Am I obligated to pay taxes in this situation? Please help...

[schrodingerscat]

What is the name of your state (only U.S. law)?
California

If I make money from renting out an apartment in another country and then use that money to pay for my mortgage in US, am I obligated to pay US taxes from money I get in another country for my apartment?

The money doesn't actually come to me through any bank wire transfers. I get the money when I go into the country and bring it all in here in cash. Since I can bring up to $10,000 in cash to US per time, it works out fine.

The reason I ask this question is because IRS is asking me to show proof how I was able to pay for my mortgage in the past 6 years since I didn't file any income tax during this time; but I it's because I didn't have any US income. I'm a housewife. So I'm wondering how to go about in this situation and what steps I should take. Any help would be greatly appreciated.

Thank you!

 

[Mass_Shyster]

If I make money from renting out an apartment in another country and then use that money to pay for my mortgage in US, am I obligated to pay US taxes from money I get in another country for my apartment?

Yup.

The reason I ask this question is because IRS is asking me to show proof how I was able to pay for my mortgage in the past 6 years since I didn't file any income tax during this time; but I it's because I didn't have any US income. I'm a housewife. So I'm wondering how to go about in this situation and what steps I should take. Any help would be greatly appreciated.

You should speak with an attorney.

 

[Just Blue]

What is the name of your state (only U.S. law)?
California

If I make money from renting out an apartment in another country and then use that money to pay for my mortgage in US, am I obligated to pay US taxes from money I get in another country for my apartment?

The money doesn't actually come to me through any bank wire transfers. I get the money when I go into the country and bring it all in here in cash. Since I can bring up to $10,000 in cash to US per time, it works out fine.

The reason I ask this question is because IRS is asking me to show proof how I was able to pay for my mortgage in the past 6 years since I didn't file any income tax during this time; but I it's because I didn't have any US income. I'm a housewife. So I'm wondering how to go about in this situation and what steps I should take. Any help would be greatly appreciated.

Thank you!

I agree with Steve that you REALLY NEED an attorney that will assist with this Federal Tax Fraud case.

Px Hx is a MUST.

 

[schrodingerscat]

I agree with Steve that you REALLY NEED an attorney that will assist with this Federal Tax Fraud case.

Px Hx is a MUST.

Hi Blue Meanie. Thank you for your response. What does "Px Hx is a MUST." mean?

 

[schrodingerscat]

Yup.



You should speak with an attorney.

Thank you, Steve!

 

[tranquility]

I agree that at this point a tax attorney is appropriate. Your returns are certainly wrong. The key now is to make sure there is no intent behind the return. (intent to defraud)

While many preparers have some level of privilege, you really need an attorney to protect your rights.

 

[davew128]

I agree with Steve that you REALLY NEED an attorney that will assist with this Federal Tax Fraud case.

What tax fraud would that be? While its obvious the activity needs to be reported, who's to say it doesn't result in a LOSS?

Seriously, some of the responses here are completely over the top. OP, report the activity in conformance with US tax law and leave it at that. It really is that simple.

 

[LdiJ]

I agree that at this point a tax attorney is appropriate. Your returns are certainly wrong. The key now is to make sure there is no intent behind the return. (intent to defraud)

While many preparers have some level of privilege, you really need an attorney to protect your rights.

In reviewing his previous threads, its apparent that he plays pretty fast and loose with money/debt in general and appears to be fairly naive about money/debt/taxes in general as well.

The first thing that he needs to understand is that he is required to report his world wide income, from all sources, on his US tax return. Assuming of course, that he is a US citizen or green card holder. He also need to understand that he gets credit on his US tax return, for taxes he pays to the country where the money is earned.

Therefore, how much he is actually going to owe the IRS and CA, depends greatly on the net profit from renting the apartment, and the amount of tax he pays abroad. We don't have any actual figures here, so we don't know whether its going to get looked at as being fraud or not. If its 10k a year or more that he is not reporting, and he pays no tax abroad, then I agree, he needs to consult with a tax attorney ASAP. If its significantly less than that, and he is paying taxes abroad, then I would recommend getting his taxes amended ASAP, to see where he stands first.

It also matters that he appears to be married, and it appears that his wife is the one who owns the home. If they are filing joint returns her income is a major factor as well.

 

[ecmst12]

Well, he was already married in 2008 but was on a B1 visa in 2011, so I'm guessing the wife is not a citizen or green card holder either. And he owed 5 years worth of back taxes in 2008 as well, and it appears the house was put into the wife's name to dodge his debt. I think a lawyer DEFINITELY needs to be involved.