ID and TAX ID Information Required by Linden Labs - Pending Processes Credits On Hold.

[Victoria Lovelace]

I am young if that helps you understand better.

[diane Jules]

Anyone can give an idea how this would affect people who cashout outside of US? I mean im ok if they would tax us, but its just that our country have no firm system on how to tax Ecommerce income or any related method (not that im aware of). If they do tax us would we follow the method they use in US or would they decline approval to us? :matte-motes-crying: (since we dont pay in our country)

 

Its not that I depend my RL on my income here but the 500 USD a month I earn here is still a significant amount, my cash out is placed on hold too; just then did I realise that I missed their email requesting for my info. I replied and they did answer back so I sent the photo iD they requested along with the form and some phone bill statements addressed to me. But they did not reply I hope they are just overwhelmed with all the Tax forms at the moment thats why they dont reply...

 

Sorry if my english is bad...

[Harriet Blaisdale]

After waiting for 10 days for a cash out to process, (it often has taken this long before) i tried to seek some answers. Hidden away i finally found the case ticket and discovered i have to file this form (non us) and provide my photo ID. 

I don't have a problem with this, however my photo ID has not been updated since recently moving home. Does anyone have any experience of how i can deal with this? It shows my old address and i'm pretty certain that i can't update within the 30 days that LL have allowed. I can provide several other documents witht he right address 

 

[Perrie Juran]

---

Harriet Blaisdale wrote:

After waiting for 10 days for a cash out to process, (it often has taken this long before) i tried to seek some answers. Hidden away i finally found the case ticket and discovered i have to file this form (non us) and provide my photo ID. 

I don't have a problem with this, however my photo ID has not been updated since recently moving home. Does anyone have any experience of how i can deal with this? It shows my old address and i'm pretty certain that i can't update within the 30 days that LL have allowed. I can provide several other documents witht he right address 

 

---

You may want to file a support ticket to be certain of an accurate answer.  I do believe copies of official documents such as a utility bill have been acceptable.  But again, I really would ask support to be sure.

[Katz Republic]

I am also having the same issue. The law states this:

 

Residents who have two hundred (200) or more Linden Dollar transactions and the value of such transactions is twenty thousand dollars (US$20,000) or more should receive a 1099-K from Linden Lab. 

BOTH criterias need to be met. Personally, I have yet to make $20,000.

I did resubmit my Drivers License as I have moved since the last time I submitted it.

When pointing out the law as stated, they responded that if I had not been sent a 1099, I was fine and I did not need to submit a W9.

I inquired again about releasing my funds and they told me I HAD to submit a W9. ????

They are contradictating themselves. This is a bit like extortion. Of course I had to give in and submit a W9. 

Because I do not meet the criteria above, I'm not even sure it's legal for them to demand such information. I am VERY unhappy about giving out my SSN. I do not trust the company or it's employees with such personal information and truely feel my rights have been violated.

I understand they must comply with the law, IF the criteria is met. And I'm sure I am not alone in this situation.

So...what's next? Microchipping us?

 

 

[Kouki Elska]

I received this email too... but I have several problems.

 

First, I have no clue what a "Taxpayer ID" or anything of that sort is. Is this something I have to sign up for? Will this cost money to do? If I am an adult 'dependant', do I need parents to do it for me?

 

Second, what if the money I have been sending is going to someone else's paypal? Will they be able to do the identification if they chose to, or does it have to be the one earning the L$?

 

Third, what would happen to someone who is on social security disability welfare?

From what I've been told by the social security people, I am allowed no more than around $300 in my bank account(not sure if online money counts). So, I do not send it to my own bank acconut, I simply send it all to a friend.

I am worried about the legality of signing up my real life info to SL because I do make quite a bit of USD from SL, but by no means is it anywhere near enough to support my living necessities(not even enough for a cheap apartment rent), but because I do it in bulk every few months, it appears to be a hefty amount each time. I also never converted the money through my bank, but it exists online(in a friend's Paypal that I send it to). It is not so much of a worry of losing the welfare, but rather, would they send me to jail or something? Does it count as some kind of fraud to be making a bit of extra money like this, even if it's for someone else?

 

[Tari Landar]

---

Kouki Elska wrote:

Does it count as some kind of fraud to be making a bit of extra money like this, even if it's for someone else?

 

---

Yes, you are making the money, not the "someone else".If you are not using ANY of the money you cash out, and this "someone else" is using it all..they should be the one making it, lol. Regardless, you are the person behind the sl account, so, it's "technically" your income. What you do with it once you cash it out, is your business, you still cashed it out.

You should be reporting all income to the government that you are required to report.  If it is enough income form Sl to change your eligibility for welfare and/or disability benefits..well....you'll have to either suck it up, or stop cashing out. That may be a bit blunt, but it is the truth.  There is no reason for anyone to obtain any type of benefits in a deceitful manner. If you truly do not make enough in sl to change your eligibility status, they will let you know.. If you are making enough in sl to change your status..you haven't much to complain about, that's an income lots of folks would be truly happy to have.

It may be time for you to find a good way that you can benefit more from your sl earnings. If what you make now is not enough to cover basic living, perhaps it can be. If that is what you want to do, of course. I have been there myself, and I can completely understand. If, however, that is not a goal you want to aim for, consider your sl income as a hobby and make certain it is at a level that does not affect your eligibility(your caseworkers, and perhaps the websites associated with your benefits, can tell you what those limits are).

[Perrie Juran]

---

Katz Republic wrote:

I am also having the same issue. The law states this:

 

Residents who have two hundred (200) or more Linden Dollar transactions and the value of such transactions is twenty thousand dollars (US$20,000) or more should receive a 1099-K from Linden Lab.

 

BOTH criterias need to be met. Personally, I have yet to make $20,000.

I did resubmit my Drivers License as I have moved since the last time I submitted it.

When pointing out the law as stated, they responded that if I had not been sent a 1099, I was fine and I did not need to submit a W9.

I inquired again about releasing my funds and they told me I HAD to submit a W9. ????

They are contradictating themselves. This is a bit like 

extortion. Of course I had to give in and submit a W9. 

Because I do not meet the criteria above, I'm not even sure it's legal for them to demand such information. I am VERY unhappy about giving out my SSN. I do not trust the company or it's employees with such personal information and truely feel my rights have been violated.

I understand they must comply with the law, IF the criteria is met. And I'm sure I am not alone in this situation.

So...what's next? Microchipping us?

 

 

---

You are misreading/misunderstanding this.

 

"The Internal Revenue Service (IRS) requires Linden Lab to collect and retain Form W-9 (for U.S. residents) and Form W-8BEN (for non-U.S. residents) at certain transaction volumes. If you reach the transaction threshold and we do not have your completed and signed W-9 or W-8BEN on file, we are required to withhold funds from your account (at the current rate of 28% of your gross amounts received)."

They do not state the specific transaction level that triggers their needing the form(s) but it appears from what other's have posted to be very low.

"Additionally, for U.S. residents with 200 or more transactions with a total amount in excess of $20,000 in a calendar year, we (Linden Lab) are required to file a Form 1099-K with the IRS reporting those transactions for that year."

The 1099 is a form LL has to file AND you get a copy of it also.

http://community.secondlife.com/t5/Commerce/Required-Tax-Documentation/ba-p/2336109

 

DISCLAIMER: I AM NOT A LAWYER

 

[Dresden Ceriano]

You seem to be woefully misinformed.  Firstly, if you're a U.S. citizen, then your Social Security number is your Taxpayer ID, if not, see this page... link.  Secondly, I'm on disability and regularly have more than $300 dollars in my bank account (though, not for very long... it pretty much all goes to bills) and have never had any issues.

Thirdly, not only are you able to earn extra income when on disability, I believe you're actually encouraged to do so... up to a point.  Here's some information about how it works and what the limits are... link.

In closing, no... it's not fraud to earn extra income, but it is fraud not to report it, as you seem to be doing now.  I highly suggest you inform yourself and start conducting yourself accordingly or you may ultimately find yourself in hot water.

...Dres

[Katz Republic]

I see. Yes, you are correct. I never saw this bit.

The Internal Revenue Service (IRS) requires Linden Lab to collect and retain Form W-9 (for U.S. residents) and Form W-8BEN (for non-U.S. residents) at certain transaction volumes.

Thanks for clearing that up. I shall now switch my frame of mind from feeling exploited to I guess I'm a dumg ass :matte-motes-wink-tongue:

[Perrie Juran]

---

Katz Republic wrote:

I see. Yes, you are correct. I never saw this bit.

The Internal Revenue Service (IRS) requires Linden Lab to collect and retain Form W-9 (for U.S. residents) and Form W-8BEN (for non-U.S. residents) at certain transaction volumes.

Thanks for clearing that up. I shall now switch my frame of mind from feeling exploited to I guess I'm a dumg ass :matte-motes-wink-tongue:

---

My Father was a Professor and an Actuary. 

I watched him pull his hair out trying to understand tax laws.

[Deltango Vale]

The new tax reporting requirement is confusing.

I can understand a writer who seeks to publish on Kindle being required to register with the IRS because it is obvious income. He does not deposit funds into Amazon beforehand. He only withdraws funds based on sales. SL is a different thing entirely. Most people bring money into SL then later withdraw some of that money. For 99% of residents, SL is more like a bank account. For 99% of residents, their withdrawals are way below the $10,000 reporting threshold. I do not understand why Linden Lab would subject them to a complex tax reporting requirement.

Surely, LL can distinguish between the 99% of residents who do not make money in SL and the 1% who do. In my opinion, LL is once again shooting itself in the foot by harassing residents with tax reporting forms that are applicable in very few cases. This is particularly true for non-US residents who are, no doubt, baffled by the process. At the very least, it is a huge disincentive for anyone to participate in the SL economy. The message from LL is increasingly clear:

SL = government regulations, social restrictions, transaction fees, red tape and taxes.

[Perrie Juran]

---

Deltango Vale wrote:

The new tax reporting requirement is confusing.

I can understand a writer who seeks to publish on Kindle being required to register with the IRS because it is obvious income. He does not deposit funds into Amazon beforehand. He only withdraws funds based on sales. SL is a different thing entirely. Most people bring money into SL then later withdraw some of that money. For 99% of residents, SL is more like a bank account. For 99% of residents, their withdrawals are way below the $10,000 reporting threshold. I do not understand why Linden Lab would subject them to a complex tax reporting requirement.

Surely, LL can distinguish between the 99% of residents who do not make money in SL and the 1% who do. In my opinion, LL is once again shooting itself in the foot by harassing residents with tax reporting forms that are applicable in very few cases. This is particularly true for non-US residents who are, no doubt, baffled by the process. At the very least, it is a huge disincentive for anyone to participate in the SL economy. The message from LL is increasingly clear:

SL = government regulations, social restrictions, transaction fees, red tape and taxes.

---

I can understand how for someone who does not know English this can seem confusing.

But really it is very simple.

And actually I think a lot of the panic, especially here in the U.S., came from people who hadn't been reporting their income even though they knew they were supposed to. 

There is no harrasment from Linden Lab here.  They are simply doing what the law requires them to do.

If you never cash out you never need to supply the information.

But if you do, they need it before they send you anything.  Because they don't know how much you will eventually cash out, and the same holds true for Amazon.  And at that point they can't have people then saying, "Ha, Ha, you can't find me. Bye Sucker."

[Deltango Vale]

"If you never cash out you never need to supply the information."

--------------------------------------------------------------------------------------

Cute. LL will love you for that one.

Seriously, there is something very wrong with this picture. Either everone should be required to register with the IRS (as is done with US bank accounts) or only people who generate an income via SL (as is done with Amazon). Linden Lab's policy appears arbitrary and inconsistent. It is also grossly unfair to those who deposited money in SL before the new policy was announced.

[Perrie Juran]

---

Deltango Vale wrote:

"

If you never cash out you never need to supply the information."

--------------------------------------------------------------------------------------

Cute. LL will love you for that one.

 

---

Well, that's quite obvious.  The policy states it's for people who cash out. 

 

---

Deltango Vale wrote:

 

Seriously, there is something very wrong with this picture. Either everone should be required to register with the IRS (as is done with US bank accounts) or only people who generate an income via SL (as is done with Amazon).

---

Do you realize you are contradicting yourself in this statement?  Unless I'm completely misunderstanding what you are saying.

I only buy on Amazon.   I've never sold there and doubt if I ever will.  So I've never had to supply my tax info.  Same with SL. 

The only people being required to provide the information are those who cash out (have an income).  So I don't understand your problem here. 

 

---

Deltango Vale wrote:

"

Linden Lab's policy appears arbitrary and inconsistent.

---

What is arbitrary or inconsistent?  The policy brings LL in compliance with U.S. Law.  As I said, I can understand how someone who does not have English as a first language having trouble understanding it. But it is really very simple.

If you cash out LL needs to verify who you are. 

The IRS has a Form for U.S. Citizens (W-9) and a different form for Citizens of other Nations (W8-EBN). 

Because it is a Federal Crime to provide false information with these forms it is assumed the information you supply is accurate.  For Non U.S. citizens it's assumed they provide accurate information because tax evasion will be a crime in their own Countries.

For U.S citizens who cash out, if you exceed a certain amount of money, the IRS requires that LL reports it to them. 

 

---

Deltango Vale wrote:

I

t is also grossly unfair to those who deposited money in SL before the new policy was announced.

---

How is it grossly unfair?  Laws can change at any time and when they change LL has to comply with them. 

Additionally, LL removed the ability to deposit money into your SL account quite a while back.  Yes, people who had money in their accounts have got caught by this if they want to take the money back out.  But LL has to comply with the law. 

If there is anything unfair here it's the tax laws. 

Your comments read more like you are trying to create problems where none exist.

 

[Deltango Vale]

"The only people being required to provide the information are those who cash out (have an income). So I don't understand your problem here."

--------------------------------------------------------------------------------

Cashing out does not equal income. If I deposit $5,000 into a bank account then later withdraw $2,000, the $2,000 is not income. Very few residents generate an income in SL. Most treat SL as a hobby or entertainment expense. Most simply wish to withdraw some of the money they had previously deposited.

--------------------------------------------------------------------------------

"Additionally, LL removed the ability to deposit money into your SL account quite a while back."

--------------------------------------------------------------------------------

Almost anyone can deposit money into SL. For example, I can bring $10,000 into SL per month, $120,000 per year, if I so desire.

--------------------------------------------------------------------------------

"What is arbitrary or inconsistent?"

--------------------------------------------------------------------------------

Anyone wishing to open a bank account in the US is required by law to supply ID and tax information. If SL is a type of bank account then every resident depositing money into SL should be required by law  to provide ID and tax information. Yet LL chooses not to treat SL as a type of bank account, which I presume LL is legally entitled to do, thought it raises interesting questions about the legal/tax status of virtual bank accounts. Be that as it may, SL accounts are, functionally, a type of bank account (deposit/withdraw, $L convertible with $US).

The situation regarding Amazon Kindle is straightforward. No one deposits money into Amazon before publishing his book. Money withdrawn can only be income. The ID and tax information required to publish on Kindle therefore apply to all accounts for obvious reasons. There is no confusion. Nothing is arbitrary.

SL is not so straightforward. SL is a mixture of pay-to-play hobby/entertainment (often requiring money to be deposited in advance to buy, for example, land or a large wardrobe) and business (sometimes profitable, often loss-making). Currently, LL does not distinguish between those who withdraw profits from their investments and those who withdraw from previously deposited funds. LL treats the person who withdraws $2,000 from the $5,000 he previously deposited as if the $2,000 were income. This generates massive confusion among the residents. I, for example, have deposited about $20,000 into SL over the previous eight years, generating about $15,000 in losses (pay-to-play expenses). Now I wish to withdraw a couple thousand dollars of what remains. To call my withdrawal 'income' is ridiculous.

In addition, many residents who don't come anywhere near LL's stated threshold of 200 withdrawals and/or a withdrawal of $20,000 are being asked to provide ID and tax information. This too generates massive confusion.

To be consistent, LL should either treat SL accounts as bank accounts (and require all residents to supply ID and tax information) or request ID and tax information only on profit-making individuals/businesses and/or explain to residents clearly, in advance, the precise thresholds that would trigger a request for ID and tax information. At the moment, as expressed in many blogs, the situation appears arbitrary, inconsistent and confusing. This is not the fault of the IRS. This is the fault of Linden Lab again being sloppy in the application of law and policy.

[Theresa Tennyson]

---

Deltango Vale wrote:

"The only people being required to provide the information are those who cash out (have an income). So I don't understand your problem here."

--------------------------------------------------------------------------------

Cashing out 

does not

 equal income. If I deposit $5,000 into a bank account then later withdraw $2,000, the $2,000 is not income. Very few residents generate an income in SL. Most treat SL as a hobby or entertainment expense. Most simply wish to withdraw some of the money they had previously deposited.

---

If you deposit money into a bank and then withdraw it, the money never changes from "money" to "something else." If you're considering buying a region or paying tier to be your "deposit" then the money is changed from "money" to "imaginary island", and then if you then cash out Lindens that your imaginary island brought in it's changed to "money" again and it's money that you most assuredly didn't have before - you couldn't pay real-world debts with your imaginary island.

If you buy a taxicab for $20000 and you only make $5000 in fares, that $5000 is still taxable income even though its less than your expenses. . The cost of the taxicab is probably deductable as an expense, but that's between you and the tax man.

[Perrie Juran]

---

Deltango Vale wrote:

"The only people being required to provide the information are those who cash out (have an income). So I don't understand your problem here."

--------------------------------------------------------------------------------

Cashing out 

does not

 equal income. If I deposit $5,000 into a bank account then later withdraw $2,000, the $2,000 is not income. Very few residents generate an income in SL. Most treat SL as a hobby or entertainment expense. Most simply wish to withdraw some of the money they had previously deposited.

--------------------------------------------------------------------------------

"Additionally, LL removed the ability to deposit money into your SL account quite a while back."

--------------------------------------------------------------------------------

Almost anyone can deposit money into SL. For example, I can bring $10,000 into SL per month, $120,000 per year, if I so desire.

--------------------------------------------------------------------------------

"What is arbitrary or inconsistent?"

--------------------------------------------------------------------------------

Anyone wishing to open a bank account in the US is required by law to supply ID and tax information. If SL is a type of bank account then every resident depositing money into SL should be required by law  to provide ID and tax information. Yet LL chooses not to treat SL as a type of bank account, which I presume LL is legally entitled to do, thought it raises interesting questions about the legal/tax status of virtual bank accounts. Be that as it may, SL accounts are, functionally, a type of bank account (deposit/withdraw, $L convertible with $US).

The situation regarding Amazon Kindle is straightforward. No one deposits money into Amazon before publishing his book. Money withdrawn 

can only

 be income. The ID and tax information required to publish on Kindle therefore apply to 

all

 accounts for obvious reasons. There is no confusion. Nothing is arbitrary.

SL is not so straightforward. SL is a mixture of pay-to-play hobby/entertainment (often requiring money to be deposited in advance to buy, for example, land or a large wardrobe) and business (sometimes profitable, often loss-making). Currently, LL does not distinguish between those who withdraw profits from their investments and those who withdraw from previously deposited funds. LL treats the person who withdraws $2,000 from the $5,000 he previously deposited 

as if

 the $2,000 were income. This generates massive confusion among the residents. I, for example, have deposited about $20,000 into SL over the previous eight years, generating about $15,000 in losses (pay-to-play expenses). Now I wish to withdraw a couple thousand dollars of what remains. To call my withdrawal 'income' is ridiculous.

In addition, many residents who don't come anywhere near LL's stated threshold of 200 withdrawals and/or a withdrawal of $20,000 are being asked to provide ID and tax information. This too generates massive confusion.

To be consistent, LL should either treat SL accounts as bank accounts (and require all residents to supply ID and tax information) 

or

 request ID and tax information 

only

 on profit-making individuals/businesses 

and/or

 explain to residents clearly, in advance, the 

precise thresholds

 that would trigger a request for ID and tax information. At the moment, as expressed in many blogs, the situation appears arbitrary, inconsistent and confusing. This is not the fault of the IRS. This is the fault of Linden Lab again being sloppy in the application of law and policy.

---

Again, you can no longer deposit cash into Second Life.  When you purchase Linden Dollars now it is a real time transaction.  Which is one of the reasons LL requires a verified form of payment.  (The breakdowns in this are the fault of the banks but that is a separate side discussion.  That is not the fault of Linden Lab).

Now why someone would want to store their money in SL would be beyond me.  You incure a charge for buying $L.  You incure a charge for selling $L. It results in a net loss.  The way the Lindex is set up, to the best of my ability to calculate the numbers, it is not possible to make a profit by simply buying and selling on the Lindex.  The end result will always be a loss. 

Which brings me to this.  The Lindex is NOT meant as a place for people to store Cash.  So why should it be Linden Lab's responsibilty to figure out who is actually a Merchant and who isn't when it comes to cashing out?

Lastly, every post I've read when someone has stated confusion as to why and when LL requires a W-9 or the  W8-EBN has come from people not reading what is written.  It's always been I don't sell $10,000, etc, so I don't know why they need it.  Linden Lab never said that.  All they said is that they are required to report that to the IRS.

What they did say is that when you cash out a certain (what is really a very small) amount we are going to ask you for your tax ID.  Yes, They don't state what that amount is.  And really, probably rightfully so.  Because if people knew the trigger they would try to game the system. This would add to the complexity of the Fraud control Linden Lab is already required to maintain.

So again there is nothing arbitrary here.

Like I said, I can understand someone who doesn't have good English skills needing help understanding what is going on.  And I certainly don't disparage them.  But for people who do have good English skills, the problems they seem to have understanding this are really figments of their imaginations.  They are simply failing to read what is written.

On a final note, I don't like this any better than anyone else.  I dislike any Government intrusion into my personal life.  Period.  It's up to me to raise hell with my own Government when I don't like something which is something that I do.

[Deltango Vale]

"Again, you can no longer deposit cash into Second Life."

-------------------------------------------------------------------------------

I can purchase US$5,000 worth of L$ in a 24-hour period to a maximum of US$10,000 every 30 days. I have been able to do this since 2006 (45 days after joining SL). If you choose not to believe me, well, I guess it puts an end to the conversation. I certainly gain nothing by lying.

[Deltango Vale]

Back in 2006-2007 when Second Life had a bright and promising future, I and thousands of others from around the world poured money into SL. A mainland sim could cost up to US$5,000 at auction. People bought land and built homes. Some opened businesses. When SL began to go south in 2008-2009, much of that money was withdrawn, a process that continues to this day. Others gritted their teeth and prayed for better LL management or a corporate buyout. Yes, we holdouts were stupid. I confess to being blinded by hope. The smart money read the writing on the wall and cleared out. Desmond Shang said he would have left long ago except for his commitment to his friends and tenants - and, boy, is he pissed off by the way LL has dealt with him recently. (Note: for those who don't know him, Desmond is one of the most sober and upright people I have ever met. From day one, he has run his business professionally, paying every cent of his taxes.)

----------------------------------------------------------------------

"Now why someone would want to store their money in SL would be beyond me."

----------------------------------------------------------------------

People didn't sit down with a pencil in one hand and a phone call to PWC in the other, trying to figure out how to store money in SL. People came to SL with dreams. They paid for their dreams with money. Land cost money, homes cost money, clothes cost money. Second Life is not some computer game to be played during lunch hour; SL is an immersive virtual world in which people live full, rich and complete lives. It is because of this that so many people were reluctant to sell off their land, derez their homes and pull out of SL. Is it any wonder that they are infuriated by LL asking them for ID and tax info on the way out?

----------------------------------------------------------------------

"The Internal Revenue Service (IRS) requires Linden Lab to collect and retain Form W-9 (for U.S. residents) and Form W-8BEN (for non-U.S. residents) at certain transaction volumes. If you reach the transaction threshold and we do not have your completed and signed W-9 or W-8BEN on file, we are required to withhold funds from your account (at the current rate of 28% of your gross amounts received). Additionally, for U.S. residents with 200 or more transactions with a total amount in excess of $20,000 in a calendar year, we are required to file a Form 1099-K with the IRS reporting those transactions for that year." - Linden Lab

----------------------------------------------------------------------

You are right that Linden Lab never states clearly what the threshold might be, though the implication is the 200 transaction/$20,000 mark, but are you seriously suggesting that laws should be vague or secret to avoid people gaming the system? I can't think of a single lawyer who would agree with you.

[irihapeti]

something that sometimes get missed is that LL (same as every other US company) is required by US law to not only know who they give money to (cash out) but to also know who it is in the RL gives them money (buyin L$)

so even if someone never cashes out but still makes buyins that trigger the threshold then the account hold mechanism kicks in

seems to me that the threshold depends on the account holder. For example if LL know exactly who you are in RL (full disclosure of ident tax, etc) and have substantial dealings with you then the trigger threshold will be a lot higher

It will still trigger tho at some point no matter how well-known you are. Account protection and that

+

my bank works the same way. Like if $20,000 was deposit in my bank account then my bank will put my account on hold. bc I never ever had anyone give me $20,000 before ever

they want to know who put the money in. If I have no idea then the bank worries about that on my behalf

like they go hmmm! We put on hold. And then I ring up and go waaaah! and they go who what gave you that money? And I go umm! dunno!  and I go give it back to whoever send it bc is not mine. And they go ok and is all good

[Theresa Tennyson]

---

Deltango Vale wrote:

"

Again, you can no longer deposit cash into Second Life.

"

-------------------------------------------------------------------------------

I can purchase US$5,000 worth of L$ in a 24-hour period to a maximum of US$10,000 every 30 days. I have been able to do this since 2006 (45 days after joining SL). If you choose not to believe me, well, I guess it puts an end to the conversation. I certainly gain nothing by lying.

---

You can buy $5,000 worth of macaroni every day too but it doesn't mean that your pasta stash has value as a financial instrument. If your neighbor opens a day-care center and you start selling it to them as art supplies? The money you get for it then has value as a financial instrument and is taxable.

[Perrie Juran]

---

Deltango Vale wrote:

"

Again, you can no longer deposit cash into Second Life.

"

-------------------------------------------------------------------------------

I can purchase US$5,000 worth of L$ in a 24-hour period to a maximum of US$10,000 every 30 days. I have been able to do this since 2006 (45 days after joining SL). If you choose not to believe me, well, I guess it puts an end to the conversation. I certainly gain nothing by lying.

---

Buying US$5,000 worth of L$ is not the same as "depositing cash."

We used to be able to "add (deposit) cash" (Real Dollars) and just let it sit there.  I'm referring to adding Real Dollars to your account.  People used to do this to make sure their Tier was covered. (There was a Thread about this that I can't find right now).

Buying any amount of Linden Dollars is not quite the same as "depositing money."

Usually when someone Buys $L it is with the intent of using them.  Not with the intent of storing (banking) their money so they can later withdraw it. 

So yes, someone could buy $L and change their mind and decide they need cash back.  They'd then have to sell the $L first, etc.  But that is not usually why people buy $L.

I think we are just having a little bit of a language problem here on this point, not understanding each other.  I hope this clears it up.

[Perrie Juran]

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Deltango Vale wrote:

Back in 2006-2007 when Second Life had a bright and promising future, I and thousands of others from around the world poured money into SL. A mainland sim could cost up to US$5,000 at auction. People bought land and built homes. Some opened businesses. When SL began to go south in 2008-2009, much of that money was withdrawn, a process that continues to this day. Others gritted their teeth and prayed for better LL management or a corporate buyout. Yes, we holdouts were stupid. I confess to being blinded by hope. The smart money read the writing on the wall and cleared out. Desmond Shang said he would have left long ago except for his commitment to his friends and tenants - and, boy, is he pissed off by the way LL has dealt with him recently. (Note: for those who don't know him, Desmond is one of the most sober and upright people I have ever met. From day one, he has run his business professionally, paying every cent of his taxes.)

 

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I'll agree with you that many people came here with dreams and the dreams failed.  Some of the failures I'll agree were caused either directly or indirectly by things Linden Lab did with the land market.  But not all failures were caused by things Linden Lab did.

 

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Deltango Vale wrote:

 

"Now why someone would want to store their money in SL would be beyond me."

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People didn't sit down with a pencil in one hand and a phone call to PWC in the other, trying to figure out how to store money in SL. People came to SL with dreams. They paid for their dreams with money. Land cost money, homes cost money, clothes cost money. Second Life is not some computer game to be played during lunch hour; SL is an immersive virtual world in which people live full, rich and complete lives. It is because of this that so many people were reluctant to sell off their land, derez their homes and pull out of SL. Is it any wonder that they are infuriated by LL asking them for ID and tax info on the way out?

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I understand that people would not be happy.  But asking LL to decipher who was in it for profit (business) and who was in it only for "fun" might possibly be a very big mess.  I had two parcels of land, one of which I rented to a friend.  I sold the rented parcel and now have a surpluss of $L.  I will eventually use them so I am not cashing out.  But for LL to track all this to decide whether I was in business or not would be a little wild. 

Also the Gov't does not ask LL to figure this out for them.

 

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Deltango Vale wrote:

 

"The Internal Revenue Service (IRS) requires Linden Lab to collect and retain Form W-9 (for U.S. residents) and Form W-8BEN (for non-U.S. residents) at certain transaction volumes. If you reach the transaction threshold and we do not have your completed and signed W-9 or W-8BEN on file, we are required to withhold funds from your account (at the current rate of 28% of your gross amounts received). Additionally, for U.S. residents with 200 or more transactions with a total amount in excess of $20,000 in a calendar year, we are required to file a Form 1099-K with the IRS reporting those transactions for that year." - Linden Lab

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You are right that Linden Lab never states clearly what the threshold might be, though the implication is the 200 transaction/$20,000 mark, but are you seriously suggesting that laws should be vague or secret to avoid people gaming the system? I can't think of a single lawyer who would agree with you.

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Another reason for using the word "certain" is because the IRS can change it.  If someone really wants to know the current triggers they can look it up on the IRS web site.  (Actually it's a little confusing even there.  Though I didn't spend a lot of time looking).

Perhaps if they had moved the last sentence, "Additionally, for U.S. residents ,etc," to a new paragraph there would have been less confusion, but really it is quite clear.  There is no implication.  People just keep reading into it.

Last of all, if someone is honest with their taxes, then what is the worry?  A lot of the complaints we have read I think came from people who weren't being honest with them.  Which is why the IRS instituted the rules.  Linden Lab did not institute them.  The IRS did.  Linden Lab is simply doing their best to comply. 

 

 

 

[Deltango Vale]

"I think we are just having a little bit of a language problem here on this point, not understanding each other. I hope this clears it up."

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Semantics: the biggest problem for communication.

I am also able to "Increase Credit". This is how I bring $US into my SL account. It's standard procedure. I have been doing it for eight years without a problem.

Perhaps there is a generational issue here. Today, SL is all about free free free - about 'playing' SL without spending any money. This is due to LL's promotion of a free-to-play culture, the company's attempts over the years to convert SL into 3D Facebook, avatar Minecraft and cellphone Candy Crush, and the exodus of money by people of my generation who became disillusioned by the direction of SL and the compound errors of LL management. The cynicism toward SL/LL and the disparaging of virtual everything as expressed so often in the fora is a symptom of these changes.

I must admit that if I had discovered SL today (as it is today) instead of 2006 (as it was in 2006), I would not invest a single cent. SL today is a sad and restrictive world, a kind of mini-California + Disneyland theme park. No one in 2006 imagined such a terrible future for SL.