Bitcoin Forum

I, for one, welcome our new central Bitcoin banking overlords.

Someone mind explaining to me why you have to claim them on your taxes?
I thought legally Bitcoin was in a grey area at the moment.

It is legally grey as a currency. As an asset its very clear - when it increases above what you paid for it, you are supposed to pay taxes on that.

Too bad I lost all my bitcoins on a unfortunate internet super highway accident.

As an asset its very clear - when it increases above what you paid for it, you are supposed to pay taxes on that.

Horseshit.

Horseshit.

Then say why.

Great response.  ::)

Oh well. Here's another question.. If you don't cash out, do you have to pay taxes?

Even if you do cash out, what idiot would pay taxes on bitcoins?

If audited, you will have to explain how you sent 1k to japan and received 5 back. Doesnt matter where it came from.

Even if you do cash out, what idiot would pay taxes on bitcoins?

Bitcoins are transferred directly and privately from one person to another. Unlike the transfer of gold, stocks, or bonds, you need not involve a bank or broker. This means that no one will ask you to prove your source of funds and demand that you fill out U.S. federal form 8300 if the value of the transaction exceeds $10,000. No banker or broker will secretly report the transfer on federal form 4789. No one will secretly report on federal form 4790 that the transfer crossed national borders. Finally, no one will send the IRS a copy of form 1099 reporting that you paid $100 for bitcoins, then sold them for $150, thereby owing capital gains taxes on $50.

On the other hand, although bitcons’ privacy makes it hard for the government to look over your shoulder, this does not reduce your taxpayer obligation. If you transact bitcoins in a way that uses over $10,000 in currency or that transfers that amount across a national border, or if you sell bitcoins (or anything else, for that matter) for more than you paid, then you have the civic duty as a citizen to voluntarily fill out the appropriate forms and report yourself to the government. Failure to do so is a federal crime.

Just because I ask the question doesn't mean I intend to do it. I just want to know the legality of it.

you have the civic duty as a citizen to voluntarily fill out the appropriate forms and report yourself to the government. Failure to do so is a federal crime.

What idiot leaves an auditable trail in Bitcoin? It was created to allow your financial life to be private.

What idiot leaves an auditable trail in Bitcoin? It was created to allow your financial life to be private.

To be clear, bitcoin was not invented so that you may evade taxes.

It might be easy to create an unauditable trail for 1k dollars... not so much for 500k. Then again, thats a good problem to have I suppose.

Too bad I lost all my bitcoins on a unfortunate internet super highway accident.

It is legally grey as a currency. As an asset its very clear - when it increases above what you paid for it, you are supposed to pay taxes on that.

I recognize that the IRS instils great fear into the hearts of every United States citizen and resident, but the issue here is will this deal actually happen, get delayed or even get cancelled, and what impact this will have if any on the Bitcoin price.

Why would you speculate that the deal is in trouble?  Are there any links you can provide for this?  Also, the title does seem a little like FUD.

I am starting to have some doubts if this deal is even going to happen as it would appear that things are not going according to plan.

1) According to http://coinlab.com/transition (http://coinlab.com/transition), the alpha and beta phases were supposed to be completed by March 15, 2013, last Friday. Has anyone been transitioned?
Furthermore all the United States and Canadian accounts are supposed to be migrated by this coming Friday March 22, 2013, I am starting to wonder if this is going to happen at all.

2) There has been silence on the part of CoinLab for two weeks in their "official thread" https://bitcointalk.org/index.php?topic=148147.0;all (https://bitcointalk.org/index.php?topic=148147.0;all)

The guys buying half a mill worth of Bitcoins already have their balls in the IRS vice. They won't wander far from the reservation anyway.

It's us hoi-polloi leaving ourselves open to the wolves that worry me. If the political powers ever decide to crackdown on Bitcoin users, all of those Coinbase, Gox, etc. customers that gave up details are in the crosshairs.

What idiot leaves an auditable trail in Bitcoin? It was created to allow your financial life to be private.

We have a civic duty to upend the dominant political and economic system. That's what Bitcoin was created for.

If you are implying something other than (potential) evasion happening in general with these folks, I would tend to disagree. Just because you speculate doesnt mean you sell drugs.

I am not sure if the is our "civic duty" to upend dominant political and economic. 

"That" is not what Bitcoin was created for. 

If one is of a more accepting nature when it comes to centralized authority and the power of the collective, then civic duty would be perceived as upholding that authority. If one is more inclined to favor the rights of the individual over the power of the collective, the civic duty would entail defending against that power.

I don't fault anyone for their perceptions but I will fault people for not exploring other avenues of political thought.


Bitcoin's creator was explicit in his intentions. Bitcoin is a political weapon creating a new territory of freedom for users. While I don't adhere to all of Satoshi's thoughts, this one is unmistakeable in its clarity.

Basically Coinlab could end any possible FUD by providing an update and answering questions. At that time depending on the update and answers I will amend my title.

The deal's not in trouble.

We've moved a few key customers over, will announce more information soon.

We are in the market for a communications person -- send your resume's to support@coinlab.com.

The deal's not in trouble.

We've moved a few key customers over, will announce more information soon.

We are in the market for a communications person -- send your resume's to support@coinlab.com.

Given how close the target transition time is, there needs to be a lot more communication from both CoinLab and MtGox about what's happening.  You've got a hell of a lot of customers who need to agree to CoinLab's ToS before the transition date and that really needs to be happening now, not at the eleventh hour.

People are also going to have a ton of questions about the FinCEN guidance statement and how it relates to CoinLab's operations.

This transition can go very badly if MtGox and CoinLab don't constantly remind customers that it's happening and what actions customers themselves need to take.  Maybe you and Mark could take it in turns to keep customers updated because this close to showtime someone needs to be making statements pretty much every day.

+1

Since many feel that this deal can have an impact on the BTC / USD exchange rate I am posting a link to my post here in speculation.  https://bitcointalk.org/index.php?topic=147336.msg1636501#msg1636501 (https://bitcointalk.org/index.php?topic=147336.msg1636501#msg1636501)

Any thoughts on the impact on the price if this deal were to get delayed or to collapse? 

Do you remember how long it took MtGox to get back to trading after they got hacked, and how many deadlines they set, yet nothing happening ? Things takes time, and this community seems to be plentiful with people who are not good at judging how long things will take!  ;D

Do you remember how long it took MtGox to get back to trading after they got hacked, and how many deadlines they set, yet nothing happening ? Things takes time, and this community seems to be plentiful with people who are not good at judging how long things will take!  ;D

It is legally grey as a currency. As an asset its very clear - when it increases above what you paid for it, you are supposed to pay taxes on that.

So, if you own assets like an old master painting, a vintage car, a hundred kilos of silver, and they all double in value - you pay tax on that gain???

Not in most countries.

It is legally grey as a currency. As an asset its very clear - when it increases above what you paid for it, you are supposed to pay taxes on that.

What idiot leaves an auditable trail in Bitcoin? It was created to allow your financial life to be private.

Unrelated to your or my idiocy, this is about the trail in fiat, not in Bitcoin.

If I am not mistaken, didn't he just say they were hiring for a communications person? someone that would communicate to the public what was happening? It seems to me that the main people in CoinLab are very busy right now, hence why they need someone to help communicate to the community what is happening.

http://coinlab.com/transition

Live -- March 22

    We'll have everyone moved over by March 22!


https://mtgox.com/press_release_20130228.html

Mt. Gox, the owner of the world’s dominant Bitcoin exchange, announced today that they have selected CoinLab as their exclusive partner in the United States and Canada. As of March 29, all US and Canadian customers currently transacting with Mt.Gox will transact through CoinLab, Inc.


So what's the story - if coinlab want to do serious business, they should at least ensure the information on their webpage is correct. Has everyone been moved over at this point ? If not, then update the webpage !

I'm in the USA and because of withdraw limits and the balances I have on MTGOX I have been withdrawing a $1000 per day. It has hit my Dwolla in less then a few hours and then to my bank by the next day.So in less then 24hrs from MTGOX to my bank. I've had  good result with MTGOX over the last year or two. I'm not sure how the the Coinlab deal will play out and being how slow info has been from Coinlab on this deal I think it's safer to watch from the sideline. So I have been trying to get all my funds under my full control until the dust settles. As of today the 22ND I have all my cash out but still have about 11-12k USD worth of Bitcoins in MTGOX. I thought it would be moved today but so far it is still on MTGOX in Japan. I will be pulling to my offline wallet shortly. Anyone in the USA get the new MTGOX USA web page when logging in?

It wouldn't take much effort on Coinlab and Mtgox's part to have a blog where they could spend 3 minutes a day updating people about the situation..

They did post on another thread that they wanted to hire a PR person. I suspect that's because whatever Mtgox or CoinLab say will have a noticeable effect on the market.

So in one sense, they're being fair by not posting anything. If they did post something, someone would start to claim they were insider trading on the volatility they can cause.

Still I would personally rather see regular posts. It would be more fair if they posted exactly one article at exactly the same time each day (0:00 UTC maybe?).

It is legally grey as a currency. As an asset its very clear - when it increases above what you paid for it, you are supposed to pay taxes on that.

I hope they hired that PR person, he/she could be needed just about right now!  :o

If we see mtgox closed price will be single digits.

Why?

I updated the initial post to reflect the current situation. I must say did not expect litigation when I started this thread back in March. Now for the relevant question in the speculation sub forum. What impact will this litigation have on the BTC/USD exchange rate?

Nothing. Such pathetic squabbles are irrelevant to most powerful idea for the internet since the WWW.