Bitcoin Forum

I have seen many posts from folks incredulous on the reversal that started after the 10th.  They say there is no news and no new fiat that would support a rally.  While much of the rise is probably unrelated to any news, and more technical in nature, I offer this as one piece of news I would classify as bullish.  There is now a bill in Congress to treat Bitcoin as currency for tax purposes:

http://www.breitbart.com/Breitbart-Texas/2014/04/10/Rep-Stockman-Proposes-New-Method-of-Taxation-on-Bitcoins

-Raystonn

That would be FAR worse, for me at least.  I plan on retiring and paying 0% taxes!  How can I do that if they class it as a currency?

Have to agree here...  I saw people going all apeshit over the initial ruling and just can't get my head around why...  Doesn't everyone (well us Americans anyways) realize that this was the BEST realistic tax treatment for bitcoin?  Classifying Bitcoin as currency means the majority of Americans will pay MORE in taxes.   The only thing that could have been better was a ruling of no-taxes.. and I do not consider this a realistic hope.

Sigg

Because those are kids and never done taxes in their lives?

I dont see how treating it as currency would change how bitcoin is being used except only make it alot more taxable to government.

Even though it sounds very unwieldy on the surface, I can't see how the tax treatment they've chosen so far could've been changed all that much inside current rulings.

Perhaps one day it'll justify its own categories.

The current IRS guidance creates onerous reporting requirements on anyone using Bitcoin in a transaction, including retailers and consumers.  This will negatively affect the adoption of Bitcoin as a currency, and thus negatively affect the inflow of new fiat.  The linked news would remove this problem.

So you just need a digital wallet to help you do all the accounting behind the scene, and generate a report for you at the end of the tax year

That's not entirely true.

If Bitcoin was treated as a currency, then the gains/losses would still need to be reported (and taxed) for any transaction over $200.  What's even worse is, those gains/losses would be "gain/loss on foreign currency", which is taxed at ordinary income rate instead of the long term capital gains rate (typically 15% higher tax rate).

Even though the current treatment means you have to report every single transaction instead of just those over $200, I still much prefer it because of the much lower tax rate.

Granted, if you've held your Bitcoins for less than a year, the tax rate is the same.

"just"

I love that optimism :P We barely have wallets that don't randomly destroy your money or run on iOS...

Agreed, I use too many wallets to be able to consolidate them all, and if you trade.... forget about it.
Although some accountants state that reporting requirements would only be for large stakeholders investing and trading, buying a cup of joe or tipping someone would be negligible and not require reporting.

That said, how many people use amazon and/or buy online and ACTUALLY write down all their purchases and report and pay taxes on it? I haven't seen anyone go to prison for tax evasion for buying on amazon.

That's very smart of you! Are you from US? If so, not paying your taxes is. Ot only a crime, but it is what SCUMBAGS DO! If you love your country, then don't we need money for schools? What about the road your car drives on? Or bridges? How about parks? He'll...what about that Submarine currently looking for the MH370 plane?

Listen, paying taxes suck! But it is necessary in modern societies. You can debate all you want how crooked politicians waste our tax income, or how taxes are too high...but one thing you SHOULD NOT DO IS NOT PAY YOUR TAXES! That is one of the dumbest AND least patriotic things you can do!  If you love your country, then you must pay your taxes. Period.

What a load of crap. Government Opinion Controller? Or what's Your day-work pal..? Patriots don't pay taxes to a regime that destroys their country. And thinking People ain't that happy about the government stealing their hard-earned Money anyways so.. Schools, parks etc could easily be funded With half the current taxes.


edit: 10% Of current taxes. But then government could hire you to spread government tax-propaganda online and you'd be out of work.. :o

But what if you don't love your country?

Your country still loves your tax revenue.

Then go to another country where taxes are low or non existent. Don't expect good roads, schools for your kids, police to stop criminals or your garbage to be picked up.

LOL, if married you pay 0% cap gains rate if your total income is < $70000... its a tax break for retirees.

I agree.

And the current ruling makes even less sense from the mining standpoint. Very obnoxious policy.

I consider it immoral to pay taxes. Listen to Hillary Clinton support the murder of half a million children to support the petrodollar:

https://www.youtube.com/watch?v=x4PgpbQfxgo (https://www.youtube.com/watch?v=x4PgpbQfxgo)

If you have lived in Nazi Germany, would you have helped to hide Jews? Or would you have helped the government? Adolf Eichman obeyed the laws of his country, yet is despised by most people in the world.

ha ha ha...  Sorry you are a joke.

Punchline #1:  comparing things to Nazi, Hitler, killing Jews... especially when it comes to arguing against "paying taxes".

Punchline #2:  Did you even read the title of that youtube video?  Give you a hint is wasn't Hillary Clinton...

Go bad to the kids table, come back when you can at a least read a youtube video title.

This thread just went Godwin

http://en.wikipedia.org/wiki/Godwin's_law

You aren't thinking this through. Treating bitcoins as currency for tax purposes makes it hard to spend.  If it is hard to spend.......   

Most Americans are at least familiar with how capital gains work.  How many Americans actually know how to report foreign currency transactions?  Do YOU know all the reporting requirements for foreign currency transactions?  Assuming someone wants to be legit on his taxes it is much easier and cheaper for the average american if BTC is property, not currency.  Heck, I'd wager a significant portion of tax PREPARERS aren't completely up on all the FOREX reporting requirements.

This of course assumes that the average american actually wants to correctly pay their taxes.  If not, then both our opinions are moot.

Good lord.. are you for real..  Or do you just not understand the concept of LEGALLY minimizing the taxes you pay?  Up to a certain income, capital gains are tax free.  It is very simple to live off of capital gains and LEGALLY pay 0% on your taxes.   

As giving the gov't your money is so important to you, I'm assuming you are donating to the federal government over and above your legally required tax burden?  What, you're NOT?  you SCUMBAG !!!  If you love your country, then don't we need money for schools? What about the road your car drives on? Or bridges? How about parks? He'll...what about that Submarine currently looking for the MH370 plane?

Stop the bitchfight!

Paying tax is no fun but without taxes you'll live in a hellhole for sure. Countries don't live off of donations (yet).
Everyone should pay their taxes and everyone should pay ONLY their share as defined by the law.
Minimizing your tax expenditure, within legal boundaries, should be done by everyone in my opinion. If can pay 0% tax then you should!!!

Ait, history time. What Hitler wanted was to keep Germany safe. Excessive immigration is destructive to any culture, and since jews have never had their own country (they were originally nomads) they are by definition foreigners no matter where they go. As such, getting rid of the jews was a good move for Germany. The jew issue has also been greatly exaggerated. The nazis also went after gays, gypsies and anything else that was detrimental to a lasting culture. The jews was just a small part of it, yet it has been blown up to this huge thing by revisionist historians.

The only thing Hitler did wrong was lose the war. The winner is always right. Just ask the americans.

goodness! if US citizens didnt pay taxes, the government couldnt make military aircraft, helicopters, war ships, thousands of nukes, pay troups, feed troups, fund private military organisations, and worst of all, they couldn't go bomb a bunch of countries.

BitchicksHusband is no scumbag, his taxes are not going to a good cause. If I understand correctly, it's not going to Obama care.... LOL.

you know, a mexican drug lord that was arrested was found to have So many billions of US dollars in his mansion that he could pay for the healthcare of all US citizens for 2 years.

This bullshit that we all need to pay our 15% taxes is bullshit. what we need is a government that has power to take money from the multinational corporations, and spend that money efficiently.

awww.. but a good bitchfight is just so much fun.. and I've had a rough day at work  :P

I do agree 100% with everything else you said above, however..

Sigg

Thanks for having my back.  I didn't make the laws, I'm just using it to my advantage.  It frees up more of my money to give to good causes instead of propping up the US government to go around acting like a jerk to the rest of the world.

Of course, many of you may disagree on how much of a scumbag I am when you find out what age I am retiring at.  ;)

Go fuck yourself.

In regard to all the above, we're of like mind.. and I'll be joining the retirement-age scumbag club right along with ya   ;D

Sigg

+1

Anyone that reduces the taxes they pay, either legally or illegally, has my respect.

I think it is moral and reasonable to minimize your taxes within the law.

I think it is immoral to evade the taxes that you owe.


I also think it is immoral to write the tax laws for your own personal benefit, but so is most of what the lawmakers do before they go back to their banking jobs.

omg really?  really?

How does someone having piles of cash in their house have ANYTHING to do with paying taxes as it is written in the current law?  I didn't know healthcare made us bitcoiners pay taxes...  Do our BTC miners run lab test results or something I didn't know about?  oh I know they actually calculate the tax each us US citizen is supposed to pay if there isn't a drug lord with a ton of money in his house... makes sense!  Wait I am actually confused.

So let me get this straight... the US Government should get the power to take tax money?  ummm they already do, you are complaining about it right now.

Another thing I love, apparently the government wastes money on stuff you personally do not agree with or like... well we all know every other US Citizen agrees with you.  I mean who wouldn't want Al Pacino to "say hello" to your medical bill?  I do it makes so much sense!  Give more money to the DEA to seize dollars from someone in a different country who got it because its makes more sense to get it that way then to just make it legal and collect taxes on the sales.  

This way is better cause no taxes are involved just drug cartels.

 

+1...

Do what you can to change the law... but follow the law while doing it.

no.... the US only have power to take money from the weak. cos they are governed by the multi national corporations. well actually, they are just pals... but hey. why do you put up with that? and why are you paying for bombs and SHIT health care?

The US need to catch the criminals that matter, they pick on little guys when there is a drug lord in mexico who could pay for health care for two years for the whole of America?

I will avoid paying taxes to any extent, and maybe you can ask Al Pacino nicely when the government raises taxes to 50% (as a good tax paying citizen  ;D) for a tip!

Amen.

As a Canadian I won't comment on American tax matters but here in my country, I find the income tax situation disgusting.

When personal income taxes were introduced during World War I, they were considered an emergency war measure, not a permanent means of bleeding the populace. Somewhere along the way they seem to have been accepted as an alternative to more ethical forms of taxation such as corporate taxes, estate taxes and luxury taxes.

To add insult to injury, many corporations now actually receive tax credits, i.e. welfare payments with the burden placed on anyone who's productive and non-corporate. Punishing productivity is evil beyond words.

The end result is that the working middle class  carries the biggest load, while the non-productive poor and rich get a free ride through welfare payments and tax credits respectively. This is just so wrong.

Only corporations should pay income taxes. The only personal income taxes should be on capital gains and dividends, never on wages or profits.

*** End of rant***

perhaps any of the jackasses here could just READ the article instead of flinging turds at each other? HUH??

"Stockman’s proposal would, rather, require the payment of sales taxes on all virtual currency transactions."

sales tax is usually not much, and extremely simple and linear - much better than property, and it makes BTC fungible again. in practice it could mean a 0.5% tax or something like that when buying/selling or spending BTC = low bookkeeping overhead and less volatility due to high frequency day trading

so whine, complain and insult each other while BTC rocket leaves (340 - 520 already), the market has spoken.

Our discussion was off topic. but it was still a discussion.

Sales tax is 25% in my country. On top of a ~50% income tax. And hundreds of other hidden taxes, such as a 180% tax on cars bought outside the borders.

Inevitably so...  ;D

http://i62.tinypic.com/2r55k5g.png

I still remember the warm autumn when I fell in love with my country. Leaves were falling down and all I could do was think of her. Her red lips and sweet embrace, her generous bosom feeding us all with oil, grains, warm wind of summer.

Yes, just

IRS has nothing to do with insecure wallet or Apple policy, right?

Here is the actual bill. http://www.scribd.com/doc/217067121/Virtual-Currency-Tax-Reform-Act (http://www.scribd.com/doc/217067121/Virtual-Currency-Tax-Reform-Act)

It does not levy any kind of sales taxes on Bitcoin. What is does do is treat Bitcoin as currency for tax purposes and this has two implications.
1) A $200 per transaction exemption for "personal transactions"
2) A higher tax rate equal to that of currency transactions.
http://www.law.cornell.edu/uscode/text/26/988 (http://www.law.cornell.edu/uscode/text/26/988)

The net effect of this is to encourage the use of Bitcoin for day to day transactions by eliminating the bookkeeping burden for small transactions while increasing the tax burden of those using Bitcoin as an instrument for speculation.

For governments to treat Bitcoin as currency simply makes a lot of sense and consequently this bill in on the right track.

Agreed ....lets look at the bigger picture ..Is this good for crypto ..I think its a Yes :D

The secret is not to live in the country you are citizen of. In case you are US citizen, you are f***ed.

Uh, sure... IRS has nothing to do with this.

Bolting complex accounting features on to existing apps, on the other hand, does.

OK.. so I'm now somewhat on the fence...   Did some research and confirmed the 200 exemption...  Unfortunately as far as I can tell it has stayed 200 since inception in 1997 and is not being indexed for inflation.  In today's world, it is really easy to rack up a $200 bill, so the majority of people are still going to have to track at least some of their transactions.  I still see a need for tracking to be integrated into wallets.  ( Also, coin control becomes even more important..  use the "high gain" coins for <$200 transactions, and use the "low gain" coins for >$200 )

So, as wallet tracking integration is still needed either way, we can remove that from the equation. 

It all boils down to:  capital gains (lower) tax rate on all transactions vs. standard income (higher) tax rates on just the bigger transactions.   Either way some people win, some lose.  I can't at this time say which method results in more people winning.

Sigg

I'd say it is very simple. As all bitcoin transactions are timestamped on the blockchain, a software can trace all your addresses in the past year, match with the bitcoin price record, and calculate your capital gain/loss for each time you buy a cup of coffee. For the user, it literally requires only one click to generate the report.

This silly superstition (http://www.youtube.com/watch?v=ngpsJKQR_ZE) that a single, special, flag-wavy institution has an exemption from morality (http://www.youtube.com/watch?v=u-sRbR2QQ7w) will by its very nature lead to catastrophic results (http://www.youtube.com/watch?v=dQdmsL147j0) every time. You were possibly made ignorant of how taxes really work (http://www.youtube.com/watch?v=3TpIDX49b_A) thanks to those very same public schools (http://www.youtube.com/watch?v=CMhURei8N6Q) you so dearly value. However, the current corrupt system (http://www.youtube.com/watch?v=iFDe5kUUyT0) is not a fluke. It is the nature of the beast (http://www.youtube.com/watch?v=P772Eb63qIY).

This looks like good news. I think finally the bear market is over after months of pain.

Who cares what congress does? Worst criminal terrorists in the world.
Always remember - you can't trust the goverment at all and anything they try to do with bitcoin will be for their own benefit.
Fuck the feds, fuck the irs, fuck the entire united states.  8) 8) 8) 8)

A bill needs to be approved first before it becomes a law? Right?
So it's still possible that the bill would get rejected??