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Something that hasn't been mentioned yet - if your games contain any form of gambling mechanics (loot boxes, gacha systems, etc.), you might face additional regulatory requirements beyond standard VAT/GST in some jurisdictions. Some countries are starting to classify these features under gambling regulations which can affect taxation.
That's a really good point! We actually do have some games with random reward mechanics. Do you know which countries have specific tax regulations for these features? I know there are gambling regulations in some places, but wasn't aware of specific tax implications.
Belgium, the Netherlands, and Japan have been at the forefront of regulating loot boxes, though their approaches differ. Belgium has essentially classified them as gambling, which has both regulatory and tax implications. Japan has specific regulations for gacha mechanics. South Korea has a complex system where certain game mechanics can trigger different tax classifications. China has restrictions on these features that don't necessarily change the tax classification but do impact how you can monetize. The UK is currently reviewing these mechanisms, and there's a possibility of new classifications coming. The tax implications often follow the regulatory ones - once something is classified as gambling or a regulated activity, different tax rules typically apply.
One thing I'd add from my experience working with international tax compliance is that the classification often depends on how your games are structured from a business model perspective. For example, if you're selling a complete game as a one-time purchase, it's almost always treated the same as other software. But if you have ongoing services like multiplayer servers, regular content updates, or social features, some jurisdictions might classify portions of your revenue as "digital services" rather than software sales, which can have different VAT treatment. Also worth noting - some countries have started implementing digital services taxes (DST) that specifically target large tech companies, but these typically have revenue thresholds that might not affect smaller game developers. However, if you're distributing through major platforms, you might indirectly be affected by how those platforms handle DST compliance. The key is to document your game's features and revenue streams clearly, as tax authorities are increasingly looking at the substance of digital products rather than just broad categories.
This is really helpful! I hadn't considered how the ongoing service components might affect classification. Our games do have multiplayer servers and we push regular content updates - does this mean we need to split our revenue recognition for tax purposes, or is it more about how we report the overall product category? Also, regarding the DST thresholds you mentioned, do you know roughly what those revenue levels are? We're growing pretty quickly and want to make sure we're prepared if we hit any of those triggers.
Great question about revenue splitting! In most cases, you don't need to split the revenue for tax purposes unless you're specifically charging separately for different components (like base game + subscription fees). If customers pay one price for the complete package including servers and updates, it's typically treated as a single digital product sale. However, if you have separate charges - say a $60 base game plus a $10/month subscription for premium features - then yes, you'd likely need to treat those as different revenue streams with potentially different tax treatments. Regarding DST thresholds, they vary significantly by country. France's DST applies to companies with global digital revenue over ā¬750M and French digital revenue over ā¬25M. The UK's DST has similar thresholds (Ā£500M global, Ā£25M UK). Italy and Spain have comparable levels. Most smaller game companies won't hit these thresholds directly, but as I mentioned, you might be affected indirectly through your distribution platforms. The EU is also working on a unified DST that could replace individual country versions, but implementation keeps getting delayed. Worth monitoring if you're doing significant business in Europe.
Based on your description of "discrepancy in filing status parameters," it sounds like you might have received a CP01H notice or similar correspondence. The fastest route is usually the Identity Verification Service at 800-830-5084, but I'd recommend first checking if you can complete the verification online through ID.me if that option was mentioned in your notice. If you must go in-person, call 844-545-5640 to schedule at your local TAC office. Make sure to ask specifically what type of verification they need when you call - this will determine exactly which documents to bring. The representatives can also clarify if your situation requires in-person verification or if there are online alternatives available. Have you received any specific letters or notices from the IRS about this discrepancy? That would help determine the exact process you need to follow.
This is really helpful! I'm in a similar situation and wasn't sure if the online ID.me option would work for my case. Quick question - when you call 844-545-5640, do they ask for any specific information upfront to determine if you qualify for online verification instead of in-person? I'd hate to schedule an appointment if I could just do it online and save the trip.
I went through this exact process about 6 months ago. First thing - check what specific letter code you received (like CP01H, 5071C, etc.) as this determines your path forward. For scheduling in-person verification: ⢠Call 844-545-5640 for TAC appointments ⢠Have your notice/letter ready when you call ⢠They'll tell you exactly which documents to bring Before going in-person though, definitely check if online verification through ID.me is available for your situation - it's much faster if you qualify. The phone representatives at 844-545-5640 can actually tell you right away if online verification is an option for your specific case. Pro tip: If you do need to go in-person, schedule ASAP as TAC appointments can book out 2-3 weeks in advance, especially during tax season. And yes, bring extra documentation beyond what they ask for - better to have too much than make a second trip. What type of notice did you receive? That detail would help everyone give you more targeted advice.
Yall need to chill lol. IRS TREAS 310 just means its a refund deposit. TAX REF literally means tax refund. I get these every year, sometimes multiple times if they adjust something. Just wait for the letter. If you're worried about spending it, just transfer it to a savings account until you know for sure what it is.
Easy to say "just wait for the letter" but some of us need that money now if it's legit! Bills don't wait for IRS explanation letters that take 2-3 weeks to arrive...
I totally get the anxiety around unexpected IRS deposits! I had a similar situation last year where I got an IRS TREAS 310 deposit that was about $900 more than my expected refund. Turns out the IRS automatically applied the Recovery Rebate Credit for the third stimulus payment that I had missed when filing. The key thing is that "IRS TREAS 310 TAX REF" is definitely a legitimate IRS refund code, so you don't need to worry about it being fraudulent. However, I'd recommend doing what others have suggested - don't spend it immediately until you get the explanation letter or can verify what it's for through your IRS online account. You can create an account at irs.gov and check your tax account transcript, which should show any adjustments they made to your return. That way you won't have to wait weeks for the mail and can have peace of mind about whether it's money you can actually use. In my case, seeing the adjustment on my transcript gave me the confidence to use the money for bills while I waited for the official letter.
This is really helpful advice! I didn't know you could check your tax account transcript online to see adjustments before getting the letter. That would definitely save a lot of anxiety. How quickly does the transcript usually update after they make an adjustment? Like if I got the deposit yesterday, would the transcript already show what it's for?
Dont hold ur breath lol... my 2022 amended return took 11 months to process!! Filed March 2023, finally got resolution February 2024. The system is totally broken. And I was owed money the whole time with no interest paid to me of course. But if you owe them? Interest starts immediately š
I'm in a very similar situation! Filed my 2023 amended return in December after realizing I missed reporting some cryptocurrency gains. It's been about 3 months now and the "Where's My Amended Return" tool still just shows "received" with no processing updates. Based on what everyone's sharing here, it sounds like 16-20+ weeks is pretty normal right now. I'm trying to be patient but it's frustrating not knowing if there are any issues or if it's just sitting in the queue. Thanks for asking this question - it's reassuring to know I'm not the only one dealing with the long wait times. Going to try checking my transcript online like @Adriana suggested to see if that gives more detail than the amended return tool.
@Carmen, you're definitely not alone! I'm also waiting on a 2023 amended return - filed mine in January after catching an error on my state tax deduction. It's been about 8 weeks now with zero updates beyond "received." The transcript checking tip is really helpful - I just created my IRS online account yesterday and can see way more detail than that useless amended return tool. At least now I know mine is actually in the system and not lost somewhere. It's frustrating that we're basically flying blind for months, but sounds like this is just the new normal with IRS processing delays. Hang in there!
James Johnson
Anyone know what a typical percentage of your gross income should go to these deductions? I make about $65k annually and it seems like a huge chunk disappears before I even see it.
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Sophia Rodriguez
ā¢For someone making $65k, you're probably looking at roughly: - 12-22% federal income tax (depending on your W-4 settings) - 6.2% Social Security - 1.45% Medicare - 0-10% state income tax (hugely varies by state) - Plus any voluntary deductions like retirement, health insurance, etc. All in, most people see about 20-30% of their gross pay going to various deductions before getting their net pay.
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Isaiah Sanders
I used to be just as confused about paycheck deductions! One thing that really helped me was requesting a detailed breakdown from HR - most companies are required to explain what each deduction code means if you ask. Also, don't forget that some deductions might be pre-tax (like health insurance premiums or 401k contributions) which actually reduces your taxable income, while others are post-tax deductions. This can make a big difference in how much you're actually paying. If your deductions suddenly increased by $95, it could be because you enrolled in benefits during open enrollment, got a raise that pushed you into a higher tax bracket, or changed your W-4 withholdings. I'd definitely check with HR to see if anything changed in your payroll setup recently.
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