David BlumePrank: How To Trick Your American Friends Into Owing the IRS More
Give your American friend the keys to your car, and say, "Here, it's yours for $20,000.00." (Better, choose some fair market value based on the Kelly Blue Book.) When they look at you like you're nuts because they don't want to pay $20,000.00 for your used car, take the keys back and say, "Fine. I'll retake possession of my car, and you don't owe me the $20,000.00 anymore. Your loss."
Then, fill out a Form 1099-C (http://www.irs.gov/businesses/page/0,,id=23108,00.html), forgiving your friend of the $20,000.00 debt, since you no longer expect them to pay for the car.
When their government sees that your friend didn't pay you the $20,000.00, they'll collect taxes on the $20,000.00 as new ordinary income!
Huzzah! You just screwed your friend out of $7,000.00 which they'll now have to pay to the IRS!
(Based on a true life adventure.)
[Edit] Also inspired by the "Quit Claim" form usage found in the "Held Hostage" story here: http://www.thisamericanlife.org/radio-archives/episode/409/transcript
#forgivenessofdebt
Give your American friend the keys to your car, and say, "Here, it's yours for $20,000.00." (Better, choose some fair market value based on the Kelly Blue Book.) When they look at you like you're nuts because they don't want to pay $20,000.00 for your used car, take the keys back and say, "Fine. I'll retake possession of my car, and you don't owe me the $20,000.00 anymore. Your loss."
Then, fill out a Form 1099-C (http://www.irs.gov/businesses/page/0,,id=23108,00.html), forgiving your friend of the $20,000.00 debt, since you no longer expect them to pay for the car.
When their government sees that your friend didn't pay you the $20,000.00, they'll collect taxes on the $20,000.00 as new ordinary income!
Huzzah! You just screwed your friend out of $7,000.00 which they'll now have to pay to the IRS!
(Based on a true life adventure.)
[Edit] Also inspired by the "Quit Claim" form usage found in the "Held Hostage" story here: http://www.thisamericanlife.org/radio-archives/episode/409/transcript
#forgivenessofdebt