Claiming EU Withdrawal on Taxes

Has anyone had to do this? I have not, but am curious in case I ever need to.

If I deposit $600 on 12/1/14 and then withdraw $650 on 1/1/15, (example only), do I have to claim the money on tax return in US? If so, is it $50, or $650? Would I need to amend 2014 return to subtract the $600 from income that year and then claim $650 income 2015?

What if deposits go back several years, but you make one big withdrawal, say the withdrawal is less than total deposits? I imagine a large withdrawal would be flagged to the IRS, but it technically wasn't income, you actually lost money on already taxed revenue, right?

Say you got really lucky and made $10,000 ped one year. Does it count as capital gains? What if it was 100% from CLD/AUDs, is it capital gains then?

(Note, I'm not in any of these positions right now, but I'm sure others have been, so I'm curious.)

 

Should consult a tax professional.

From my stand point, I consider any withdrawls against my deposits as a return on principal. In the unlikely event I withdrawl more than I deposited, it would be capital gains not reported by 1099.

Who is to say that is how it works.. I don't think anyone could possibly know with this retarded tax system. But I can say you didn't earn 650. You earned 50. And it should be 15% of that 50. But be sure to keep incredible records because income not reported by 1099 gets looked at as suspect if you have claimed a lot.

 

I think the keeping incredible records is great advice, as is consulting a tax professional.

Thanks, $5.

When you say 15% that would seem to indicate it IS counted as capital gains, as I would think it should be.

 

It is an investment vehicle. . So it would have to be capital gains.

 

Or is it gambling income? Which is not taxed (at least not in the UK).

 

It is in the US as is lottery wins which is not taxable either in the UK.

 

1. You have to show a Net Gain, so if Deposits is Greater Than Withdrawals, no claim.
2. In case of Deposits over Withdrawals, you may even be able to Itemize a LOSS on your Taxes.
3. US Taxes both Gambling and Capital Gains. In theory, EU can be considered only Capital Gains... as it would be illegal for them to be 'Gambling'.
4. So if you Withdrew at Profit, and it was large enough to be noticed, you would file it just as a Stock you sold or any other Investment you have. Now, $5 here or $25 there a Year likely isn't enough for it to go on Paper, but anything hitting $1,000 can really mess you up if you are ever Audited later.

 

I am not a US citizen and certainly no expert in US taxes but I remember reading somewhere that this is not considered taxable as it is not gambling, nor an investment etc, it is a computer game. I think there was a thread on PCF but I cant find it now. May be worth taking a look yourself as I am not great at finding anything, especially on forums.

 

By definition, any Game that Pays Out Real Money... has to either be an Investment or Gambling. Since On-Line Gambling is Illegal in the US (which is why most of the Poker and Bookie Sites are 'off-shore'), we tend to suggest the EU is 'Investing' as there is just that, an Investment in hopes of Returns.

The US hasn't put a legal declaration on the game, but I promise you if a US Citizen were to Withdrawal $100,000 from EU the IRS would be right there if it wasn't Reported.

As I said, $100 here or $100 there is to small for the IRS to notice... I know people in Tip Jobs that never report because it's enough to slide under the Radar with, especially if the Tip Job is a 2nd Job, Part Time.

America may be the land of the Free, but we are also the Land of the IRS, and they don't mess around.