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partygirluk
10-12-2005, 11:25 PM
Currently reside in the UK. Pay 0 tax on poker winnings. Want to do PhD in States. U.S citizens pay tax on poker winnings. This sucks. Most of my poker winnings I would save up, until the day I decide to buy a property. I currently have a US$ account registered in the U.K. Have no idea if I would be able to keep it if I moved abroad.

Anyway, the sums we are talking about could be significant enough to deter me from studying in the U.S, but I do really really want to. What are my options? What is the tax rate?

Thanks,

Dean /images/graemlins/confused.gif

10-12-2005, 11:50 PM
Here is last year's income tax rate schedule. (http://taxes.yahoo.com/rates.html)

Different states also have different tax rates. Some, like TX have no income tax.

lucas9000
10-12-2005, 11:58 PM
i think you would be well advised to consult a tax attorney. it would cost you some money, but getting the correct information will likely save you more in the long run considering your situation.

partygirluk
10-13-2005, 12:28 AM
[ QUOTE ]
Here is last year's income tax rate schedule. (http://taxes.yahoo.com/rates.html)

Different states also have different tax rates. Some, like TX have no income tax.

[/ QUOTE ]

Does gambling count as income? i.e. if a Texas resident won the lottery, would he have to pay tax?

10-13-2005, 12:36 AM
Yes, gambling winnings count as income according to the IRS. I think you misunderstood me about the state income tax.

Most state's have a state income tax that must be paid by residents on top of the federal income tax. A few states such as, Texas have no state income tax at all. I think our sales tax is a little higher here in Texas to compensate for the lack of a state income tax.

Note however, that the IRS has no way to access pokersite's records to see exactly what your income is. If they decide to audit you though, they can utilize the paper trail from your banking institution to deduce your income.

partygirluk
10-13-2005, 12:38 AM
What if my account was not located in the U.S?

10-13-2005, 12:48 AM
I'm going to preface this with a big "I'm not sure."

But I don't believe the IRS can legally demand records from any foreign institutions. However, they may be able to trace any transfers from your foreign account to your physical location. I don't know if they'd be able to deduce that it is income though.

Remember, I'm not a tax professional though.

partygirluk
10-13-2005, 12:52 AM
OK. So say I make $100K in a year. I withdraw $20K of that to my U.S account to pay for living expenses. I transfer the $80K to an offshore account. They will tax me on the 20K, but not the 80, right? And lets say I do this for 3 years, and have 240 in my account (ignoring interest). I then want to buy a house and want to spend that 240k on it. How can I do so without the IRS finding out that I should have been paying tax on that 240K?

nothumb
10-13-2005, 12:53 AM
I think you'll be in the clear on this. As a foreign student you would probably have a student visa and you might not even be allowed to work, aside from under the terms of any assistantship you might have. They wouldn't expect you to file taxes if this was the case. I would check with US Immigration or whomever issues those visas, and find out what the law is regarding work under a student visa. As it stands, the IRS might not be expecting you to work, and therefore can't expect you to file.

EDIT: Basically, the IRS taxes income, not holdings of foreigners. If you were asked any questions about it, tell them it's savings or a trust fund, and it's not US income. They can't tax you on it if they can't prove you made that money in the USA.

NT

Brainwalter
10-13-2005, 12:55 AM
You're going to become a US citizen for this PhD? If not I don't think you have any problems.

partygirluk
10-13-2005, 12:56 AM
OK, but if they dont expect me to work, they wont expect me to make withdrawls to my bank account, right? And then if I am withdrawing 100K a year they will want to know where it is from. And when I tell them poker they will want to tax my arse off?

nothumb
10-13-2005, 01:00 AM
[ QUOTE ]
OK, but if they dont expect me to work, they wont expect me to make withdrawls to my bank account, right? And then if I am withdrawing 100K a year they will want to know where it is from. And when I tell them poker they will want to tax my arse off?

[/ QUOTE ]

Do you think they do this to rich foreigners who study in the states? Fcuk me, we had jihadists running around here receiving wire transfers for large sums of money and the IRS sure as hell didn't nail them. Other agencies might be interested in why you are transfering large amounts of cash to US accounts, but if you applied for a student visa and made it clear you had substantial savings you intended to use on your studies and expenses, they won't complain. Hell, they'll be happy, you won't be leeching off anyone here. I'd say the best thing you can do is keep the money in a registered UK account, right out in the open, and as long as you're legit in the UK they won't bother you.

NT

haakee
10-13-2005, 01:22 AM
Pay your [censored] taxes if you want to move here and earn money here.

mmbt0ne
10-13-2005, 01:38 AM
**ABSOLUTELY NO IDEA WHAT I'M TALKING ABOUT**

</font><blockquote><font class="small">En réponse à:</font><hr />
OK. So say I make $100K in a year. I withdraw $20K of that to my U.S account to pay for living expenses.

[/ QUOTE ]

Shouldn't be a problem. No one can prove any of that money was earned on US soil, and therefore should be taxed as such. You paid the necessary taxes in the jurisdiction the money was earned, which in your case was none.

</font><blockquote><font class="small">En réponse à:</font><hr />
I transfer the $80K to an offshore account. They will tax me on the 20K, but not the 80, right? And lets say I do this for 3 years, and have 240 in my account (ignoring interest). I then want to buy a house and want to spend that 240k on it. How can I do so without the IRS finding out that I should have been paying tax on that 240K?

[/ QUOTE ]

Same deal, IMO.

daveymck
10-13-2005, 05:27 AM
You need to consult a tax specxialist probably in the UK. Ideally I would think you want to stay under the UK system and use the treaty the UK and US has for netting off of taxes, therefore gambling = 0% so would be fine the same as any UK person who makes gambling winnings in the states. But it will depend I guess how often you come back to the UK and also if how long you are in the States triggers you to be in their system.

Its a complex area I was going to work in Southern Ireland for a bit and it becomes a bit of a nightmare when are part time in more than one country and are potentially earning while living in both.

Theres a little bit of adice in the link below but I really think I would see a tax specialist.

Some small advice more for IT people though (http://www.contractoruk.com/overseas_guides/it_contracting_usa.html)