Red flags on bank accounts

So you want information from hard working, tax paying people on how a stripper can avoid paying taxes?

If she is on a student visa I assume she is not legal to work,
so she can not pay taxes.

Ask the bank, they tell you directly. Deposits more than a certain amount would raise alarms. What her friends can do is add her to their account as a second account holder. They don't have to give her money.

I assume you will not be depositing money in her account or adding her name to your account. Right?

Sam

sounds like stripper shit.

Banks report transactions of over $10,000 to the IRS and they report multiple transactions which appear to be structured to keep from being reported to the IRS to the IRS too. The purpose is to catch drug dealers.

What you're describing will set off every red flag in the book. Depositing that much money and then withdrawing it in a short time period would appear to be laundering money and would be investigated by the FBI. Tell her not to do it.

I assume the university is requiring proof of funds because she is a foreign student. That odd fact aside, there are a number of potential problems. First, taxes. Outright gifts are not taxable income, and neither is a loan. But the burden would be on her to prove that the money was indeed a gift or loan. Not too terribly difficult, but if caught up in an audit, it would be a headache. In the end, though, the IRS doesn't really care about the source as long as it is properly reported.

The bigger problem is something called "structuring." There are various currency transaction reporting rules that all financial institutions must follow. You ask if there is a threshold amount above which suspicions would be aroused. The short answer is no. While any deposit 10k and above is subject to reporting, the bank may nonetheless report any suspicious activity. I do now know what standards they might use; the standards might vary bank by bank.

I don't think you're suggesting your friend is doing anything illegal, but there has to be an easier way to do this.

And yes, she is jeopardizing her student visa status by working, even if only occasionally.

Well I'll be damned. I never heard of such of thing. But a quick search does indicate that at some colleges "proof of funding" is required for international students.

From the University of Illinois web page:

"If the student will provide funding from personal funds, a Bank Statement with sufficient funding for at least one year’s total cost is required. Please refer to the PDF of the Declaration and Certification of Finances form for specific expense amounts."

sound like ss to me

See canny's post. Bad bad idea.

@joesparty, outright gifts are taxable income if they're over a certain amount. I believe that the amount is $12,000 a year, although it may have gone up since the last time I checked.

I own a rental property and one of my relatives lives in it and doesn't always pay rent. The months that my relative doesn't pay rent are technically a gift according to the IRS's tax rules. If my rental property was a lot nicer than it is and my relative went a year without paying me rent, they'd be required under law to pay income taxes on the amount of rent which they would have otherwise paid. Since the total yearly rent is under $4,000 neither one of us has to worry about that clause in the tax code.

Ever see a stripper jam $200 in one dollar bills into an ATM machine?

Why not ask the IRS? Or read the IRS website?

I would NOT attempt to FOOL the IRS. Your Dancer friend will find herself in more HOT water than she could imagine.

Besides, that money may well disappear.

Double Thread starting Heh??

See comment in the other thread.

"Her plan is to have some of her friends "park" money in her account just long enough to obtain a statement"

I would be more concerned about her "friends" than the stripper. The (pathetic loser) friends put $35 K in her account, and she flies back to Scamastan and is never seen again.

Transparent scam. If she has "friends" who will be helping her, they're in on it. Once the real marks' money is in the account, the whole thing will be transferred offshore, and she'll be moving on to another city to set it up again.

This chick is from Nigeria, right? lol

All the IRS normally sees is a 1099 listing interest, not balance. And they don't even care about assets, just income. So I wouldn't worry about that. I would worry more about DHS and FBI, which can get not just the 1099 but statements too, and do care about large transfers. But the chances she's on DHS or FBI radar are very slim. She'd have to already be a suspect.

However I will just point out the obvious, this is a scam. I've been to grad school, and I've worked in grad admissions, and I can assure you no reputable school will ask for bank statements to verify ability to pay. They might ask to verify that you're broke and qualify for aid.

Stripper. Going to grad school. Trying to scam "friends" into putting money her account... Hello????

Appreciate the comments from all... I do know for sure this isn't a scam or just SS. But even if it were, none of my money is involved. And the "friends" are just that - other strippers from out of the country (she lives & works where there are lots of foreign girls in the SCs).

The "attempt to fool" here deals not so much with the IRS (at least no more than any other stripper, or waitress for that matter, who does not report all income) but with the school. As Motorhead mentioned, it is most likely b/c she is foreign that they require proof of funds. So she would need to get the cash together to gain admittance to the school, but then would work while going to school to actually pay for it (as I'm sure a lot of us had to do). My hope with this thread (and you guys have given a lot of great info) was just to keep her from doing what she thinks is a good thing (being able to go to grad school) but that would cause her much more grief down the line.

I have to agree with E_Nights. Accepting a bank statement showing enough balance to pay for a year of school as proof of financial ability to pay for an entire year of school is almost as foolish as "parking" money in your stripper friend's account.

Forty years ago when I was in college, we would all drain our checking accounts and go to the County food pantry bearing our "proof" of poverty. We got lots of beans, rice, powdered milk and processed cheese for our efforts.

This requirement also exists with some universities in Canada. Like motorhead I was gobsmacked when I first heard of it. A Venezuelan geophysicist working for me years ago told me of his daughter's problem with this requirement when she enrolled at an Alberta university.

IMO this is very short-sighted thinking on the part of these universities. So many of these bright students remain in North America after graduation and contribute so much more in taxes in a lifetime in our economies than they ever took out of our education systems during their formative years. The cost-benefit calculation is skewed mightily in our society's favour.

As for the scheme proposed in this topic? Pure idiocy.

I kind of think our schools paid by our taxes should be for our citizens. There is to many foreign people in our graduate programs as it is - and there certainly are to many foreign marbles-in-mouth grad teachers for undergraduates. I'll also throw out to many professors at schools are more busy researching and not teaching in an institution set up for... teaching and knowledge distribution.

SHIT !!! Imma going to get a boob job and go to Grad school !!

Canny: a gift is not taxable to the recipient. If it is over $13k, the transferor pays a gift tax, not income tax. So, in your example of allowing a relative to live rent free, it would be you, not the relative, who would pay gift tax.

And, even though a gift tax return is due in each year in which gifts exceed 13k, actual tax isn't during until the lifetime exclusion of $1 million

Oops, accidental post. Anyway, no actual tax is due until the 5 million (not 1 mil) lifetime exclusion is met.

This all illustrates how complicated the matter is.

Using the internet to commit fraud or evade taxes is also a crime.

Anything that involves bank accounts and strippers is automatically a red flag!

This kind of thing is a lot more common than you would imagine among international students. They pay for tuition, fund shopping sprees, casino trips, etc and all the money comes via wire from wherever the parents are. In one day, lost at the tables the next.

The only way this girl would get "caught" is if she's already had probs here and is on someones radar OR if she is from a country the US has bad relations with.

The proposed idea is stupid but don't give the US govt too much credit. 35k for an internationl student to be moving around is routine.

Still think it's a scam. How do you *know* she's a foreign student her on that kind of visa? Her word?