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Long Term Benefits Of TAX & ID Evidence Submission from LL


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Linden Labs have started putting pending process credits (Money withdrawals) on hold until people complete the appropriate TAX documentation as well as provide evidence of their address and include a scan of some photo ID such as a passport or a driving license etc.

I have had to do all this as have others here in the forums.

There is estimated only about 5% of SL users visit the forums and even less who post in them so it's hard to calculate how many people have already had this information based on these forums alone.

There is some speculation as to whether ALL people who cash out will be required to provide this ID information.

I believe; Yes. They will.

I think this because as I have said in other threads, what LL are doing is not unique to LL.

Its actually a very normal and typical requirement for anyone that tries to set up a seller account on e-commerce websites that sell digital content such as renderosity.com or any website whose website is registered address is in the USA and who allow third parties (merchants) to sell through their platform.

I have completed 4 of these TAX forms when I went to start selling on contentparadise.com, turbosquid.com etc.

In fact, they would not even allow me to start publishing until they got the forms from me as it is a requirement by law for any USA e-commerce website to ensure they have collected this data to avoid people making money and not paying due TAX

However I doubt LL will be doing this process all in one go. I would imagine they will do it in batches to avoid being overwhelmed with support tickets.

But I DO believe that anyone who cashes out more than $600.00 a year will have to do the same or they will have their US Dollar credits put on hold.

There is a possibility that LL may deduct 30% if you do not submit your ID and TAX information as this is what turbosquid.com does. They take 30% of your US Dollar credit and withhold it for the US Tax Dept.

Beyond this,  I think this is brilliant.

Think about how this will effect theft in SL copybot and people who create false accounts with the sole intention to scam and rip people off.

There is no incentive now because they are not going to prove who they are in RL and so they can't get their hands on the cold hard cash.

This will be a positive thing long term for honest business people who aren't dodging the TAX man or trying to make a quick buck from stolen digital goods, something that SL has had a major issue with since it first allowed people to sell goods and convert L$ to US dollar.

 

 

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Pretty sure it's going to be difficult to take someones financial theories seriously when they refer to the Service Operator as Linden Labs. And doesn't know the difference between effect and affectI also don't think you understand what Copybot is/was.

'Anybody can create, anybody can sell', is a central tenet of Second Life. Mesh distorted this a little (with a higher bar to entry), but I'm fairly sure there's no way LL would ever make it compulsory to confirm RL identity prior to gaining seller/merchant status. Note that obviously, any user can set one of their own prims for sale in-world - this won't change.

Don't think there's any evidence they'll ever do any more in this area than the law requires. Your experience in other areas is great, but Linden Lab don't operate on the same level of any of the companies you mentioned.

Lastly, no, it wouldn't be good for Second Life. Mesh piracy sucks, but the loss of free-flowing creativity would suck more. Your asserted criminalisation of NPIOF users as either content thieves or tax-dodgers is offered completely without evidence or thought. Not everyone is like you.

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Freya Mokusei wrote:

Pretty sure it's going to be difficult to take someones financial theories seriously when they refer to the Service Operator as
Linden Labs
. And don't know the difference between
effect
and
affect
I also don't think you understand what Copybot is/was.

'Anybody can create, anybody can sell', is a central tenet of Second Life. Mesh distorted this a little (with a higher bar to entry), but I'm fairly sure there's no way LL would ever make it compulsory to confirm RL identity prior to gaining seller/merchant status. Note that obviously, any user can set one of their own prims for sale in-world - this won't change.

Don't think there's any evidence they'll ever do any more in this area than the law requires.
Your experience in other areas is great, but Linden Lab don't operate on the same level of any of the companies you mentioned.

Lastly, no, it wouldn't be good for Second Life. Mesh piracy sucks, but the loss of free-flowing creativity would suck more. Your asserted criminalisation of NPIOF users as either content theives or tax-dodgers is offered completely without evidence or thought. Suggest you conduct more research.

What LilyBeth proposed won't do anything to stop free-flowing creativity, just free-flowing money. You could still create and sell anything you like without ID on file just as long as you don't convert the proceeds to RL cash.

Oh, and if you're going to play the grammar card? It's "thieves", not "theives." I'm just sayin'...

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Freya Mokusei wrote:

Pretty sure it's going to be difficult to take someones financial theories seriously when they refer to the Service Operator as
Linden Labs
. A
nd don't know the difference between
effect
and
affect
I also don't think you understand what Copybot is/was.

'Anybody can create, anybody can sell', is a central tenet of Second Life. Mesh distorted this a little (with a higher bar to entry), but I'm fairly sure there's no way LL would ever make it compulsory to confirm RL identity prior to gaining seller/merchant status. Note that obviously, any user can set one of their own prims for sale in-world - this won't change.

Don't think there's any evidence they'll ever do any more in this area than the law requires.
Your experience in other areas is great, but Linden Lab
don't
operate on the same level of any of the companies you mentioned.

Lastly, no, it wouldn't be good for Second Life. Mesh piracy sucks, but the loss of free-flowing creativity would suck more. Your asserted criminalisation of NPIOF users as either content theives or tax-dodgers is offered completely without evidence or thought. Suggest you conduct more research.

Coming from the user who doesn't know how to use "Don't".

 

Anyhow, I'd have to disagree with you Freya. Almost all of what LillyBeth says is pretty accurate. Copybotters just copy and sell prims, not much to it. If they can still copy, but can't sell without confirming their ID's and filing Taxes then there will be less of them, and more chance of the ones who DO confirm their ID's getting in RL trouble.

 

Anyone can create, and anyone can sell. This only puts a block on users who wish to withdraw the money from second life. You can create for free, you can sell for free as well, but you can NOT withdraw your money from SL without filing taxes, so you better have your eyes on a nice pair of shoes!

I think you're not giving Linden Lab enough credit. If your knowledge only expands to secondlife then you're missing out on a lot of what they're doing, They manage a ton of different projects (My personal favorite project is Desura..would like to see where that heads in the future), and still offer everyone a free environment.

Free flowing creation isn't being lost, and its actually encouraging more of it. People may no longer rush projects, or do a half-booty job of creating because the faster they get it out the faster they make money. If they won't provide ID and TAX info then there is no more money for them, only creation. Only fun, Only FREE FLOWING CREATIVITY!~

 

Most games you have to register with your RL info before you play, and buy it with a credit card or paypal (information! oh no!) but can't earn money off of them. So just like every other profit oriented website that doesn't steal 30% off the top for taxes, yes you need information. People are too bitter about it, but it isn't like you have much to lose. Think how easy your data is to access already, the government has it, hundreds of websites already host it. Just register it, and stop whining because you have to pay taxes.

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Theresa Tennyson wrote:

Oh, and if you're going to play the grammar card? It's "thieves", not "theives." I'm just sayin'...


Actually I was playing the 'Suggestions Without Having a Clue' card. There's an important difference between failures of understanding and typos (luckily for my pride, I can see the difference). :) My post has been updated.

Money and creativity are connected, that is basically the underpinning of Philip's original vision.

 

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MIstahMoose wrote:

Coming from the user who doesn't know how to use "Don't".


Kekeke, granted, that one was clumsy. If you're genuinely inferring that I don't understand how to use that word then you're mistaken. :) I was typing at speed (in fact I was editing my post for maybe the dozenth time), and I'm not presenting any new ideas in my post.

The rest of your post is below the bar of my interest in this topic. LL has a methodology already, my post was to point out that I can't imagine their position will change unless the law forces it to change. Copybot is a scripted process, and on the fundamental level has nothing to do with IP infringement. I don't care about tax or the validity of Intellectual Property as a concept (beyond the knowledge that I don't abuse either) and I'm perfectly aware SL used to be limited only to those who would relinquish RL information (in fact, that's one of the best reasons that the 'Pay2Play' requirement will never return). I'm not going to argue between uninformed opinions of whether or not MaryBeth's suggestions would be workable/awesome/the-end-of-Second-Life-as-we-know-it, because that's boring, sorry.

"Everyone can get your information already" is provably untrue and a ridiculous argument.

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My bad too, I forgot that everyone presenting the first thing that came to their heads as an over-generalised cultural benefit to the whole grid was a delicate flower. Identification of game-token exporters is probably great for LL - it must be so hard giving real money to people trying to take it out of their hands, and I doubt they'll mind making it even more difficult for their users. Would authentication be a net gain for users? I'd say that's definitely more disputable, and it's the only claim that you make. I find it unlikely that mesh ripping is so common simply because it's profitable in RL (is it? I don't think I've seen that episode of Rags to Riches)  - it's also market driven (because someone shops for these ripped items), and this market won't diminish no matter how many hoops LL makes people jump through (IP theft happened before mesh helped it).

Mock-offence is great. Certainly means you don't need to address any critical responses.

Come to think of it though, I'd be completely happy if my spelling corrections were the only things that stuck from you reading my posts (even if they were a pretty minor point, since I only referenced them as evidence). :)

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Freya Mokusei wrote:


Theresa Tennyson wrote:

Oh, and if you're going to play the grammar card? It's "thieves", not "theives." I'm just sayin'...


Actually I was playing the 'Suggestions without Having a Clue' card. There's an important difference between failures of understanding and typos (luckily for my pride, I can see the difference).
:)
My post has been updated.

Money and creativity are connected, that is basically the underpinning of Philip's original vision.

 

Now, this is hilarious.

No one has actually played the grammar card, since no one has actually criticized anyone's grammar.  Spelling and grammar are two completely distinct things.  Nevertheless, typos are indeed errors in spelling (regardless of how that affects anyone's pride) and, though they certainly can, misspellings do not usually lead to failures of understanding.  Even mistakenly spelling affect effect still gets the intended point across just as much as does spelling thieves theives.  Next, you'll be discrediting the actual content of posts for something as simple as a misplace comma, which would fall under the category of punctuation and is also distinct from both spelling and grammar.

Maybe next time either of you decide to criticize someone for the way they've written something, rather than what they've written, you'll be a bit more careful to do so correctly or perhaps just not go there in the first place.

...Dres

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Freya Mokusei wrote:


Theresa Tennyson wrote:

Oh, and if you're going to play the grammar card? It's "thieves", not "theives." I'm just sayin'...


Actually I was playing the 'Suggestions Without Having a Clue' card. There's an important difference between failures of understanding and typos (luckily for my pride, I can see the difference).
:)
My post has been updated.

Money and creativity are connected, that is basically the underpinning of Philip's original vision.

 

Actually Philip's original vision was a combat simulation where people terraformed the ground by throwing little grenades. The financial system didn't come about later. And in any event the point is moot, because Linden Lab has evolved to the point where they transfer enough real-world cash that they can be considered not only a bank, but an international bank.

Now imagine a bank examiner coming to a financial institution and saying, "So, you've been sending money to this account in Russia. Pretty consistently - a few hundred dollars here, a few hundred dollars there. Just who is this money going to?"

And now imagine this institution replying, "Oh, that's zomba6 Clothesline - he's a giant blue rabbit. He's nice - maybe has a few problems relating to people, but hey, who doesn't? He's from Russia? Kewl."

Just how long do you think an institution like this would be allowed to stay in business?

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I dunno why posters got so snippy about it. I used it as evidence in my dismissal - just as I wouldn't invest in some get-rich-quick scheme that was advertised as "Get free money 4 working from home, Instant affect!" - it was only one part of my reaction of 'Nope, this is silly.'

I realise that it's a 'cheap shot', which is why I had other reasons, too. :P

The intention behind someones typing is a perfectly fine way to assess ability and insight . Communication is more important than sticking to 'the rules' of English, sure, but it's also (at least here, in this forum) one of the best ways for a poster to be taken seriously. I'm happy to stand by my mistakes because I'm not suggesting anyone accept my reasoning without other evidence - in this case, my central point was that using past as precident, LL would never react in this way.

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Theresa Tennyson wrote:

Just how long do you think an institution like this would be allowed to stay in business?


I don't know? PayPal's been around a while, but banking isn't my game. I'm not pretending to know any of that stuff.

That's the core of the argument, right? Since if LL couldn't pay out to PayPal, they'd have to do it via bank payment (i.e., the 'old' way) - there'd be no other choice but to hand over RL banking information (at least, enough information to please US authorities?). But if that was the case the IRS would be chasing PayPal instead.

I don't understand the US tax system (nor do I need to), but in theory the only thing you need to make an acceptable payment overseas is RL banking info (isn't it disingenuous to present the argument as 'he's a blue rabbit', if you have his RL banking info?). It's a definite leap to suggest either US tax rules or RL banking information would reduce the incidence of L$-based fraud or IP infringement (which is what the OP was claiming).

At best, these rules might have local effects inside the US and EU, affecting users there. The 'annoyance factor' might deter a couple of cheapskates, sure. I don't see any reason why it would inspire any extra confidence in the SL market as a whole.

I do know that I don't understand the technicalities of this issue - or maybe I'm just looking at this backwards. Since MaryBeth is too hurt by my scathing criticism of her typing ability to come up with any answers, I'll research this later.

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Actually I agree with your premise. It won't stop copybotters completely but should help a great deal.

I am also betting the IRS and/or Homeland Security is after LL for them to all the sudden do this when its always been a requirement.  So the chance they'll now look the other way and just allow LL to slip back into their old ways is pretty slim.

 

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Freya Mokusei wrote:

I realise that it's a 'cheap shot', which is why I had other reasons, too.
:P

Once you start off a post with a cheap shot, do you really expect for the rest of what you've written within that post to be taken seriously?  Your words would have been much more effective had you not resorted to that, no matter how they were spelled.

...Dres

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Duely noted.

Economic/cultural arguments are difficult, especially when entirely speculative. I opted to place the most obvious criticism at the beginning. I think it's a true enough statement that spelling choices (as intention) will affect the way posts are evaluated - just as the same is true of cheap shots. :P

I'll bear this in mind next time around.

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Waves :) Sorry to hear all this, cashing out is a game changer. It was for me, so it is sad to see this all over again. The effects are things you may not expect. I understand Lilly that you really want to see the good of all this, we all want the good.

Many people just aren't able to provide the needed documents. Many may just not want to. Each person being different, probably each with there own reasons. Others will breeze through it all and keep making things.

Our community, the SL we all know from 2006 or before and since, we know how things have come along, we haven't forgotten. We came here to build the world all new, and it was fun. After a while we got so good, we started making some real money. Just from our time spent in world, sharing ideas. Few took selling and marketing as serious as it is now.

This is yet another move that will narrow the field. Less creators cashing out, so more money will stay in world, as mine has. I have become something no one should ever want to be, a Lindenaire$. For me, its all play money now. 

 

 

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Zag Magic wrote:

Waves
:)
 Sorry to hear all this, cashing out is a game changer. It was for me, so it is sad to see this all over again. The effects are things you may not expect. I understand Lilly that you really want to see the good of all this, we all want the good.

Many people just aren't able to provide the needed documents. Many may just not want to. Each person being different, probably each with there own reasons. Others will breeze through it all and keep making things.

Our community, the SL we all know from 2006 or before and since, we know how things have come along, we haven't forgotten. We came here to build the world all new, and it was fun. After a while we got so good, we started making some real money. Just from our time spent in world, sharing ideas. Few took selling and marketing as serious as it is now.

This is yet another move that will narrow the field. Less creators cashing out, so more money will stay in world, as mine has. I have become something no one should ever want to be, a Lindenaire$. For me, its all play money now. 

 

 

 

This is maybe the first post that makes it clear to me what some of the resistance is all about, and I sympathize with you a great deal. The thing is, selling and marketing always WAS serious even if it wasn't taken that way at first.

LillyBeth is exactly right about the requirements. If you make US dollars in the US, the government wants a share. Doesn't matter if you're mowing lawns in the neighborhood: you make money, it's taxable.

There are legal maximums and minimums (a certain amount of income can avoid taxes) and there are practical maximums and minimums. The IRS isn't going to follow your little brother around the neighborhood to see how much he's raking in for raking the leaves. Even if he gets a pickup truck when he's 16 and puts signs on the doors and starts going farther afield the IRS probably isn't going to pay much attention. But if he's making enough money to have a taxable income and he doesn't report it, he's breaking the law.

What the US tax rules are regarding citizens and residents of other countries, I don't know. There may be some taxation there, too.

Whether LillyBeth's premise about the long-term benefits of being properly documented are correct I also don't know. I would need to know a lot of creators and a lot about their financial business to know that.

I do know it's not 'optional'. If you make taxable income from Second Life and don't document yourself properly, you are exposing yourself to possible legal difficulty.

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To say there is no incentive for copybotters just because they can't cash out a large sum of money without ID is just simplistic and not thought out at all. If you observe how copybotters operate or have personal experience as a creator in the trouble that copybotters cause you would not have said that.

Most copybotters sell stolen content at a very low price or distribute them for free, through multiple accounts and even have their own forums outside of SL to discuss copybotting. Not only do they distribute the stolen content which devalues the creations, they also intend to harrass the creators through multiple accounts. As evident through reported chat logs of copybotters, they are mostly a sociopathic group of griefers that get a kick out of offending others and feeling above the law. They are not all interested in getting rich through selling stolen content but more to distribute stolen content to each other so that they have toys to troll the grid with for free and harass the creators that actual made the content. If they are indeed after real money by selling stolen content they still can do so by generating ad revenue on their forums outside SL or they can still go under the radar by selling small ammounts of lindens below the threshold through creating new avatars as copybotters have always done. 

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LillyBeth Filth wrote:

There is some speculation as to whether ALL people who cash out will be required to provide this ID information.

I believe; Yes. They will. 

You may be right, but according to the email that LL sends out - the one that you yourself posted in another thread - LL said they sent it because the person they sent it to has cashed out more than a certain amount "in the last year". They don't say what amount it is but there would be no need to say anything like that at all if they were doing it to everyone who cashes out. So I disagree with you on that point.

At first glance, I agree with you about the benefit of it.

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Freya Mokusei wrote:

I dunno why posters got so snippy about it. I used it as evidence in my dismissal - just as I wouldn't invest in some get-rich-quick scheme that was advertised as "Get free money 4 working from home, Instant affect!" - it was only one part of my reaction of 'Nope, this is silly.'

I realise that it's a 'cheap shot', which is why I had other reasons, too.
:P

The intention behind someones typing is a perfectly fine way to assess ability and insight . Communication is more important than sticking to 'the rules' of English, sure, but it's also (at least here, in this forum) one of the best ways for a poster to be taken seriously. I'm happy to stand by my mistakes because I'm not suggesting anyone accept my reasoning without other evidence - in this case, my central point was that using past as
precident
, LL would never react in this way.

Since you started it, and since you seem to like perfection to the extent of being judgmental when someone writes something imperfectly, it's 'precedent', not 'precident'.

Incidentally, in your first post, the post in which you criticised someone else's grammar, you wrote, "but Linden Lab don't operate". Linden Lab in singular, so it should be 'doesn't' and not 'don't'. There are many people at Linden Lab, of course, but you wrote about the company - singular.

Perhaps you should studiously avoid criticising the grammar and such of others, because the words 'pot', 'kettle', and 'black' spring readily to mind ;)

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C'mon Phil, read the couple of lines around my spelling mistake. Haha.

To repeat the above, I get (with the useful explanation given by Dres here already) that using spelling as a sole point of criticism is dumb, and didn't do that. It was a minor point in a group of other criticisms that other posters to this thread have highlighted better than I did. I tried, I failed, mea culpa (it happens from time to time :P).

Perfectly happy to withdraw my criticisms if it helps people focus on the real issues with the OPs line of thinking (and thanks for making two posts here). Was never interested in being the best at spelling - people have been correcting me since page 1. ;)

It's been fun.

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Grammar police aside... (GOD FORBID if I be judged for my spelling & grammar!)

Of course there is not going to be a 100% wipe of copybook theft.... I never said that so please don't mis quote me.

As I said in my original post... Those that were doing it for the incentive of cold hard cash will potentially have no incentive anymore.

I have been in SL since April 2004. Same account. I have traded in SL since 2005 again, with the same account.

I have expanded beyond SL and sell on websites not affiliated with SL. I have my own two e-commerce websites selling what I make.

I am not making this claim in some bid to say "I know it all"  but rather to imply I have ten years experience of SL which is more than most and I would imagine and that by default this allows me a respectable amount of knowledge.

SL has always had people who sell for the "fame and glory" or the "feel good factor"  One can only assume they don't need the RL cash. Perhaps a retired or stay at home mom who literally are doing Okay on the financial front. Bully for them, I wish I was in their shoes!

The flip side of the coin is there are just as honest and kind hearted people who are trying to make an honest living in SL because they don't have the luxury of financial comfort, who have RL rent to pay and utility bills and who are paying TAX and paying for the licensing for their software they use to make said content and who need to apply a fee to their skill and content.

So regardless of whether the freebie givers are thieves or honest... Both are damaging to the SL economy.

Without the economy,  SL would not be here. Fact. 

 People need their income in SL and a % of that income is being taken from people who use illegal software and dodge the TAX and can afford to drop their prices as a result of this and that is as annoying to me as the copybotters and the naive noob texture resellers... (We have all been there and I myself made some terrible noob mistakes back in the day when Copyright was just a word seen on the back of a DVD case)

My original statement stands;  For those dishonest people who make a false account with the sole intention of making a quick buck by stealing peoples skill and work to  "cash out" that option has now ***potentially*** been removed.

And that HAS to have an effect.. to what degree, time will only tell.

Anyone who has been cashing out on content they sell and who is pissed off that they now have to pay tax.. Welcome to he real world.

Paying TAX is a legal requirement and anyone who is dodging it or complaining about having to start paying it, has by default been dishonest. Just because they could get away with it and no one was asking any questions they felt it was their right.

This attitude of "entitlement" is disturbing.

NO ONE (inc me) 'likes"  paying TAX but we have to accept it because its just the way it is... Its a legal requirement. Period.

It appears people in SL have this belief that because we have a virtual ID and no one really knows who we are or where we live then our financial business should be the same. And it CAN if you don't want or need to cash out. As soon as you start making real money that you spend on real goods then I am afraid you can no longer claim anonymosity or "rights for privacy"

My name and address is all over the internet and has been for many years because I wanted customers to know who and where I am for real. Trust is important.

Anonymous
Anonymous
Anonymous

And for that person saying something about "creation is born out of money" is absolutely wrong.

The most creative people are those that don't have the NEED to sell what they create.. As soon as there is an obligation to create or a pressure to produce for an income, all those creative juices start to dry up.

The most beautiful art has come from those that were poor and did it for the sake of art.

I am done here... I have a job to do :P

 

EDIT:

Why am I bringing unlicensed software into the equation? Because I believe that those people who have been cashing out significant amounts of money and knowingly not declaring it to the TAX authorities because "They don't have to" are not likely to be the type to pay for legitimate software when they can DL it for free from a torrent site, for free.

I am sure if LL had the reason or authority to check the licensing on software used for content created and published on the SLMP we would have another wave of:  "Ooh nooo! Not Fair!! Booo!!" type posts.

And yet I can't help but wonder; What percentage of those very people have been leading witch hunts for SL "thieves" ranting and raging about X Avatar who stole their content? (Which they made on illegal software as they dodged the tax)  LOL

We will never know.. But I for one and pretty sure it's a pretty significant percentage.

 

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Freya Mokusei wrote:

C'mon Phil, read the couple of lines around my spelling mistake. Haha.

To repeat the above,
I get (with the useful explanation given by Dres here already) that using spelling as a sole point of criticism is dumb,
and didn't do that. It was a minor point in a group of other criticisms that other posters to this thread have highlighted better than I did. I tried, I failed, mea culpa (it happens from time to time
:P
).

Perfectly happy to withdraw my criticisms if it helps people focus on the real issues with the OPs line of thinking (and thanks for making two posts here). Was never interested in being the best at spelling - people have been correcting me since page 1.
;)

It's been fun.

Using spelling and grammar mistakes to make any criticism is also just plain dumb, regardless of whether or not it's only one of a number of points. So don't do it. There is absolutely no need for it (unless, like I did, it's written show a pot calling a kettle black). Even if you wrote perfectly it's dumb, but you write very imperfectly - not just ordinary mistakes but also errors through a lack of knowledge - so it's even dumber for you.

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My case is no different from the others, my husband tried to process credit for paypal, one in 01/09 and another on 01/11, we note the delay of payment, then decided to search here in the forum if there was someone with the same problem when I found the post Lilibeth Filth (thank you), he immediately phoned Linden lab, and was informed that both payments were on hold until the completion of Tax Form, Linden lab sent the form he filled in and sent back to LL.
My question:
Anybody here who sent the completed form back to LL had any news about when they go to process payments on hold? They gave some time to pay upon receipt of the form? Will we have to wait another 5 working days? I'm worried, because as many here have expenses RL and SL, and are all delayed.
My very Thank you all, and I hope we have solved our problems.

Ana.

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