Just like on an exchange. when you pay a fee to trade. You can pay a fee to cash out to fiat. No more than  1 or 2% State and Federal.

This way it will be much less confusing and reasonable. More will comply with the tax.

And if it goes against you and money is lost. The government won't refund money due to a bad investor claiming a loss.

We know this will never happen due to the fact that anyone in government is a sold out whore. or to stupid to come up with a golden idea like this.

I suggest taking a basic mathematics course to understand the concept of decimals.
http://en.wikipedia.org/wiki/Decimal

You may also see people refer to particular fractions of bitcoins such as milli-bitcoins (mBTC), micro-bitcoins (µBTC), or nano-bitcoins (nBTC).  To better understand these denominations, I suggest reading a bit about the metric system.
http://en.wikipedia.org/wiki/Introduction_to_the_metric_system#Prefixes

0.1 BTC means one tenth of a bitcoin.
0.01 BTC means one hundredth of a bitcoin.
0.001 BTC means one thousandth of a bitcoin (also called a milli-bitcoin)
0.0001 BTC means one ten-thousandth of a bitcoin.
0.00001 BTC means one hundred-thousandth of a bitcoin.
0.000001 BTC means one millionth of a bitcoin (also called a micro-bitcoin)
0.0000001 BTC means one ten-millionth of a bitcoin
0.00000001 BTC means one hundred-millionth of a bitcoin (also called a satoshi).

It works the same way in the other direction.

10 BTC means ten bitcoins.
100 BTC means one hundred bitcoins.
1000 BTC means one thousand bitcoins.
10000 BTC means ten thousand bitcoins.
100000 BTC means one hundred thousand bitcoins.
1000000 BTC means one million bitcoins.
10000000 BTC means ten million bitcoins.

It works with satoshis as well.

1 satoshi means one satoshi (also called 0.01 micro-bitcoins, or 0.00001 milli-bitcoins)
10 satoshi means ten satoshi (also called 0.1 micro-bitcoin, or 0.0001 milli-bitcoins)
100 satoshi means one hundred satoshi (also called a micro-bitcoin, or 0.001 milli-bitcoins)
1000 satoshi means one thousand satoshi (also called 10 micro-bitcoin, or 0.01 milli-bitcoins)
10000 satoshi means ten thousand satoshi (also called 100 micro-bitcoins, or 0.1 milli-bitcoins)
100000 satoshi means one hundred thousand satoshi (also called 1000 micro-bitcoins, or 1 milli-bitcoin)
1000000 satoshi means one million satoshi (also called 10000 micro-bitcoins, or 10 milli-bitcoins)
10000000 satoshi means ten million satoshi (also called 100000 micro-bitcoins, or 100 milli-bitcoins)
100000000 satoshi means one hundred thousand satoshi (also called 1000000 micro-bitcoins, or 1000 milli-bitcoins, or 1 BTC)

How many more example of people losing coins by keeping them on an exchange do we need before people wise up?

I get it, newbs will always fall for this unless forewarned. But this is retarded. Obviously anyone who did their research would know that Vircurex was insolvent about a year ago after a supposed "hack" where they lost a lot coins.