You don't have a bank account.  That means that you probably don't have a house, or a credit card, direct deposit, or children, or any of the other things that are part of normal life.  You are basically a monk of a pseudo-religion.  Your experience is so far from our own that any advice that you might have is likely to be useless or even dangerous to us.

Monks cannot provide a good example to the rest of us, because if we all lived like monks there would be no families and thus no future.  All purely monastic societies die sooner or later.

April 15th is also the due date for income tax filing in the US.  Most people get a refund of a few thousand dollars.  I would not be surprised to see a minor rally over the next couple of weeks.

This is the case whether bitcoin is taxed as property or currency.  Think about it for a minute.  When you buy something that costs $200+ you need to know the basis of the coins used to pay for it.  In order to do this you need to track the basis for all of your coins, which means that you need to track every single purchase, even those of negligible value.

So the required record keeping is identical.  Just in case you didn't get it the second time (I already mentioned this in my original post) I'm going to mention it a few more times:

The required record keeping is identical whether bitcoin is classified as property or currency.

The required record keeping is identical whether bitcoin is classified as property or currency.

The required record keeping is identical whether bitcoin is classified as property or currency.

You are asking for advice on how to get handouts.

Has it occurred to you that we don't want to part with our bitcoins?  Why should we give you something for nothing?  If you want our bitcoins then you will need to offer us something tempting, something that we value more than we value our bitcoins.

I thought about buying gold several times but I never did.  The reasons?

1) The markup above the spot price was high.  Even the best places were charging more than I wanted to pay.

2) In order to sell the gold I would need to take it to a coin store.  There is no guarantee that they are going to pay me the spot price.

3) I lived in an apartment at the time.  I had lost small valuable objects when moving from one apartment to another.  I didn't want to hide my gold coin in a closet and forget it when I moved.

4) Gold isn't all that divisible from a practical standpoint.  If you want to pay minimal fees to buy and get full value when selling, it seems that you need to deal with full ounce coins or larger bars.  Investing in multiples of $1600 (that was the price of gold at the time) was hard back when I was poor.

So I bought bitcoin instead of gold.  In many situations bitcoin is superior to gold.  Gold has strengths of its own and so it will continue to be important as a way to store wealth.  However it seems that it will be secondary to bitcoin.

At some point in the future the bitcoin to gold ratio will stabilize.  Until that point, saving energy is going to flow from gold to bitcoin.  Gold is great, but bitcoin is better.

You really should talk to a tax professional, an accountant and/or a tax lawyer.  You could get in a lot of trouble if you don't.

That document assumes that you are selling the gold fairly soon, and it doesn't say what happens if a miner keeps the gold for a substantial amount of time.

My interpretation is that mined gold = income, gains on gold sold within a year = income.    So added together it makes sense that the miner is going to pay income tax.  For a miner who sells all of his gold within a year it it is practical to simply calculate the tax when he sells the gold to a processor, or when he uses the gold to pay his workers.  Either way he's going to pay tax at the income tax rate.  So it doesn't matter how that tax breaks down to income vs short-term gains vs foreign currency.  They all use the same rate in short-term situations.

How would the IRS handle a situation where, every month, the miner sells part of his gold and keeps part of it?  My interpretation (I'm speculating here) is that when he sells for the month he has to pay income tax on all of the gold that he mined that month, both the gold that he is selling and the gold that he is keeping.  The gold that he keeps would then become property with a basis equal to the current price.

This covers placer mining (similar to small-scale bitcoin mining): www.irs.gov/pub/irs-mssp/placer.pdf‎

Larger scale mining falls under the corporate tax rate and so you have to look at business as a whole, allowing deductions for equipment and other expenses, exactly the same way that the IRS allows professional bitcoin miners to handle it.

Of course talking about mining is a complete distraction, as the number of miners is small and shrinking.

Nope, I looked it up.  Miners pay income tax on what they dig up, not capital gains.  Am I the only person with access to google?  Why aren't you guys looking this stuff up?  It is all publicly available from the IRS.

Then your numbers are incorrect, because the numbers that I presented were a subset of the ones that you presented.  You agree with me and if I am wrong then you are wrong.  We're not wrong though.

I think that the answer is something simpler, at least for the US: regulators like having things to regulate.  It makes them feel important and it means that they get to hire more regulators, and promote the current regulators.  If something is banned the increased budget and prestige don't go to the regulatory agency; they go to an enforcement agency.  No regulator wants that.

Economic success is mostly genetic, with a solid dose of randomness.  There is really no way to eliminate poverty without eliminating those with the genetic disposition to poverty.

Of course they are taxed when you dig them out of the ground.  They are taxed as income, exactly the same way that mined BTC are taxed.

Mined BTC will be taxed as income whether BTC is taxed as property or currency.  There is no scenario where mined BTC won't be taxed as income.  This thread is talking about how to tax gains rather than production.

That B looks like it has oral herpes.  Simply repulsive.



Do we really want people to be repelled by bitcoin?

In two years this amount of bitcoin will be worth $1000.  Honeypots are a good idea, but you need to continually reassess how much you are keeping in yours.

How do you know that your gain was $49.30 instead of $249.30?  You have to calculate it, which means that you have to record how much you paid for those particular bitcoins.  Since you don't know which bitcoins you will spend on large purchases (which may result in a tax) vs small purchases (which won't) you are left recording how much you paid for each bitcoin, which means that you are tracking everything, presumably through software.

Keep in mind that over time the value of the dollar drops, and so this $200 exemption will start to feel like a $20 exemption.

Let's also be a bit more realistic about whether the IRS cares whether or not you report capital gains on the bitcoins that you used to buy groceries with.  No one is going to report that, and no one is going to get in trouble.


Yep.  Pretty much everyone on this forum is going to be able to buy a house with their current stash of bitcoin.  Newbies don't seem to realize that bitcoins are going to be worth tens of thousands of dollars soonish (three years?  fifteen?).


Bitcoins are "mined" instead of being produced by governments.  What else is like that?  ...gold, silver, platinum, etc...   Bitcoin is a precious metal.  Precious metals are classified as property, not currency.

Yes, which is why the idea of treating it as a currency is a horrible idea.  Wait a second... are you arguing in favor of higher taxes?  Out of spite?

This would be the case whether bitcoin was classified as property or foreign currency.  There really isn't a classification where mining would not be taxed as income.


If you tax something, you get less of it.  So taxing the people who secure the network means that the network will be less secure.

When you divest yourself of property, it is an event for the capital gains tax.  The amount that is taxable is the difference.  So if you buy at $100 and spend at $300 you have a capital gains of $200.  That $200 is taxed at the capital gains rate, which is usually 0% but sometimes 20%.

http://en.wikipedia.org/wiki/Capital_gains_tax_in_the_United_States

When you divest yourself of foreign currency, it is an event for the income tax.  Again, the amount that is taxable is the difference.  So if you buy at $100 and spend at $300 you have an income of $200.  That $200 is taxed at the income tax rate, which is usually 25% but sometimes 39.6%.

http://en.wikipedia.org/wiki/Income_tax_in_the_United_States