Bitcoin Forum

I lost all my Bitcoin to a hard drive failure, do I still have to pay taxes to the Reptilian banking cartel?

I don't think so.

In short, if you lost your bitcoin, you can claim and report it to Reptilian banking cartel for deduct your taxes. To calculate bitcoin taxes is by capital gains. I think if you lost all of your bitcoin you don't need to pay the taxes, because your no longer have the asset. But, taxes on every country are different, you can try contact it.

Ahh. Going with the classic lost-in-a-boating-accident route eh? (context[1 (https://twitter.com/WhalePanda/status/979813470148464640)][2 (https://twitter.com/fluffypony/status/896961261937856512)])  ;)

Anyway, assuming you didn't declare that you had bitcoin in the first place, or probably unless you bought good amounts on KYC exchanges like Coinbase, I don't think you need to pay taxes.

Probably he declares it since he ask this issue. And there is no other way to hide it if he bought to a regulated exchange. I believe its better to prepare the tax rather than explaining how he lost it. This reason might be used tons of times by the tax evading guys out there too. So goodlucm on explanation.

I still don't understand why all these people pay taxes for btc.

Pretty much having the fear of alerting the IRS(one way or another) and having them knocking on your door; which is a very reasonable 'fear' to have if you ask me.

Can they prove you owned it? If so, did you buy it or earn it. If you bought it, you don't owe taxes anyway.

Can they prove you sold it for their fiat currency? If so, you're at risk...how much did you sell? How much tax would it have incurred?


Listen, I see where you're coming from. But the government (all of them) do have the power to push this cryptocurrency thing deep underground. They can make it very difficult for any of us to embrace this system. Maybe we choose to operate with cryptocurrency in a way that doesn't completely insult the incumbent system that everyone else on the planet is operating within. Maybe we pay taxes because we know the money helps those in need. Maybe we pay taxes because it's more parts right thing to do than it is corrupt?

I'm sorry because of your bad luck, hope you didn't loose to much.
Regarding taxes,  every country have different laws and rules so better ask in your local tax office or check with accounting service.
In my country,  for example,  we only need to pay taxes if we exchange crypto to fiat but if we can prove that we holded  crypto at least 2 years than we don't need to pay any taxes.

do you have tried harddrive recovery? format recovery etc.? or restore our drive like windows restore point?
i think you didn't have bussiness to pay Tax, how can you pay tax if you can't calculate your bitcoin too?
you didn't own your bitcoin, and now you lost it, maybe you can report to tax officer to remove from your asset  :-\

I assume the context is that you do not have a backup policy that enables you to retrieve the BTCs, and that the required disk files are not recoverable using available tools and services. Being that the case, there is still quite a bit of context lacking in the OP such as what you have declared to have before to the taxation office (IRS or equivalent), what country’s legislation is applicable, and so forth, what are the traces that tie you to those BTCs in the eyes of the taxation office (i.e. bought on an exchange using a bank that you know informs the office on the transfers), etc.
 

No, he does have a point: OK, for what we change into fiat, it may be somewhat reasonable to pay taxes. But for the Bitcoin in the wallets...?
On the other hand, as long as the private key/seed can be stored on a piece of paper, the HDD can be broken 1000 times and the coins are actually not lost. So it's not really the best possible proof / story.

He does have a point, it's just that fear and risk are really subjective; and I think andulolika was talking about income taxes from bitcoin/crypto trading in general, not only on OP's case.

OP claimed on the topic title that the BTC is already lost, so we can probably safely assume that OP doesn't have a proper backup; hence he wouldn't be asking this question in the first place.

I'm not paying taxes, they already taxed me when I trade my Cryptocurrency to our local exchange, and besides earnings on my Bitcoin are not yet listed, in the tax listed that we are going to pay our government, I guess it's a government to government issue, but if you really loss your Bitcoin, and you have proof that you really lost it, then you don't have to pay taxes on something that you do not have or lost, that is my take but a lawyer in your country should be the one to give you a good advice.

No... That's actually the other way around. That is tax deductible and they owe you that much basically. So if you lost 1 BTC you will not pay tax until you make that 1btc back. Remember you only pay tax on profits. This is why it's a good idea to reinvest back into your business to avoid tax. You can also hire people to reduce tax too.

i wonder how you will be charged for that since there is no transaction again with your account. i doubt if you still pay taxes.

It all depends on where you live and how you obtained the BTC.

Where I'm at if I'd just bought it then no. If I got it by earning it and trading if it's above the limits they give then I'm still liable for the tax on those earnings even if I have no way of paying it.

Look at these people who did a million shitcoin trades, wound up with nothing and didn't realise every trade was taxable.

Still, I wouldn't bother mentioning it.

Are you sure you guys don't have a "casualty" tax deduction? In the states, you can file Form 4684 (Casualties and Thefts) (https://www.irs.gov/pub/irs-pdf/f4684.pdf) to account for losses from any kind of act of God, hack, theft, etc. where you lost bitcoins. There are some limitations, though. This is the breakdown (https://ttlc.intuit.com/community/tax-credits-deductions/discussion/how-do-you-claim-losses-from-crypto-currency-theft/00/504041) for a "tragic boating accident" sort of tax deduction in the US:


So, no matter how you came to own the property (investment vs. earned income), you can recoup a big chunk of the theft/casualty loss in tax deductions. Exactly how much you can deduct is determined by your total income.

I've burnt everything the tax man has ever sent me unopened so wouldn't have a clue, but I've never heard of anyone talking about something like that. If it were that easy everyone would be saying their bank account caught fire when it was time the pay the tax bill.

The tax man don't give a shit you don't have the money now. It's your responsibility to have kept it back.

The op has not provided any kind of information to us whether he brought those coins or he earned it via some services he may have provided, and till he doesn’t clarify this how are we supposed to guide him about his tax liability?. @gentlemand how does the taxman find about these trades if the person doesn’t disclose it?, or do taxmen get inputs from the exchanges regarding these transaction can you clarify this part?.

After reading all the comments I found this as the genuine and honest reply to OP.

What I believe is you still have to pay tax because you were entitled to pay tax when you bought the coins so no matter if you lost them or not you are still required to pay tax even so you tell them that you have lost.


If the OP is saying that he still have to pay tax... then it makes us clear that he must've used some exchange or some way where he has provided the information like KYC etc otherwise he wont bother to ask.

P.S why I am unable to give merit? It says 0 _{don't worry reply me in inbox if someone knows why I have 0 to keep the thread clean}

Regards

It varies from country to country but the IRS in America has contacted exchanges asking for user details and the British equivalent will soon as well.

You may well be fine not disclosing anything but there's no telling what the future holds. One day there might be software that links you to everything you've ever done in cryptoland in less than a second and spits out a bill.

Dont know which country you are from. If you have declared bitcoins in your annual tax returns then you have to pay the taxes. Consult some tax lawyer that what your country law says regarding that issue.

If your goverment requires the payment of taxes on income when working with cryptocurrencies and if you use an exchange that independently or upon request sends user data to the tax authorities, then you will have to prove that you really lost access to your wallet and most like you will have to provide wallet address on which your BTC is still stored, otherwise the tax authorities will not believe you and will force to pay the tax.

They first need to know for sure that I have BTC. In addition, the possession of BTC does not yet indicate that I received a profit. The profit will be visible only when I withdraw money to the card. And here it will be necessary to calculate how much profit I received during the time of BTC ownership.