rocketloki (OP)
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November 28, 2016, 12:55:35 PM |
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As long as we keep Bicoins as btc in our account and don't exchange them to either EUR or USD will we be liable for tax at this point?
I was just wondering if somone know about it since my CPA say no.
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pawel7777
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November 28, 2016, 01:20:30 PM |
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As long as we keep Bicoins as btc in our account and don't exchange them to either EUR or USD will we be liable for tax at this point?
I was just wondering if somone know about it since my CPA say no.
Could depend on your jurisdiction and/or the type of activity, but in most cases (in my unqualified opinion) the answer is Yes. Doesn't really matter if it's bitcoins, foreign currency, or even other goods/services (received as a payment), you're still expected to pay tax on it (providing it's a taxable income), at the exchange rate/value at the time of receiving payment. Let us know what kind of earnings are you talking about and what country do you live in and maybe someone will offer you a sound advice. |
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BurtW
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November 28, 2016, 09:46:12 PM |
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If you are in the US then the IRS has ruled that Bitcoins are to be treated like stock. So if you buy Bitcoins/stock at $500 per Bitcoin/share there is no taxable event.
Holding your Bitcoin/stock is not a taxable event.
If you sell your Bitcoin/stock at a profit, let's say $1000 per Bitcoin/share then you have a capital gain of $500 per Bitcoin/share and you owe capital gains tax on the gain.
If you sell your Bitcoin/stock at a loss, let's say $400 per Bitcoin/share then you have a $100 capital loss per Bitcoin/share which can be used to offset gains elsewhere on your US tax return.
The tricky part is when you use your Bitcoins to buy something, let's say Girl Scout cookies. You owe a capital gains tax on the Bitcoins you use to buy the cookies if you have a gain on those Bitcoins at the time you buy the cookies. If you have a loss on the Bitcoins at the time you buy the cookies then you have a capital loss you can write off on your tax return.
So you have to track the date when you spend your Bitcoins also. I use the average price that day as the price at the time I spend them. I use Quicken to track my purchases, sales and use of all my Bitcoins.
Pain in the ass, yes but the regulations are pretty clear.
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iamTom123
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November 29, 2016, 01:02:01 PM |
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If you are in the US then the IRS has ruled that Bitcoins are to be treated like stock. So if you buy Bitcoins/stock at $500 per Bitcoin/share there is no taxable event. Holding your Bitcoin/stock is not a taxable event. If you sell your Bitcoin/stock at a profit, let's say $1000 per Bitcoin/share then you have a capital gain of $500 per Bitcoin/share and you owe capital gains tax on the gain. If you sell your Bitcoin/stock at a loss, let's say $400 per Bitcoin/share then you have a $100 capital loss per Bitcoin/share which can be used to offset gains elsewhere on your US tax return. The tricky part is when you use your Bitcoins to buy something, let's say Girl Scout cookies. You owe a capital gains tax on the Bitcoins you use to buy the cookies if you have a gain on those Bitcoins at the time you buy the cookies. If you have a loss on the Bitcoins at the time you buy the cookies then you have a capital loss you can write off on your tax return. So you have to track the date when you spend your Bitcoins also. I use the average price that day as the price at the time I spend them. I use Quicken to track my purchases, sales and use of all my Bitcoins. Pain in the ass, yes but the regulations are pretty clear.
Wow...it is must really be a pain in the ass. I am wondering...can the IRS really track all of these transactions or you guys just do it voluntarily inorder not to get entangled with the IRS web? I feel still lucky enough because I live in a country where tax laws are not yet that strict or implemented fully. |
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machinek20
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November 29, 2016, 02:25:58 PM |
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Currently no, but there is so many government already try to make bitcoin regulation and they will tax bitcoin soon, as you can see for the us the irs already want to audit and supervise the bitcoin transaction, but for the other country it hasn't been regulated but it just the matter of time
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MainstreetLP
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November 29, 2016, 07:55:24 PM |
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Depends on your jurisdiction, I know in Canada you do need to pay tax on bitcoin earnings or as income.
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Arcteryx
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November 29, 2016, 09:42:15 PM |
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I would think you only have to declare how much you have made using bitcoin is if it's worth is more than $2000. Then they will care about collecting taxes on that. If it is an amount below $250 that they have to collect then I do not think they will bother. Cause it will cost them more than that $250 to pay someone to call you or come to your house to harass you to pay the taxes in the first place.
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deadsilent
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November 30, 2016, 05:21:24 AM |
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Thats depend on what is your doing for earning. I think if you have big business like exchange, i think they will charge you for that. But if you are earning small amount only. I guess they wont charge you with tax. Besides, bitcoin is anonimous. They dont know you or even trace because of its anonimity. So you are safe with the taxes. Dont worry about it.
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sportis
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November 30, 2016, 08:42:18 AM |
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As long as we keep Bicoins as btc in our account and don't exchange them to either EUR or USD will we be liable for tax at this point?
I was just wondering if somone know about it since my CPA say no.
Taxation of every country is different. Also is different the legislation on bitcoins usage. But suppose I exchange dollars to euros. Then these euros to GBP and at last these GBP back to dollars. Do I pay taxes? No. So why do I pay for these bitcoins I bought from exchange market? Taxes are levied to income and not to currency |
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Blackshadow007
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November 30, 2016, 06:36:10 PM |
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I guess it depends on Country Jurisdiction .. For India what i learned that we need to pay Tax for Fiat currency as Capital gains .. although its still not regulated by Govt. in India .. But soon i guess Govt. will adapt it .
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olushakes
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December 01, 2016, 06:05:28 AM |
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Over here, I dont pay tax even for income that have been covered by some laws of the land there is still a way to avoid it which is largely due to the limitation in the machineries to effect the implementation not to talk of Bitcoin that we so not even have any law in that regard. This might not be general to all countries but still when there is no law, there is no sin.
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HashZilla
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December 01, 2016, 04:46:15 PM |
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Depends on your jurisdiction, I know in Canada you do need to pay tax on bitcoin earnings or as income.
How do you know this? |
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CraigWrightBTC
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December 01, 2016, 05:01:57 PM |
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Depends on your jurisdiction, I know in Canada you do need to pay tax on bitcoin earnings or as income.
Exactly, depend on the rules on every countries and i think on America they must be pay taxes to government soon, especially costumers of coinbase because their data had been taken by IRS and it is mean will there are taxes for bitcoin's usage or owning of bitcoins on there. |
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kryptqnick
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December 01, 2016, 08:00:06 PM |
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I think that if we want to obey the rules and everything then we have to, because there are no exceptions about taxes and earnings. However, I think it would be something hard to do in many countries. So many burocratic stuff is waiting for you even if you want to give money. So, I suppose if btc becomes recongnised by the countries we'll pay but not now.
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fiscorcle
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December 01, 2016, 10:54:29 PM |
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You don't need to pay for bitcoins earnings because you do not need to declare that as part of your whole yearly income.
Unless you make more than $10,000 worth in selling bitcoins then I would not really worry about paying taxes on it then.
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ethereumhunter
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December 01, 2016, 11:46:08 PM |
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As long as we keep Bicoins as btc in our account and don't exchange them to either EUR or USD will we be liable for tax at this point?
I was just wondering if somone know about it since my CPA say no.
we don't have to pay any tax if we keep our bitcoin in our account, but if there is any regulations for some people from the other country that should pay the tax, so we must obey it. i think its not many government will make their citizen to pay any tax for keep bitcoin in ther wallet or their account. maybe if canada make regulations to pay the tax, and you live in that country, so better you pay the tax if you don't want to get in jail. |
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CraigWrightBTC
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December 02, 2016, 04:59:29 PM |
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As long as we keep Bicoins as btc in our account and don't exchange them to either EUR or USD will we be liable for tax at this point?
I was just wondering if somone know about it since my CPA say no.
we don't have to pay any tax if we keep our bitcoin in our account, but if there is any regulations for some people from the other country that should pay the tax, so we must obey it. i think its not many government will make their citizen to pay any tax for keep bitcoin in ther wallet or their account. maybe if canada make regulations to pay the tax, and you live in that country, so better you pay the tax if you don't want to get in jail. Uncertainties surrounding the use of Bitcoin and other cryptocurrencies be put to rest. In a document published on November 29, 2016, the Russian Federal Tax Service finally took position on the legality of use and Bitcoin transactions. The document explicitly states that there is no legal prohibition on cryptocurrencies. |
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canah17
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December 11, 2016, 02:02:08 PM |
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As long as we keep Bicoins as btc in our account and don't exchange them to either EUR or USD will we be liable for tax at this point?
I was just wondering if somone know about it since my CPA say no.
Yes! but i don't really know about your country it really depends on what your country wants tax in exchanging bitcoin but in my country their is one machine that if you exchange your bitcoin to real money you ain't got any single cent's takin away from you because its just free if you exchange it i don't know to they really have profit from it but i am really happy that one in my country that doesn't accept tax but in your case its hard to cash out bitcoin you have tax its really a default in your country i think that the things you do with bitcoin has a tax for you to pay if you buy stuff from the internet still you have tax but still its not big of a deal to pay tax man..  just do what you have to do and don't be scared of it but my suggestion is saved up many btc as you can save in your account then that moment you will be rich if you hate tax |
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coolcoinz
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December 11, 2016, 10:36:06 PM |
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Bitcoin transactions are not taxable at the moment. Even if you gamble or trade on exchanges you are not obliged to report anything.
A good idea is to only spend your coins on goods and services and never turn them into fiat.
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Dmitry.Vastov
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December 12, 2016, 06:53:04 AM |
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I think there is no particular law which is the government is able for impose tax to bitcoin. Besides bitcoin is anonimous. They cant trace or identify the person whos using bitcoin for any business transactions. But if you use local currencies, thats a different story. Hope they will not gonna impose tax on bitcoin in the future. As long as you did not exchange your btc to money. You are safe from taxes.
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