PAYPAL TAX

[AlteredMC Owner]

Can't take you serious with that profile picture xD

Lmao, this isn't my main, my main account is LinuxOS, but @OGMaster knows what happens to me weekly.

got hacked once again .

 

[Solistica]

I believe it's because you transferred it.

As far as I know you can have as much money in PayPal as you want, but as soon as you transfer it to a bank account it can be taxed and marked as income. So you can either pay your taxes to PayPal and they'll take care of it on their end, or I believe if you don't, next year the IRS will ask where all that extra money came from. Which could potentially result in a investigation into all your accounts, which would not be fun.

The Knock at the Door
"Your first encounter with the criminal investigation unit of the IRS may involve a knock on your door, followed by an intimidating encounter with two or more agents dressed much like K and J from the Men in Black movies. By the time this encounter takes place, the IRS has completed several steps of its investigation process and is convinced that the case against you is solid. Your best move under these circumstances is to say absolutely nothing."

Just incase

 

[AlteredMC Owner]

I believe it's because you transferred it.

As far as I know you can have as much money in PayPal as you want, but as soon as you transfer it to a bank account it can be taxed and marked as income. So you can either pay your taxes to PayPal and they'll take care of it on their end, or I believe if you don't, next year the IRS will ask where all that extra money came from. Which could potentially result in a investigation into all your accounts, which would not be fun.

The Knock at the Door
"Your first encounter with the criminal investigation unit of the IRS may involve a knock on your door, followed by an intimidating encounter with two or more agents dressed much like K and J from the Men in Black movies. By the time this encounter takes place, the IRS has completed several steps of its investigation process and is convinced that the case against you is solid. Your best move under these circumstances is to say absolutely nothing."

Just incase

Damn, thanks for the information.
So lets say I made like 22k in PayPal this like 6 months, how much tax do I have to pay? Someone said 10%, but is there like bonus fees?

 

[AlteredMC Owner]

Probably not if you pay it on time, fees will come if you try to ignore it and not pay it.

Like I mentioned previously, you're best way after making more than $5,000 a year, is to register it as a business, which in America costs about $50 and 2hrs and a quick drive to the local registration office. Say you host game servers and you could even call it like AlteredMC LLC.
(You'd want to look into registering as an LLC as well, best for minecraft-server-companies imo.)
Then you could file your companies taxes, with your own.

Basically with a business you get a tax break on things you spend using either your money, or the companies money, FOR the company.
Like a dedicated server for example, I pay $1,400 a yr in just server bills, so I can use that $1,400 as a write-off, since it's money I'm spending, to potentially make more money. That's my risk. That's also technically revenue for my hosting company, so THEY get taxed on what I buy from them, so they get their tax money on your end or their end one way or another.

So they would take my total revenue for the year, subtract $1,400, and then tax me on the remaining. Though we pay for a lot more than just server bills, so really like %30 of your income is potentially a write-off.

I do not know how much you owe right now, I would contact PayPal and see if they can give you more information.

In this scenario, PayPal is your friend, I'd much rather deal with them than the IRS or a collection agency.
Especially since the IRS doesn't have to 'ask', if you refuse to pay your taxes, and they see you have the money in your bank, they'll just empty your bank account and send you a letter saying "All good, but don't do this again next year!".

Want to be tax free?
Only accept Bitcoins, convert Bitcoins to credit, convert credit to cash.
This way would be extremely hard to find you through and to track but if they did somehow find out, you'd be arrested for tax evasion probably within 36hrs of them discovering it.
But no taxes!

Thanks! I'll just ask my daddy to convert what you said to english and drive to that house thing.

 

[AlteredMC Owner]

Best of luck!

I've tried going to my parents before and they never believe that I actually make money off of a game.
I'm like, I will show you the bank statements...
It's like the anti-christ to them, so weird. I think they're just jelly doe.

Haha, when I have the people that spam donate like $5 they're like wtf is with the guy.

 

[AlteredMC Owner]

Yeah I've had those before, some guy did like 32x $100 payments, next day it was all charged back because it was a stolen credit card.
Thus why I put a limit on how much my users can spend in a month.

LOL I havn't lost a chargeback, did you win that chargeback?

 

[AlteredMC Owner]

I did not, sadly when a card is stolen, neither Paypal or the credit company is really on your side. I assume that person when to jail though because he used real information in the Buycraft checkout, which I turned in to PayPal and the credit company. Hope that worked out for him.

oh dang, that's intense, what server do you own ( This is basically a conversation between us for future replies to this thread )

 

[AlteredMC Owner]

I wish not to tell people what servers I own/run. Sorry.

I know who you are

 

[Jack]

The form that PP provides you should already have the amount you owe.

 

[AlteredMC Owner]

nvmd i can't find your servers on google[DOUBLEPOST=1438294563,1438294531][/DOUBLEPOST]

The form that PP provides you should already have the amount you owe.

It's like a popup when i login to paypal saying to enter my ID, it doesn't say an amount.

 

[Jack]

nvmd i can't find your servers on google[DOUBLEPOST=1438294563,1438294531][/DOUBLEPOST]
It's like a popup when i login to paypal saying to enter my ID, it doesn't say an amount.

Send a screenshot.

 

[AlteredMC Owner]

Send a screenshot.

http://prntscr.com/7z0gyq

 

[Jack]

http://prntscr.com/7z0gyq

Lol that's normal. It's just recommended.

They won't actually require your tax info until you receive $20,000 in gross payments for goods / services:
https://www.paypal.com/us/webapps/mpp/irs6050w

 

[AlteredMC Owner]

Lol that's normal. It's just recommended.

They won't actually require your tax info until you receive $20,000 in gross payments for goods / services:
https://www.paypal.com/us/webapps/mpp/irs6050w

oooooooooo shit imma go tell my dad

Which I'm pretty sure he has.

imma check activity and verify 1sec

 

[Jack]

Which I'm pretty sure he has.

Well if he did and hasn't provided his TIN, then his account would be limited:

 

[AlteredMC Owner]

Well if he did and hasn't provided his TIN, then his account would be limited:

i had an old limited account, ok ok wait wait wait, lets chill..


so do i just hit remind me later forever.

and it also says somewhere about 200 purchases or something and then on another bullet it says 20k, do i need to just have 1 of those, because i know i have over 200 transactions of receiving money.

 

[Solistica]

oooooooooo shit imma go tell my dad

imma check activity and verify 1sec

I'm looking more into this and people are mentioning that if PayPal asks for your tax ID, that doesn't mean they want money from you now. They're simply trying to get the information needed, so that when tax season comes around (~6 months from now) then you'll have all the paperwork done and ready with PayPal in order for you to file.

Being as how PayPal is asking for your tax ID, chances are the IRS has already been notified that you're making over $20,000 a year, and they'll expect to see the paperwork on it when you file in 2016. If at that point, you fail to provide insight on your earnings, the IRS will come after you. Potentially resulting in an Audit.

i had an old limited account, ok ok wait wait wait, lets chill..


so do i just hit remind me later forever.

and it also says somewhere about 200 purchases or something and then on another bullet it says 20k, do i need to just have 1 of those, because i know i have over 200 transactions of receiving money.

As far as i can tell, you need to have hit both, $20,000 in sales, and at least 200 transactions.

Well if he did and hasn't provided his TIN, then his account would be limited:

I assume he just got this today or very recently, so PayPal may be giving him a grace period to get the Tax ID # if needed.


You CAN apparently put in your SSN, instead of a Tax ID, but then it's DEFINITELY tied to you.

 

[Jack]

i had an old limited account, ok ok wait wait wait, lets chill..


so do i just hit remind me later forever.

and it also says somewhere about 200 purchases or something and then on another bullet it says 20k, do i need to just have 1 of those, because i know i have over 200 transactions of receiving money.

 

[AlteredMC Owner]

I'm looking more into this and people are mentioning that if PayPal asks for your tax ID, that doesn't mean they want money from you now. They're simply trying to get the information needed, so that when tax season comes around (~6 months from now) then you'll have all the paperwork done and ready with PayPal in order for you to file.

Being as how PayPal is asking for your tax ID, chances are the IRS has already been notified that you're making over $20,000 a year, and they'll expect to see the paperwork on it when you file in 2016. If at that point, you fail to provide insight on your earnings, the IRS will come after you. Potentially resulting in an Audit.


As far as i can tell, you need to have hit both, $20,000 in sales, and at least 200 transactions.


I assume he just got this today or very recently, so PayPal may be giving him a grace period to get the Tax ID # if needed.


You CAN apparently put in your SSN, instead of a Tax ID, but then it's DEFINITELY tied to you.

it notified me when i moved 2k in my bank account in 1 transaction yesterday.

 

[Jack]

And I was getting that message a while ago, but after hitting 'Remind me later' enough it's stopped coming up (I've never been close to the IRS requirements anyways)