YPN Partnerships - Be Careful

Just out of interest what do you guys think the IRS are going to say when you declare that 50% ofyour income mysteriously disappeared to someone in a different country?

 

*knock* *knock* right before your front door busts open and federal agents raid your house.. You've got to love the Patriot Act (sarcasm)

 

I don't unserstand your comment.
"Mysteriously disappears"? Umm, unless you met the person and handed them cash there would be a very easy to follow paper trail.
Do you realize how many international transactions are made each day? lol. I buy products and/or services from 5-6 countries. I have been doing this since 1997. I never had a problem with the IRS even when I was audited. In fact it was never even mentioned.

 

hes not talking about buying stuff. hes talking about legal taxable income. of course, you are right, there is no mystery. the paper trail is long and electronic. mystery solved.

 

Kara I think you need to re read my previous post. "I buy products and/or services".
I send $$$$ to different people/companies overseas for services such as freight forwarding, loading services, inspection services, web development, programming etc etc.
The payments in many of these cases were/are made to an individual and most of these payments are in the $xxxx range.
Many of these payments are made via Wire transfer but many are also made via Xoom.com.
In fact I sent $xxxx a couple of weeks ago to someone on this forum who is not in the US but who makes headers and banners for me.

It's not uncommon for a person or business to avail the services of someone from another country.

Taxable yes if it is added to your tax return as income but you would have to be insane to pay taxes on money you sent to someone else. Who would do this?
As a favor I let a friend PP me high $xxx and I in turn sent it to him via xoom. Im not going to pay taxes on that money. I also asked my accountant and he said if it came in and went back out of my account then not to worry about it. He did say to make sure that he doesnt dispute the payment after I had sent the money via xoom. I had already considered this and felt the risk was nominal.

 

if ypn reports that you made X dollars (taxable income) and you give half to some partner and only claim half of X dollars, you may have a problem. if however, you claim the full x dollars and have a deduction of half for services rendered, etc, that is a different story (assuming you are capable of deducting this amount - personal accounts may find it more difficult than corp. and that you have documentation to prove it). im not arguing with you, but that guy is kinda right. if you claim that your gross taxable income is less than what ypn reports, you will have a huge red flag with the IRS.

i buy services and products from all over the world. but these are legit expenses and i count them as deductions. with products i have my receipt. with services i have an invoice from that persons company. these make for legit deductions. but giving half your money to another individual and only claiming half your gross taxable income....? good luck. the irs wants their money.

 

Yeah but I think the use of the word "partner" is really kind of misleading.
If I rented a channel to someone (for clarification I would never actually do this) and charged them $1000/month and they earned $5000/month and I take the $1000 and claim it as income and then pay them the $4000 I am not going to pay taxes on the $4000.
How my accountant chooses to do this is up to him. It makes no difference that I paid the $4000 to someone outside of the US.

Im not sure if it would make a difference if you are an individual or a corporation. For my LLC I pay the taxes on my personal tax return.

 

when you're in a partnership you're supposed to write off the parter's part, so he pays his taxes by himself...
that way you should end up paying taxes only on your part