Money orders, like checks, can be used to pay bills etc. I'm not sure what you think you would gain by using them instead of a check. Because of the Patriot act, they are scrutinized more than personal checks. So yes, there is an extensive paper trail. If it appears someone is trying to avoid cash reporting guidelines, even if the cash is legit, they can be prosecuted by the Feds.
I would suggest you Google paying bills with money orders and Google money orders and the Patriot act
Anyone have any insights as to what types of risks (if any) are involved with paying one's bills in money orders? I mean, the accounts are attached to one's name so there is always an identity associated even if it's not stamped on the payment. Although the MO also requires the purchaser's signature. I'm thinking about not just things like utilities, but sizeable loans. I want to be able to use my income to pay these off and am getting nervous that too much too soon, even coming from money orders, will raise some kinds of red flags that Im not aware of. I hate not knowing what I don't know... so, any help or advice is welcome.
thanks!
sonja
Money orders, like checks, can be used to pay bills etc. I'm not sure what you think you would gain by using them instead of a check. Because of the Patriot act, they are scrutinized more than personal checks. So yes, there is an extensive paper trail. If it appears someone is trying to avoid cash reporting guidelines, even if the cash is legit, they can be prosecuted by the Feds.
I would suggest you Google paying bills with money orders and Google money orders and the Patriot act
The thing I am trying to avoid is large cash deposits into my bank, obviously. I have never had to show ID to buy a money order; What I am unsure of is whether on the receiving end, mainly my credit card company and my student loans, there is any implication for regularly incoming MO's.
I know how to Google.... I am just hoping a person can talk to me though instead of relying on what I piece together via searches. I would still love for more input, and hopefully without a patronizing tone.
At least according to the department charged with combating financial crimes:
http://www.fincen.gov/financial_institutions/msb/materials/en/prevention_guide.html
Safer to simply deposit the money, declare it as income, and file taxes. Sure, you'll lose ~25% off the top but can then freely move it around the banking system. After all, you DID work for the money so it's the fruit of your labor, and selling time as an escort is likely legal in your jurisdiction - but would verify that first.
Perhaps some of the more squared away ladies can help you through the declaration maze. Maybe with personal mails to keep the discussion from going off the rails
You could of course declare your income, declare business expenses (there are plenty), pay income and FICA taxes on the net income, deposit your own money into your own bank account, put aside some of your money for your retirement, and write checks to pay your expenses. That is the legitimate way to do things.
Yes, yes, I know, who wants to pay taxes when they don't have to. But on the other hand, who wants no retirement account with a lot of money in it growing tax free, and who wants no documented income, which prevents you from ever getting a loan from a bank. Just throwing this thought out there, since nobody else said it.
Thanks! In my case in particular I have a career job with a salary and retirement account so I have been considering the hobby as supplemental income. I can use that legit money for most payments that work better coming from banks so I'm trying to maximize what I can do with each source. I've also gotten some good feedback via PM - thanks all.
just get / keep a reciept.
There are special reporting requirements for deposits of $10,000 or more. The bank has to fill out a form about the deposit that goes to the IRS. It used to be that the standard legal advice was to break your deposits into smaller amounts to avoid this limit. But, there is a new law that is even more draconian. They can now freeze your bank account if they think that you are deliberately trying to avoid reporting the deposits, say with many deposits of smaller amounts. And it is LE, rather than a judge, would decides whether they think you are trying to avoid these limits. This is one of the civil forfeiture laws that has been in the news lately, as LE has frozen the bank accounts of many people who have done nothing illegal or even suspicious. So, it might be safer to make some deposits of more than $10,000.
If you ever get questioned about these deposits, I'd suggest that you don't answer, but then quickly pay taxes on the previously unreported income.