Exchange Taxes

[LittleMissGrits]

Ok. look everyone....let's all stop trying to milk as much from this inevitable huge income as you can. Regardless of whether it is "regular income", "capital gains", 15% or 30%......you/we/I are all going to have way more money than we've ever dreamed of if this all goes right. No need to be greedy here. I'm getting ready to have maybe 45% taken away from my initial proceeds due to taxes. i will still be able to retire if need be. But I won't because that will be too boring of a life.

This is part of the problem ... we all just go along and pay, pay, pay regardless of what may be the right or ethical thing. Those kind of taxes are theivery, pure and simple!!!

[Draco]

Ambush_gorilla, I appreciate the time you spent talking to the IRS agents, many of which are complete ignorant bozo's that could never cut it in the private sector, but the info that they gave you is WRONG!

And the problem is that this is not a "personal" transaction. It is an investment. And as such does not fall under the section 525 of the IRS code that you stated. It falls under section 833, and is taxed as "regular income".

If you only pay the capital gains rate, in about 2 years the IRS will come back to you, tell you that you owe them the additional dollars, plus interest, plus penalties, and it will end up costing you over 50% of your profits.

Just pay them the 35% as soon as you cash in your dinars and be done with it. If the IRS subsequently makes a ruling that you owe less, (not likely), they will send you a refund. Just pay it and forget it.

You nailed it on this post. ExecConsult said these same words. In the end, why risk it. Pay the 35% plus state tax and go from there.

Draco

[Hawaii K]

Bruddah stuck here in VA.

I hope to move back to the Islands after the Dinar R/V's

and the kids get out the door for college.

We lived in Kanohe, across from the old Police

Station on Waipoo road. My dad taught Judo

there for a long time.

I graduated from School in California.

[tunisd]

According to my tax attorney and my CPA. Whom I trust implicitly! The tax code is very very grey and arguments can be made both ways as far as the taxes.

Just remember that not reporting income is a Federal Offense. But taxes are arguable.

[Draco]

This is part of the problem ... we all just go along and pay, pay, pay regardless of what may be the right or ethical thing. Those kind of taxes are theivery, pure and simple!!!

We go along with it because it is the Tax law, whether it is right, wrong or just down right theivery. The question is, would you rather be on the beach, in the mountains or what ever you like to do with your new wealth, or be in Tax Court trying to prove you are right when they say you are guilty of tax fraud when you walk in the door. Myself, I am going to take the least path of resistance. Pay more now, and maybe later I will take on the Big Bad IRS. Right, I would lose even later. Pay the tax and move on. GO RV!!!

Draco

[Mopper]

Less than one year - 35% tax until O screws with it

Long term capital gains - 15% tax until O screws with it

If the IRS wants anymore out of me, well come and find me. Oh and by the way Mr. IRS Agent, bring sunscreen !!

[Draco]

Less than one year - 35% tax until O screws with it

Long term capital gains - 15% tax until O screws with it

If the IRS wants anymore out of me, well come and find me. Oh and by the way Mr. IRS Agent, bring sunscreen !!

The only thing they have to find is the money, wihich is easy for the IRS. Anywhere in the world. Unless you have it buried in the sand next to you? Maybe we are on to something now.

Draco

[nashdinar]

Note to self.....Take some of the RV money and hire a GOOD Tax attorney. Nuff said.

[joe liberst]

After over an hour and speaking with 7 different agents at the IRS. I finally got a straight answer. IRS publication 525 page 33 about half way down the page states......"If you have a gain on a personal foreign currency transaction because of changes in exchange rates, you don not have to include that gain in your income unless it is more than $200. If the gain is mor than $200, report it as a capital gain."

The publication is available for download at www.irs.gov, just search publication 525.

I hope this puts to rest some of the misinformation on income/capital gain taxes.

All the best,

Ambush

Laws are open to interpretation, especially by the government. I would get an IRS ruling on the taxes in writing, not just a phone call.