topic Re: FDIC interference? in General Credit Topics

FDIC interference?

IOBA — Tue, 01 Feb 2011 19:51:33 GMT

I will probably call FDIC direct, but thought I would put this out here first.

My x friend has made bad choices. Bounced checks, charge-offs, etc.

What she has recently complained about is her direct deposits from ss are sometimes coming through and sometimes not. She is not eligible for a bank account due to her past actions, so she has it put in a relatives account. And about half the time, the deposits are sent back to ss.

Both ss and the receiving bank verify all information is correct. So it made me wonder, would FDIC interfere with her deposits?

The bank said they could if there were garnishments or liens against her. **I don't think she has any of these yet.**

Does anyone have any thoughts or experience with this? I have the number for FDIC but not ready to call them. lol - it's not that important to me.

Thanks!

Re: FDIC interference?

IOBA — Tue, 01 Feb 2011 19:52:59 GMT

PS - eventually, she does get the money. I suspect the IRS will be garnishing her ss check soon, since she owes taxes for 2009 & 2010. She's basically telling the IRS it's NOT her fault and they can FOAD.

Re: FDIC interference?

laz98 — Tue, 01 Feb 2011 20:24:07 GMT

is it really not her fault? just curious. my gf's dad is a CPA, maybe i will ask him

Re: FDIC interference?

MarineVietVet — Tue, 01 Feb 2011 21:48:55 GMT

I don't know for sure but i wouldn't think this would be a concern or a function of the FDIC.

However you need to tell your friend that the IRS does not have a sense of humor when it comes to collections and ignoring them will not make it all go away. The longer she puts this off the more she will possibly owe in penalties and interest when it all finally catches up to her. And it will.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Re: FDIC interference?

IOBA — Tue, 01 Feb 2011 21:51:34 GMT

In her opinion, NOTHING is EVER her fault!!!!

It could be bad luck about her checks, or it could be that she's p'o'd the wrong person/entity. Either way, I suspect the IRS will garnishing her check soon.

I would love to hear back what your CPA friend says. My banker thought it was VERY plausible that if the wrong people/entity was upset, that they would use the FDIC to track her money movements. And ya know, that kinda makes sense to me, if there is a lien or garnishment out there for a govt entity. Not sure if they could legally do it or not, but who knows?

Re: FDIC interference?

IOBA — Tue, 01 Feb 2011 21:56:01 GMT

Marine - I agree. I have been trying to get her to agree to talk to them or to set up payments. I have a POA for her (from last year when she needed help), so I could do it, BUT I am not messing with the IRS without some basic information first (like her information from HR Block for 2009) so I can find out who has liability there. I suspect she does, although she denies it.

I wont' set up payments for her --- she wont' agree to giving the IRS a dime. Nada. And she definitely owes for 2010. She won't give me permission to file for her, but I am given all the icky mail. Hhmm....go figure.

She contacts me when she wants money -- which I wont' loan to her.

So, ladeda. Whatever happens, happens. It's not my responsibility to chase down her responsibilities or to solve her problems. And if she wont' listen about the IRS, or the banks, or anything else, oh well.

Re: FDIC interference?

MarineVietVet — Tue, 01 Feb 2011 21:58:47 GMT

@IOBA wrote:
Marine - I agree. I have been trying to get her to agree to talk to them or to set up payments. I have a POA for her (from last year when she needed help), so I could do it, BUT I am not messing with the IRS without some basic information first (like her information from HR Block for 2009) so I can find out who has liability there. I suspect she does, although she denies it.

I wont' set up payments for her --- she wont' agree to giving the IRS a dime. Nada. And she definitely owes for 2010. She won't give me permission to file for her, but I am given all the icky mail. Hhmm....go figure.

She contacts me when she wants money -- which I wont' loan to her.

So, ladeda. Whatever happens, happens. It's not my responsibility to chase down her responsibilities or to solve her problems. And if she wont' listen about the IRS, or the banks, or anything else, oh well.

I agree 100%.

Re: FDIC interference?

laz98 — Tue, 01 Feb 2011 21:59:17 GMT

i will post when i hear something back...

from the perspective of someone who hears about people's finances & taxes day in & day out, she is being very stubborn & naive to think the IRS won't come after her. people come into the CPA office all the time, wondering why there is suddenly a garnishment on their wages, or a tax lien on their home. so many people think that they can just tell the govt to FOAD, but that's just not the case. it may take time, but it always catches up to you.

Re: FDIC interference?

laz98 — Wed, 02 Feb 2011 02:59:18 GMT

ok, here is what i got...it's not much though. he was pretty busy, so i got a condensed version.

he said it probably has nothing to do with the FDIC, it's probably that it's not her account, & it could be they are looking into it for possible SS fraud. is your friend's aunt a representative payee on her SS paperwork? that would authorize her to receive the payments for your friend, & might smooth any issues as far as account ownership goes. (i didnt' ask about this, but can't she just get a paper check? i know they discourage it, but it's not forbidden. might be easier than all this stuff!)

he strongly advises her to set up a payment plan with the IRS, because they CAN & they WILL take her money, no question. i'm sure she doesn't want that. has she been in contact with the IRS at all? as MVV stated, interest & penalties are just piling up on her. does she work?

Re: FDIC interference?

IOBA — Wed, 02 Feb 2011 21:45:34 GMT

Her reality is different from most people's.

1.) She has trouble with paper checks because she can not cash them. No bank will let her inside their doors. She's cost too many of them money and then has politely told them to FOAD.

2.) Her last set of paper checks she signed over to me and I deposited. But the bank (Bank of America) would not release the funds for five days. It was a Friday late afternoon before a three day weekend. BA doesn't feel that they need to immediately release gov't funds. I did not have enough cash in my account to cover her checks, not that I would have anyways, because in a sense that would be loaning her money. The check cashing places will not cash her checks anymore either. I don't know what that real story is.

3) She knows she owes for 2009 to the IRS. She says it's HR's fault because they held her Traditional IRA and they gave her disbursements from it (drained the account), therefore they should have known about it and included it on her tax return. Since they did not, and she pays them a lot of money for protection, it's on them, not her. And before you ask --- no, she will not call HR and talk to them. It's not her problem, therefore not her responsibility to inform them THEY owe the IRS $1500 from THEIR mistake.

4) She thought she might owe for 2010. When her 1099's came in, I ran them through the tax program, and she definitely owes! It's about 5k. She paid NO taxes during 2010 and her taxable income was roughly 42k. Again, she doesn't feel this is an issue. I told her about about the tax return and owing money. I asked her about sending them some money from her income. She said no - the IRS does not get a dime.

5) There was a problem with her ss check coming in and she refused to call to find out what happened. That is what prompted me to wonder about the FDIC.

6) She has no intention of calling HR block or the IRS regarding 2009 & 2010.

Advice please -- since I have all of her tax info for 2010, should I just file her taxes (saying she will pay later) for her? OR leave it alone and let the IRS catch up with her later and ask for her return?

Thoughts -- how long do you think before the IRS takes action regarding 2009 taxes? 2010 taxes? Her notice from the IRS came end of December 2010 (re: 2009). She hasn't and won't respond to the IRS. She has one valuable asset - a vehicle, paid in full, that the IRS could possibly find out about. No bank accounts in her name.

Re: FDIC interference?

laz98 — Wed, 02 Feb 2011 22:02:10 GMT

Advice please -- since I have all of her tax info for 2010, should I just file her taxes (saying she will pay later) for her? OR leave it alone and let the IRS catch up with her later and ask for her return?

Thoughts -- how long do you think before the IRS takes action regarding 2009 taxes? 2010 taxes? Her notice from the IRS came end of December 2010 (re: 2009). She hasn't and won't respond to the IRS. She has one valuable asset - a vehicle, paid in full, that the IRS could possibly find out about. No bank accounts in her name.

wow, i can't believe check-cashing places won't take her checks either!

if all she has is 1099s for 2010, it's not surprising that she owes money.

h & r block are some fairly incompetent people. the CPA office has plenty of people coming in asking them to fix HRBs' mistakes. right now they are working on one where HRB told a woman she owes over $4k. in reality, she should be getting about $800 back.

if she is not going to work with the IRS, there is no point in you filing her taxes. the interest & penalties will work out the same either way. the only difference is that the IRS gets more pissed off when you don't file, because it gives a perception of tax evasion (not too far off in this case). i would say leave her to her own destruction.

there is really no set amount of time before they catch up with her. it's happening more frequently now because the govt doesn't have any money, but there is no way to say when they will get to her case. could be tomorrow. i would imagine that her ignoring their communications can only accelerate the process.

sounds like they probably wouldn't take her car, but with the govt, you can never be too careful!

look out for yourself in this scenario. it sucks that you are stuck down in it with her.

Re: FDIC interference?

MattH — Thu, 03 Feb 2011 00:23:35 GMT

IOBA wrote:
Her reality is different from most people's.

1.) She has trouble with paper checks because she can not cash them. No bank will let her inside their doors. She's cost too many of them money and then has politely told them to FOAD.

2.) Her last set of paper checks she signed over to me and I deposited. But the bank (Bank of America) would not release the funds for five days. It was a Friday late afternoon before a three day weekend. BA doesn't feel that they need to immediately release gov't funds. I did not have enough cash in my account to cover her checks, not that I would have anyways, because in a sense that would be loaning her money. The check cashing places will not cash her checks anymore either. I don't know what that real story is.

3) She knows she owes for 2009 to the IRS. She says it's HR's fault because they held her Traditional IRA and they gave her disbursements from it (drained the account), therefore they should have known about it and included it on her tax return. Since they did not, and she pays them a lot of money for protection, it's on them, not her. And before you ask --- no, she will not call HR and talk to them. It's not her problem, therefore not her responsibility to inform them THEY owe the IRS $1500 from THEIR mistake.

4) She thought she might owe for 2010. When her 1099's came in, I ran them through the tax program, and she definitely owes! It's about 5k. She paid NO taxes during 2010 and her taxable income was roughly 42k. Again, she doesn't feel this is an issue. I told her about about the tax return and owing money. I asked her about sending them some money from her income. She said no - the IRS does not get a dime.

5) There was a problem with her ss check coming in and she refused to call to find out what happened. That is what prompted me to wonder about the FDIC.

6) She has no intention of calling HR block or the IRS regarding 2009 & 2010.

Advice please -- since I have all of her tax info for 2010, should I just file her taxes (saying she will pay later) for her? OR leave it alone and let the IRS catch up with her later and ask for her return?

Thoughts -- how long do you think before the IRS takes action regarding 2009 taxes? 2010 taxes? Her notice from the IRS came end of December 2010 (re: 2009). She hasn't and won't respond to the IRS. She has one valuable asset - a vehicle, paid in full, that the IRS could possibly find out about. No bank accounts in her name.

Yikes, I would expect sooner or later she and external reality are gonna have a nasty collision. I forget who it was that said, "reality is whatever does not go away just because you stop believing in it."

Re: FDIC interference?

IOBA — Thu, 03 Feb 2011 03:17:10 GMT

Thanks Laz98 & MattH for the feedback.

In mentally reviewing things, I realized her 1099 G (state tax refund) had not arrived when I ran her numbers. So in reality, she may owe even more money.

With regards to your advice, I will not be filing her taxes for her. I might print out what I have and give it to her. But that is it.

Technically, she has two vehicles, paid off, in her name. So I can see the IRS coming after at least one of them. I hope they do.

Re: FDIC interference?

laz98 — Thu, 03 Feb 2011 03:27:18 GMT

from what i have been reading, since this has really piqued my interest, the IRS can come in & inventory your home to see what they can take! they need a court order to do so, but it's pretty much a rubber stamp sort of thing. having 2 paid off vehicles probably does not help her case, since that's less debt that she can claim is keeping her from paying her taxes. i'm glad you are going to steer clear of the fallout that is sure to rain down on her.

Re: FDIC interference?

IOBA — Thu, 03 Feb 2011 03:30:48 GMT

Wow - she says she has tons of expensive jewelry.

Hey, she paid cash for a 12k ring. The jewelry store mailed her a form and said they sent a copy of it to the IRS. They said they were required to do so because she paid cash. Any clue about that?

I don't see any place to claim that on her taxes, and don't even think it is claimable. But what does the IRS do with the information?

Re: FDIC interference?

laz98 — Thu, 03 Feb 2011 03:50:05 GMT

it raises a red flag & may cause the IRS to investigate you for money laundering, etc. it's not something she has to claim on her taxes, from what i understand. however, comma, the IRS is DEFINITELY going to want to know how she can afford to pay CASH for a 12k ring & not pay her d*** taxes!!!

Re: FDIC interference?

IOBA — Thu, 03 Feb 2011 04:11:50 GMT

My accounts don't see that kinda of money activity! I don't even have that much in cash reserves! Nor do I own possessions that are worth that much! The (new/old) family vehicle is worth about 9k, the little furniture we have is worth 5k maybe? No jewelry worth that much...I do have a million dollar smile. Does that count??

They can talk to her about her finances. The cash purchases she made are explainable, if she takes the time. She just needs to do that.

Re: FDIC interference?

laz98 — Thu, 03 Feb 2011 04:16:19 GMT

@IOBA wrote:
My accounts don't see that kinda of money activity! I don't even have that much in cash reserves! Nor do I own possessions that are worth that much! The (new/old) family vehicle is worth about 9k, the little furniture we have is worth 5k maybe? No jewelry worth that much...I do have a million dollar smile. Does that count??

They can talk to her about her finances. The cash purchases she made are explainable, if she takes the time. She just needs to do that.

sorry, i didn't mean YOU personally, i just meant in general. didn't mean to give you a heart attack!

not to argue with you, but i don't see how that purchase would be explainable...

Re: FDIC interference?

MarineVietVet — Thu, 03 Feb 2011 04:47:25 GMT

@IOBA wrote:
Her reality is different from most people's.

1.) She has trouble with paper checks because she can not cash them. No bank will let her inside their doors. She's cost too many of them money and then has politely told them to FOAD.

2.) Her last set of paper checks she signed over to me and I deposited. But the bank (Bank of America) would not release the funds for five days. It was a Friday late afternoon before a three day weekend. BA doesn't feel that they need to immediately release gov't funds. I did not have enough cash in my account to cover her checks, not that I would have anyways, because in a sense that would be loaning her money. The check cashing places will not cash her checks anymore either. I don't know what that real story is.

3) She knows she owes for 2009 to the IRS. She says it's HR's fault because they held her Traditional IRA and they gave her disbursements from it (drained the account), therefore they should have known about it and included it on her tax return. Since they did not, and she pays them a lot of money for protection, it's on them, not her. And before you ask --- no, she will not call HR and talk to them. It's not her problem, therefore not her responsibility to inform them THEY owe the IRS $1500 from THEIR mistake.

4) She thought she might owe for 2010. When her 1099's came in, I ran them through the tax program, and she definitely owes! It's about 5k. She paid NO taxes during 2010 and her taxable income was roughly 42k. Again, she doesn't feel this is an issue. I told her about about the tax return and owing money. I asked her about sending them some money from her income. She said no - the IRS does not get a dime.

5) There was a problem with her ss check coming in and she refused to call to find out what happened. That is what prompted me to wonder about the FDIC.

6) She has no intention of calling HR block or the IRS regarding 2009 & 2010.

Advice please -- since I have all of her tax info for 2010, should I just file her taxes (saying she will pay later) for her? OR leave it alone and let the IRS catch up with her later and ask for her return?

Thoughts -- how long do you think before the IRS takes action regarding 2009 taxes? 2010 taxes? Her notice from the IRS came end of December 2010 (re: 2009). She hasn't and won't respond to the IRS. She has one valuable asset - a vehicle, paid in full, that the IRS could possibly find out about. No bank accounts in her name.

Walk away and don't look back. It would be different if she was not capable of handling her own affairs but she is capable. She doesn't care about her situation and neither should you.

Let her sink or swim on her own.

Re: FDIC interference?

Imua — Thu, 03 Feb 2011 16:11:43 GMT

@laz98 wrote:
it raises a red flag & may cause the IRS to investigate you for money laundering, etc. it's not something she has to claim on her taxes, from what i understand. however, comma, the IRS is DEFINITELY going to want to know how she can afford to pay CASH for a 12k ring & not pay her d*** taxes!!!

yes, i believe that any cash transaction of $10,000 and over is reportable to the IRS. iirc, this was put into effect after 9/11/01.

i paid cash ($14,000) for a new car in 2002, and the car salesman had to ask me where the $ was coming from (my savings acct) - he said he was required by law to furnish that info to the IRS.

i'm curious as to where she keeps her $ if she doesn't have a bank acct - under her mattress?