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Author Topic: US Tax Return Tips (when using Bitcoin)  (Read 1370 times)
Qoheleth
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March 09, 2013, 02:30:13 AM
 #1

I got into Bitcoin in December of 2011 - just around the time the price was at its nadir. Since then, I've mined, speculated, and bought and sold BTC-denominated goods.

And now, I'm finding myself filling out my tax return for 2012, and having to manually go through all these transactions so that TurboTax can calculate everything properly and send it off to the IRS.

I know the basics - translate BTC income to the dollar value from when you got the coins, and then when you spend it, count the price gap as capital gains/loss. But to do so is... quite a chore.

Has anyone written any tools to automatically generate this information from the transaction history on a list of addresses? Or, alternatively, found any other ways to make the process easier and less painful? It'd be a big help, if so.

If there is something that will make Bitcoin succeed, it is growth of utility - greater quantity and variety of goods and services offered for BTC. If there is something that will make Bitcoin fail, it is the prevalence of users convinced that BTC is a magic box that will turn them into millionaires, and of the con-artists who have followed them here to devour them.
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Stephen Gornick
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March 09, 2013, 03:01:37 AM
 #2

Has anyone written any tools to automatically generate this information from the transaction history on a list of addresses? Or, alternatively, found any other ways to make the process easier and less painful? It'd be a big help, if so.

Infinity PFM (Personal Finance Manager) can read transactions from the Bitcoin.org client, apparently:

 - http://launchpad.net/infinitypfm

Unichange.me

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Severian
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March 09, 2013, 03:23:20 AM
 #3

If you feel a need to pay taxes, I have another suggestion.

Figure what you owe on taxes. Get a USPS money order from the Post Office and anonymously send it to:

Quote
Attn Dept G
Bureau of the Public Debt
P. O. Box 2188
Parkersburg, WV 26106-2188

You can write a check payable to the Bureau of the Public Debt, and in the memo section, notate that it's a Gift to reduce the Debt Held by the Public.

treasuryhunt.gov/govt/resources/faq/faq_publicdebt.htm#DebtFinance

Moral and legal obligations to pay taxes on bitcoins are up in the air but I'm certainly no lawyer. My own opinion is that no one should send them a dime until they learn to manage what they already have.  Wink
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March 11, 2013, 02:08:04 AM
Last edit: March 15, 2013, 12:18:27 AM by whitenight639
 #4



Moral and legal obligations to pay taxes on bitcoins are up in the air but I'm certainly no lawyer. My own opinion is that no one should send them a dime until they learn to manage what they already have.  Wink

+1,0000000000000000

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Sage
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March 12, 2013, 06:18:04 AM
Last edit: March 12, 2013, 07:09:43 AM by Sage
 #5

If you feel a need to pay taxes, I have another suggestion.

Figure what you owe on taxes. Get a USPS money order from the Post Office and anonymously send it to:

Quote
Attn Dept G
Bureau of the Public Debt
P. O. Box 2188
Parkersburg, WV 26106-2188

You can write a check payable to the Bureau of the Public Debt, and in the memo section, notate that it's a Gift to reduce the Debt Held by the Public.

treasuryhunt.gov/govt/resources/faq/faq_publicdebt.htm#DebtFinance

Moral and legal obligations to pay taxes on bitcoins are up in the air but I'm certainly no lawyer. My own opinion is that no one should send them a dime until they learn to manage what they already have.  Wink

+1,0000000000000000

What, are you kidding me here?

Of course you should work diligently to calculate to the very penny any profits.  Get one thing wrong and you go to jail.  And if you have any doubt, call the IRS yourself.  But know if they give you bad advise, and you follow it you still go to jail.  Yet, know the rules can change at any moment retroactively, and with a tax code larger then a stack of Bibles to the ceiling, sleep well at night knowing all those rules are in perfect sync...

...You could of course never be caught in the trap of following to the letter one part of the code, and not be in direct violation of another.

When you sign that yearly confession form, under penalty of perjury that everything is accurate an honest, sign it with full confidence knowing it follows to the letter tax code that could never by contradictory...  

...You're certain of that, you've hired the best "experts".  They couldn't possibly be wrong.  Your fifth amendment against self incrimination is fully and completely intact.

Then of course, send it off dutifully to the private collection agency of the private Federal Reserve.  Knowing your wealth will only be used in ethical, moral ways to further the cause of freedom and improve the lives of Americans.

If the Federal Reserve sees fit to send your wealth off to foreign banks, know it is for your own good.  They, being the experts, know better then you. And will always act in your best interest.

If it is used to strengthen and expand the TSA, with checkpoints at every corner so be it.  We need them to keep us safe.  

If it is used to bomb a few sovereign countries, know those were bad guys.  They had to go.  

If it is used to carpet the USSA with drones with authority to kill US citizens, sleep at night knowing they know who deserves to live and who should die.

And when you drop that yearly confession into the mailbox, sleep well at night knowing you're safe.  You dutifully complied.  They won't come after you.  You're not responsible what happens with that wealth after that. No blood could possibly be on your hands.  You had nothing to do with those that are enslaved and killed using your wealth (aside from enabling it).

Always remember, you're a US citizen.  You were born on US soil, and such you are someone else's property.  Never question that!  


P.S...

"You assist an evil system most effectively by obeying its orders and decrees.
An evil system never deserves such allegiance.
Allegiance to it means partaking of the evil.
A good person will resist an evil system with his or her whole soul."

Mohandas Karamchand Gandhi
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