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naraburns  nihil supernum  1yr ago (text post)   34939 thread views

Culture War Roundup for the week of January 30, 2023

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I'm annoyed at the reporting requirements too, but the mirror image of money laundering is tax evasion, and governments are very motivated to prevent tax evasion by any means possible, up to and including totalitarian monitoring of all money flows.

With respect to the specific requirements to report foreign accounts: the reporting requirement is clearly stated in tax instructions and up to a few years ago the IRS was remarkably lax about requiring people (with less than $50,000 in their accounts) to report on time. The form for reporting foreign accounts even included checkboxes where one could state one's "reason for reporting late": "I forgot" and "I didn't know I had to" were valid options.

Granted, I'm still a bit confused by the reporting requirements and process for large wire transfers.

governments are very motivated to prevent tax evasion by any means possible, up to and including totalitarian monitoring of all money flows

Absolutely. That motivation is why any hope of a non-totalitarian end state requires strong pushback on this kind of thing. "Money laundering" is the "think of the children" of financial regulation. If one could report drug sales as "miscellaneous goods" there would be no reason to go through all of the hoops of washing the money. If all the government cared about was tax evasion, it would allow an amnesty category to report any income one didn't want to specify. Instead, the tax department has been roped into the criminal enforcement department and it makes for ridiculous regulations that shouldn't apply to 90% of the population.

You can report drug dealing as miscellaneous income. The problem is you're not allowed to deduct the costs of doing illegal business, so it's really not practical; you'd have to pay full income tax on the gross.

governments are very motivated to prevent tax evasion

bit of a tangent, but in light of MMT is this even true anymore?

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