IRS summons PayPal info on offshore bank users
Subj: IRS summons PayPal info on offshore bank users
http://www.mercurynews.com/mld/mercu...y/14318348.htm
Posted on Tue, Apr. 11, 2006
IRS asks PayPal for help finding taxpayers hiding income offshore
WASHINGTON (AP) - The Internal Revenue Service won approval from a
federal court in California to ask PayPal to turn over information
about people who might be evading taxes by hiding income in other
countries, officials said Tuesday.
A federal court in San Jose gave the IRS permission to ask PayPal --
a company that enables online money transfers -- for account
information for American taxpayers who have bank accounts, credit
cards or debit cards issued by financial institutions in more than
30 countries reputed to be tax havens.
PayPal spokeswoman Amanda Pires said the company just received the
summons.
``We're still evaluating our options,'' she said. ``The privacy of
our customers' information is something we take really seriously.''
PayPal enables individuals and businesses around the globe to send
and receive money online. In 2005, users moved $27.5 billion
through the money transmitter. The company, owned by eBay, has 100
million account holders globally.
The request for information is an outgrowth of an IRS effort, begun
several years ago, to trace money that American taxpayers hold
offshore to avoid paying taxes. The IRS said many of those
taxpayers access their money through credit and debit cards. The
tax collectors have already obtained information from some credit
card companies, merchants and payment processors.
``PayPal is another one of the mechanisms by which money stashed
overseas might be spent,'' Eileen OConnor, assistant attorney
general for the Justice Department Tax Division, told reporters.
In some cases, the IRS obtained credit card numbers but could not
identify the cardholder. The IRS said PayPal might be able to lead
the tax agency to those individuals.
The IRS also hopes PayPal can help them identify currently unknown
taxpayers' and their payment cards , as well as offshore bank
accounts, that might be evidence of tax evasion.
The request covers transactions occurring from 1999 through 2004.
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