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Originally Posted by peachfront
(Post 19915045)
The statement that he avoids depositing etc. $10K or more a day is a confession of structuring under the Money Laundering Act of 1986 for starters. To advise others how to structure payments is also structuring. Honestly, the entire thread should be removed. The first post is a clear violation. If you want more discussion, ask an attorney with experience in this area and in the area of forfeiture. This guy is playing with fire, and I'm OUT of this discussion. He's just asking to have his bank account and his cash seized. The act of structuring is illegal. Moving cash openly and honest is NOT illegal. All they're asking you to do is comply with the rules and file (or have filed) the proper document. What is so hard about having a proper currency report filled out if you have a certain amount of money? Nothing, if you're honest. Takes but a few minutes.
Again read the post .... who wants to create more work. You don't need to be so RUDE |
Originally Posted by flatus
(Post 19914642)
I think he's asking what the limit is, not how to get around it. Is this really illegal to ask? Can you provide a legitimate reference?
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Thank You Andy for an intelligent and educated answer. I appreciate it and again as I stated was only asking for info purposes. I have nothing to fear from any reports frankly so I don't care at this stage of my life but was asking because I unlike some don't want more work or time taken.
If I can save a 2 hour questioning I will just like not driving to ATM's or stores to get cards or money when my life is more important to me most of the time. Thanks again
Originally Posted by Andy2
(Post 19915059)
Your questions are incredibly broad and you might want to google a few keywords if you want to learn more: Currency Transaction Reports, Structuring, Suspicious Activity Reports. The flyertak threads on dollar coins and 1099s from banks have some good reading material.
In general, financial institutions must file Currency Transaction Reports for deposits of cash (including money orders made out to yourself) of 10K or more. These financial institutions must keep internal paperwork for deposits between 3K and 9.99999K, not for 5K or more like you suggested in your question. A lot of Currency Transaction Reports get filed each year, so it is not clear if the filing of one of these really increases the likelihood that you will get investigated. It is a felony called Structuring to arrange your deposits to avoid having the bank file a Currency Transaction Report. You do not want to obtain 12K and then deposit 8K at one bank branch and 4K at another branch of that bank. Money really does get seized by the government and people really do go to jail for Structuring, as wrong as that seems. Most Structuring is discovered by banks filing Suspicious Activity Reports. Banks file these forms with the government when they feel that something suspicious is occurring. Usually you can tell this is happening because they ask for information from your Drivers License, even though you did not deposit more than 10K. Resistance is futile and it looks worse when they file the Suspicious Activity Report and say the guy's face turned green and he ran out of the bank. Most of us who get miles from financial transactions have probably had these filed. Like CTRs, it is not automatic that the receipt of a SAR causes the government to investigate you. A lot of SARs get filed, although not as many SARs are filed as CTRs. Certainly, depositing a lot of money orders (made out to yourself) at the bank increases the risk of a SAR being filed, but no one knows how great that risk is. None of use will ever agree as to the taxation of miles, or the value (if any) of miles and points for tax purposes. There are a lot of tax rules such as the Rebate Rule that many posters believe will allow miles to often be earned without the inclusion of any amount in taxable income as a result of the receipt of miles. This Rebate Rule is a little harder to apply when earning miles through purely financial transactions, so the argument for little or no value of miles/points becomes more relevant. I get amused by the people arguing in the Valuation thread that their miles are worth the retail cost of a first class ticket (which no one actually pays) without considering the negative tax consequences of such an argument. Once again, check out the 1099 thread for more information. |
Once again accurate of my intension Thank You
Originally Posted by AllanAtlanta
(Post 19915207)
Maybe I'm reading this different than everyone else but I interpret his question to be around staying under the radar. Buying MOs for points is not illegal. If you really want to stay under the radar do about $1,000 a week. That's a nice 50,000 points.
I suggest also that you don't BS or lie to the cashiers or tellers about it. If you tell them it is for points and then later have a government entity get involved you will not have to play games. Keep good records and be prepared to share them if you need to. The truth is always your strongest defense unless you are a criminal. In my opinion your real risk is the bank you are depositing to will shut you down as a fraud/security risk. Be sure you can live with that account being frozen for a few weeks if they decide to close it on you. They can sit on your money for something like 10 business days AND be real slow about getting you a check. |
Originally Posted by peachfront
(Post 19915045)
The statement that he avoids depositing etc. $10K or more a day is a confession of structuring under the Money Laundering Act of 1986 for starters.
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Originally Posted by Stoughton
(Post 19915423)
:rolleyes:
I am not refined enough to just roll my eyes LOL |
Originally Posted by abnz
(Post 19917006)
I have looked through the first post carefully, and cannot find any such statement. Can you point to it please? But I do realise that in the United States, mere existence is a criminal act.
Geez Folks only intended to find out what LEGAL LImits might be on taxation ect. Not as smart as some of you all but it wasn't that hard of a question as some picked up on THANKS |
I can't blame the OP for being annoyed. It's not like he was asking how to find good hidden-city bookings. :)
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Originally Posted by Andy2
(Post 19915313)
We would like to think, or at least hope, that miles earned from credit card spending are nontaxable but that may not always be the case. The reason that the miles are usually viewed as nontaxable is the Rebate Rule, which allows the user to reduce the basis of what he purchases with the card by the fair market value of the miles (if any). Usually there are no tax consequences to this. But if Nottafatslob has figured out how to purchase 100K of money orders with his credit card, and he deposits the 100K and uses the funds to pay his credit card bills, it is hard to figure out how to apply the Rebate Rule in a manner to escape tax consequences if the miles/points do, in fact, have any value. If the miles theoretically had a value of 1K, it looks like he deposited 100K of cash with a basis of 99K and then withdrew the 100K. Some would argue that this results in 1K of taxable income and it makes everyone's head explode who tries to reason it through. That is the reason the tax results are easier if the miles are worth $0.00 instead of 1K. It is not something most people worry about because the credit card company will not issue a 1099 to Nottafatslob in this situation.
I don't think the fact that at the end he has $100K of value plus the miles necessarily disqualifies the buyer from invoking the Rebate Rule. As a related issue, what about the buyer of a discount restaurant gift card with face value of $100 for $90. When he redeems it for goods or services that would normally have cost $100, must he declare a $10 income, or is it like any coupon discount or mail-in rebate, simply a "reduction of purchase price" bargain? (Or how about discount sales of stamps at less than face value, where the purchaser then uses them for postage at face value? Is that income to the buyer? Or just getting the service at a discount?) Or does the fact that the person starts and ends with $100 in cash and gets the miles in the process make the miles "income" from the transaction, just as would be the case with the discounted gift card if, instead of using the card himself to get $100 in goods and services, he turned around and sold it for $100? Or for $95 and some miles? You're right -- this makes my head hurt. Disclaimer: This is not intended as legal advice, merely hypothetical discussion. I an NOT a tax lawyer! |
lol you're all a bunch of crazy nerds! Just answer the poor guys original post. jeez !
merry christmas |
Originally Posted by peachfront
(Post 19915045)
The statement that he avoids depositing etc. $10K or more a day is a confession of structuring under the Money Laundering Act of 1986 for starters.
Originally Posted by peachfront
To advise others how to structure payments is also structuring.
The tax consequences and other filing situations related to miles/points earning vary by jurisdiction and individual circumstances. Governments can be Scrooges. When the technical headaches of monitoring and valuing miles/points get resolved, taxation of the miles/points will become more a part of the taxation/reporting picture. Merry Christmas and Happy New Years to all, including those to whom Santa delivers $10k or more or way, way less in cash. |
Merry Christmas ALL
I will have the discussion over Christmas Dinner today where there will be 2 Corporate Attorneys, a CPA, and a Banking Executive and make them all sign a GAG Order and agree to Confidentiality and take an oath in blood before I pass the Gravy. Smile Life is Good -Cheers
Originally Posted by GUWonder
(Post 19917826)
Even if such a statement were to be made, that is not necessarily a prosecutable violation of law in the US. Avoiding depositing $10k or more a day is a routine state for most people in the world since most people don't have $10k or more in cash on any given day to deposit. De facto, they avoid deposting $10k or more a day.
There is nothing illegal in the US to discuss what actions -- by one's self or by others -- or perceptions -- held by one's self or by others -- may result in: filing requirements; and/or problems arising from filings, required or not, made by one's self or by others. The tax consequences and other filing situations related to miles/points earning vary by jurisdiction and individual circumstances. Governments can be Scrooges. When the technical headaches of monitoring and valuing miles/points get resolved, taxation of the miles/points will become more a part of the taxation/reporting picture. Merry Christmas and Happy New Years to all, including those to whom Santa delivers $10k or more or way, way less in cash. |
Originally Posted by Counsellor
(Post 19917642)
Perhaps the transaction could be brought under the Rebate Rule by looking at the entire transaction. The seller doesn't receive the full $100K from the credit card company for the $100K he sold, but rather something in the neighborhood of $97K; the credit card company rebates a part of the money they made on the transaction to the original purchaser (cardholder) through the miles they "give" him.
I don't think the fact that at the end he has $100K of value plus the miles necessarily disqualifies the buyer from invoking the Rebate Rule. As a related issue, what about the buyer of a discount restaurant gift card with face value of $100 for $90. When he redeems it for goods or services that would normally have cost $100, must he declare a $10 income, or is it like any coupon discount or mail-in rebate, simply a "reduction of purchase price" bargain? (Or how about discount sales of stamps at less than face value, where the purchaser then uses them for postage at face value? Is that income to the buyer? Or just getting the service at a discount?) Or does the fact that the person starts and ends with $100 in cash and gets the miles in the process make the miles "income" from the transaction, just as would be the case with the discounted gift card if, instead of using the card himself to get $100 in goods and services, he turned around and sold it for $100? Or for $95 and some miles? You're right -- this makes my head hurt. Disclaimer: This is not intended as legal advice, merely hypothetical discussion. I an NOT a tax lawyer! There is no doubt that the Rebate Rule is a powerful way to avoid taxation. From all accounts it appears that Citi may be using this rule to not issue 1099s for the 2012 tax year. Time will tell if that is true. Citi now requires the "new account opener" to use a debit card and purchase a certain amount of goods and services to get the miles. If the Rebate Rule causes the recipient to reduce the basis of the goods he purchased by the fair market value (if any) of the miles, Citi will not issue a 1099. Perhaps that is Citi's solution to the controversy. None of its competitors issue 1099s under similar circumstances. I am still puzzled by the insistence by many that miles have value. It seems to me that the miles/points system has become a big coupon game. When I redeem the miles/points, I almost always pay something for the ticket. To me, I am simply using a coupon to purchase travel at a discount. If I collect 100,000 miles and redeem them for business-class international travel and pay $150 (or $185 on US Air), I place a value on the ticket of $150, the discounted amount I paid. That must have been what the ticket was worth, otherwise the airline would not have sold it to me for that. Many of the other business-class flyers paid $500 for a coach ticket and got a free upgrade. Sure there might be an occasional business class flyer who paid $5,000 for his ticket, but I hardly see how that causes my 100,000 miles to be worth $5,000. Most of the people arguing for this position are bloggers trying to get people to sign up for credit cards. When I clip coupons from the Sunday paper, no one argues that the coupons themselves have tremendous value. If I use a coupon to buy pork chops for $20 that otherwise would have cost $20, I do not consider the coupon to be of value; I figure that the store always planned to sell a few pork chops for the $20, which is why they issued the coupons. Just becuase the guy in the check out line behind me pays the $30 does not cause me to believe that my pork chops are worth more than the $20 (plus the coupon) that I paid for them. Seats for mile redemption are tag-along seats that the airline would otherwise not have sold, so the sell them to me for $150 and my coupons. I am not sure why those miles have any "value". The airline mile coupon system has a "gotcha element". If I have only 99,000 miles and I need 100,000 miles to buy my $150 business class ticket, I might succumb to the temptation of buying miles from AA at an exhorbitant price per mile to get to 100,000. Citi used that "gotcha" market in valuing the miles when issuing 1099s and I do not believe that market has any relevance. Hopefully, Citi is now finished issuing 1099s, and this topic will only be of academic interest since there are few reports of IRS audit activities relating to the fair market value, if any, of miles. Like you, nothing in my post should be considered tax advice. |
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