and put $3 million in 7 or 8 bank accounts you have and everything is fine because the money is yours and you can do what the heck you want with your money whethers its buying a nice house or a nice car.
The other 5 examples i wrote, i would like to know what happens in each scenario. Can someone give me some answers to these? I might assume there are some answers that might even give all the answers to these questions but can someone tell me how the scenario would work in each situation? I know theres a lot of crime and fraud in the U.S but would like to know what do those people in these 4 situation do.
Some answers i heard from another forum was spend it slowly. So basically someone can have 10 million dollars but cannot buy a home because the money is stolen or made illegally?
Thanks.
