The 5870s limited you to 99 per customer.  I think Vladimir had to create 5 accounts.

Oh, well that makes sense.  So you're agreeing to send first right?

You know surprisingly little about bitcoins for someone so addicted to them.  How did you come across 140?

We must DDOS Bitcoins to save them from themselves

I'm a tax professional so I can offer some advice.  Like people said 8 grand is nothing, so there is an almost 0 percent chance of you actually getting audited, depending on what else you do.  But, you can file your taxes in the proper way pretty easily without owing anything except on what you kept for yourself.  It just takes a little record keeping and turbo tax.

First, ignore the whole share issuance.  You are not a legal corporation in the eyes of the law.  You would need to file articles of incorporation with the Secretary of State for that to be the case.  So for legal and tax purposes just call it a sole proprietorship and file schedule C with your taxes.  Just say that all the money from the bitcoins people invested was sales. 

For expenses, try to keep records of every expense made for mining and keep them separate from your personal expenses.  You can deduct things like electricity and internet, although if they are not 100% for the mining you will need to come up with a allocation between personal use and business use.  If you own your house you can take all kinds of other deductions too.  The biggest expense will be the equipment, but you can write off up to $500,000 worth of equipment for tax purposes, so you can effectively treat it like any other expense.

In the end you should be able to show total sales (bitcoin investments sold for $) - total expenses = your cut.  Your cut is what you owe tax on.

What's stopping that global warming?  It was 50 degrees on Monday, in June!

Do bitcoins count as an addiction?  Is there a bitcoins anonymous yet?

No one can really tell how rational the market will be when difficulty is approaching the point where GPU mining is breakeven.  It's possibly that big miners will keep adding capacity, but it doesn't make any more sense for someone with 100 paid off computers mining to add 1 more than it doesn't for someone with zero to buy 1.  Either way that specific computer earns the same rate of payback.  If people are rational they will do a cash flow analysis on every piece of equipment before purchasing it, factoring in all direct and indirect costs, and never take a negative cash flow investment.  

However you could also get in the situation where people continuing purchasing even though they are losing money, or have the difficulty propped up by a bunch of 14 year olds who find out late about bitcoin and run their computers 24/7 at a loss because their parents paid for their electricity.

Conversely you could get in a situation where people are too risk adverse after the first shock wave to add on any more hardware (the stuff that came online in the past week or so would have been ordered during the run up to $34/BTC) and actually have GPU mining profitable for a long time to come.

The big casino resorts have lots more going for them than just the revenue from problem gamblers.  These are places with 5,000 plus rooms with average rates of up to $200 a night.  Then they have theaters, restaurants, bars, spas, etc.  I imagine problem gamblers would represent less than 5% of the total, so you could lose them and still be doing fine.  It's more about how many people can afford to spend $1,000 for a weekend getaway in the middle of a recession.

Short term leasing makes no sense to me.  Leases could be seen as a way to bet for or against the long-term movements in the value of bitcoins or in the difficulty of mining them, but over two weeks you're basically just talking about a loan paid back in bitcoins.  If you will guarantee mining 7 bitcoins over two weeks, which are currently worth $100, why would you sell it for $75? That's 33% interest in two weeks.  Go to a pawn shop if you're that hard up, otherwise wait it out and collect $100 in two weeks.

First, there is no way in this world I see the IRS letting you treat bitcoins as capital gains even for trading, much less for mining so don't worry about that.  Capital gains are given preferential treatment at the federal level and taxes at either 5% or 15% instead of between 10 and 35%, but each state can set their own tax rules.  Mine treats capital gains as ordinary income for tax purposes.  But forget that, because bitcoins aren't capital gains.

How big of a mining operation are you talking about here?  If it's less than $10,000 I wouldn't worry about the specifics too much.  Just record all your expenses including hardware and all your income from sales or trades of bitcoins.  Report it on schedule C of your form 1040.  Sales - expenses = taxable income.  If you end up losing money you can actually write it off against your normal income.

I am a tax professional and although it obviously hasn't come up in tax court yet, here is my take.  Bitcoins are not recognized as a currency or store of value yet, so it should be perfectly acceptable to treat any bitcoins you own as if they didn't exist when it goes time to file your taxes.  However, by that logic when you cash in your bitcoins for dollars you need to claim 100% of that as income.  Similarly if you trade the bitcoins for merchandise you would need to claim the fair value received as income.

Treat your mining operation as a schedule C business.  Take section 179 for all your computer equipment (it's a tax write off for 100% of the cost instead of depreciating it over its useful life).  Keep track of all your mining expenses separately from any personal expenses so you have a nice clear set of records in case the IRS comes snooping around.  If your mining is done at home it is tricky, but come up with a fair allocation for utilities for the house as a whole to allocate to your business.   If you own your home you can also take a tax write off for the depreciation on the percentage of the house used for mining.

I have lots more tips, but I tend to ramble when I'm not sure if anyone is listening so I'll stop for now.

Facts are meaningless. You could use facts to prove anything that's even remotely true.

Point taken, for now I added cliffs at the top and will simplify the details later.

Price dropped to $250 startup cost, $1 per Mhash/sec.

Mining should be more or less independent from the actual market long-term.  The amount of ghashes should go up or down in response to the current exchange rate and difficulty levels.  The only direct impact mining should have on price is when a ton of new equipment goes online in the middle of one difficulty cycle such that the 2016 blocks are used up way faster than 6 per hour, which temporarily increases supply and should suppress the price a little.  Once the difficulty adjusts to that though it goes back to normal.

The deal is now open.  The computers I have online right now have been quite stable (probably 95-98% uptime on my end) for the past 10 days.  I've had some problems with RMAs on other hardware, but that will only affect me, not the buyer.  Let me know if you have any interest.

I know it wasn't accurate, just thought the ridiculous number was funny.

LOL, estimate for next increase according to blockexplorer:

3,507,821 in 449345 seconds (5 days)

Hope that changes

Heh, maybe I should consider solo mining.