No taxes on IQD Certificate of Deposit this year!?!

[J-W-S]

scenario

Q#1 I take all of the IQD i have in my Warka Bank account and put it into a 6 month CD today. The RV happens in 3 days. I now don't have to report my earnings from the reevaluated currency in the CD until I have access to it after the 6 month period even if the RV happens before the end of the year. True or False?

Q#2 Now that I have all of my IQD in a CD in Warka, for this year's taxes I can

A - report it as investment expenses or

B - report it as an asset or

C - don't report it at all.

Q#3 Let's advance to when I have to do taxes for next year. I will have to report my earnings from the CD as

A - capital gains

B - normal income

The whole point is to roll over taxes on the RV to NEXT YEAR instead of having to report them on this years taxes, legally!! I would greatly appreciate any help or advice on these questions! Adam Montana?!? Someone?!? Thanks in advance

[TC987]

Q#1 - True - As far as the RV goes, you won't have to report anything for taxes until you exchange the foreign currency for U.S. Dollars (because technically you haven't earned anything until it is translated back to USD).

Q#2 - I am no foreign income expert so I better stay away from trying to answer this one.

Q#3 - If you have cashed in all of your dinar after the RV occurs then you will have a capital gain on the transaction. As far as the earning on the CD go, I would think they would be considered interest income similar to an American CD, and be included in ordinary income.

Again I'm no foreign income expert so you may want to seek the advice of a professional who deals with foreign income and taxes.

Great questions and I would think a clever "tax management" strategy.

Edited December 20, 2010 by TC987

[PhillyDinar]

HERES AN EVEN BETTER IDEA!, JUST RE-INVEST WHAT EVER YOU DONT PLAN ON CASHING OUT (OR SPENDING) THEN YOU HAVE TO PAY TAXES ON ANY OF IT...

EXCEPT FOR WANT YOU PLAN ON CASHING OUT (OR SPENDING)!!!!!!!!!!!!!!!!!

THATS WHAT THE RICH PEOPLE DO!

PLUS IF YOU OWNED A NEVADA CORP, ANY PURCHASE YOU WANTED TO MAKE ALL YOU WOULD HAVE TO DO IS MAKE THAT PURCHASE THROUGH YOUR CORP, AND WHATEVER YOU BOUGHT WOULD BE TAX FREE.. BECAUSE ANYTHING YOU BUY WITH YOUR CORPORATION IS SPENT WITH PRE-TAX MONEY...

COMPLETELY LEGAL AND COMPLETELY ETHICAL!!!!

PLUS U SAVE A S**T LOAD OF MONEY IN THE PROCESS...

TIME TO START THINKING LIKE A RICH PERSON IF YOU PLAN ON KEEPING ANY OF YOUR NEW FOUND WEALTH!

[MahiMahi]

HERES AN EVEN BETTER IDEA!, JUST RE-INVEST WHAT EVER YOU DONT PLAN ON CASHING OUT (OR SPENDING) THEN YOU HAVE TO PAY TAXES ON ANY OF IT...

EXCEPT FOR WANT YOU PLAN ON CASHING OUT (OR SPENDING)!!!!!!!!!!!!!!!!!

THATS WHAT THE RICH PEOPLE DO!

Are you saying reinvest your dinar? Because if you cash out and then reinvest immediately... you have to pay taxes on that, no?

[PhillyDinar]

Are you saying reinvest your dinar? Because if you cash out and then reinvest immediately... you have to pay taxes on that, no?

YES I WOULD JUST RE-INVEST THE DINAR(ONLY BECAUSE AT CURRENT MOMENT THE US DOLLAR IS IN THE SHITTER AND ON ITS WAY DOWN, BUT RV COULD CHANGE THAT SO DONT QUOTE ME )

HOWEVER, YOU CAN CASH OUT YOUR DINAR FOR US CURRENCY IF YOU CHOOSE, AND AS LONG AS YOU RE INVEST THAT PROFIT FROM THE EXCHANGE BEFORE TAX TIME (AND IT REMAINS IN THAT INVESTMENT) YOU DO NOT HAVE TO PAY TAXES ON YOUR EARNINGS... THE ONLY TIME YOU HAVE TO PAY TAXES ON YOUR INVESTMENT IS WHEN YOU KEEP YOUR EARNINGS (EG. YOU CASHED OUT AND NOW THE MONEY IS JUST SITTING IN A CHECKING OR SAVINGS ACCOUNT)

AS LONG AS YOUR MONEY (OR PROFITS) ARE TIED UP IN AN INVESTMENT YOU DO NOT! HAVE TO PAY TAXES ON THAT PROFIT.... (CD'S, IRA'S, REAL ESTATE, ECT...)

NOW THIS IS ONLY GENERAL INFO..... THIS IS IN NO WAY SHAPE OR FORM LEGAL TAX ADVICE.

ALWAYS SEEK A CERTIFIED TAX ADVISER!

I LEARNED EVERYTHING I KNOW SO FAR FROM DOING MY HOMEWORK AND A BIG KEY TO MY HOME WORK WAS "RICHRD KYOSAKIS" BOOKS, I HIGHLY RECOMMEND THEM!

EXTREMELY EASY TO READ AND VERY EASY TO COMPREHEND! "RETIRE YOUNG RETIRE RICH" IS MY FIRST ADVICE, THEN "WINNING IN THE CASH FLOW QUADRANT" ALL THE OTHERS ARE MORE SPECIFIED TO YOUR DESIRED NICHE.

REALLY HOPE THIS HELPS.. GOOD LUCK!

[Frank61]

scenario

Q#1 I take all of the IQD i have in my Warka Bank account and put it into a 6 month CD today. The RV happens in 3 days. I now don't have to report my earnings from the reevaluated currency in the CD until I have access to it after the 6 month period even if the RV happens before the end of the year. True or False?

Q#2 Now that I have all of my IQD in a CD in Warka, for this year's taxes I can

A - report it as investment expenses or

B - report it as an asset or

C - don't report it at all.

Q#3 Let's advance to when I have to do taxes for next year. I will have to report my earnings from the CD as

A - capital gains

B - normal income

The whole point is to roll over taxes on the RV to NEXT YEAR instead of having to report them on this years taxes, legally!! I would greatly appreciate any help or advice on these questions! Adam Montana?!? Someone?!? Thanks in advance

IRS tax code 988E RE: : capital gain foreign currency exchange

[TC987]

YES I WOULD JUST RE-INVEST THE DINAR(ONLY BECAUSE AT CURRENT MOMENT THE US DOLLAR IS IN THE SHITTER AND ON ITS WAY DOWN, BUT RV COULD CHANGE THAT SO DONT QUOTE ME )

HOWEVER, YOU CAN CASH OUT YOUR DINAR FOR US CURRENCY IF YOU CHOOSE, AND AS LONG AS YOU RE INVEST THAT PROFIT FROM THE EXCHANGE BEFORE TAX TIME (AND IT REMAINS IN THAT INVESTMENT) YOU DO NOT HAVE TO PAY TAXES ON YOUR EARNINGS... THE ONLY TIME YOU HAVE TO PAY TAXES ON YOUR INVESTMENT IS WHEN YOU KEEP YOUR EARNINGS (EG. YOU CASHED OUT AND NOW THE MONEY IS JUST SITTING IN A CHECKING OR SAVINGS ACCOUNT)

AS LONG AS YOUR MONEY (OR PROFITS) ARE TIED UP IN AN INVESTMENT YOU DO NOT! HAVE TO PAY TAXES ON THAT PROFIT.... (CD'S, IRA'S, REAL ESTATE, ECT...)

NOW THIS IS ONLY GENERAL INFO..... THIS IS IN NO WAY SHAPE OR FORM LEGAL TAX ADVICE.

ALWAYS SEEK A CERTIFIED TAX ADVISER!

I LEARNED EVERYTHING I KNOW SO FAR FROM DOING MY HOMEWORK AND A BIG KEY TO MY HOME WORK WAS "RICHRD KYOSAKIS" BOOKS, I HIGHLY RECOMMEND THEM!

EXTREMELY EASY TO READ AND VERY EASY TO COMPREHEND! "RETIRE YOUNG RETIRE RICH" IS MY FIRST ADVICE, THEN "WINNING IN THE CASH FLOW QUADRANT" ALL THE OTHERS ARE MORE SPECIFIED TO YOUR DESIRED NICHE.

REALLY HOPE THIS HELPS.. GOOD LUCK!

You should definitely seek the advice of a tax professional. As I understand the tax code, the second you exchange your foreign currency for USD, it has become a taxable event. Whether you re-invest the money or not, makes no difference on the tax consequences of this event. However, if you purchased the dinar through your IRA (which is mentioned on DinarTrades website) any gains through exchange would be considered part of your IRA and then would only be taxed upon distribution of the IRA. If you cash out the dinar and invest in a CD, or Real Estate you will have to pay taxes on the gain from the exchange. Thanks to Frank for the Internal Revenue Code Section reference. Also, you can create companies to shelter income legally as is mentioned here. However, just because your dinars are owned in the company doesn't mean it will not be taxable (regardless of which state you incorporate in). Also, you would have to establish that the company actually owns the dinar, but that is an easy fix, you can gift them to the company. Once that is done, and you exchange them for USD the company has then created a taxable event, and the company is liable for the taxes. I agree that this money would be pre-taxed within the company, and you have until the end of your tax period to reduce that liability, however, I would not want to create a company, and then spend all of my earnings/capital gains simply to reduce my taxes.

Just my thoughts . . . I love Kyosakis books and would recommend everyone to read them, but never sell yourself short. Even Kyosaki won't make an investment transaction without his "Investment Team's Advice."

[PhillyDinar]

just seek professional tax advice. obviously what ever answer u get from one person is going to be question by another. so that leaves you completely unsure of the answers you received.....

seek a tax adviser...

You should definitely seek the advice of a tax professional. As I understand the tax code, the second you exchange your foreign currency for USD, it has become a taxable event. Whether you re-invest the money or not, makes no difference on the tax consequences of this event. However, if you purchased the dinar through your IRA (which is mentioned on DinarTrades website) any gains through exchange would be considered part of your IRA and then would only be taxed upon distribution of the IRA. If you cash out the dinar and invest in a CD, or Real Estate you will have to pay taxes on the gain from the exchange. Thanks to Frank for the Internal Revenue Code Section reference. Also, you can create companies to shelter income legally as is mentioned here. However, just because your dinars are owned in the company doesn't mean it will not be taxable (regardless of which state you incorporate in). Also, you would have to establish that the company actually owns the dinar, but that is an easy fix, you can gift them to the company. Once that is done, and you exchange them for USD the company has then created a taxable event, and the company is liable for the taxes. I agree that this money would be pre-taxed within the company, and you have until the end of your tax period to reduce that liability, however, I would not want to create a company, and then spend all of my earnings/capital gains simply to reduce my taxes.

Just my thoughts . . . I love Kyosakis books and would recommend everyone to read them, but never sell yourself short. Even Kyosaki won't make an investment transaction without his "Investment Team's Advice."

just about any transaction you make which generates a profit is a taxable event! however if you re- invest your profits (you dont pay taxes on that profit!!)

its only when you keep those profit that you pay taxes on your earnings.

[ha ha]

Hold on to your Dinar as long as you can if you are to create non-tax event.