ASIC Owners (or anyone with lots of FPGA): Cashing out BTC

[sgravina]

I just cashed out all my bitcoins.  I live in the United States and I'm going to pay taxes on them.  This is way easier than trying to hide the income.  I've been doing this for 2 years and paid taxes both years.  Because I run this as a business I get to deduct all my expenses.  So the tax hit is not as high as my personal tax rate.

I have relatives in jail and have seen how defending your self against prosecution can be very expensive.  Paying your taxes will probably give you the highest return.

Dude,
Just a side question.
Why did you cash all of them?
Are you in panic or?
You do not have to answer me of course. I am just trying to figure out why so many folks get obsessed and are cashing out no matter of the price?

I cashed out gradually.  One third at $71.  One third at $142.  And the rest at $236.  I cashed out because I thought the dollars were more valuable than the bitcoins.   The second sale finally made my business profitable (after two years).  The third sale is essentially a gift.  I'm using it to pay off my daughter's student loans.

I'm old and have several times in the past held assets past there bubble burst and ended up with a 90% loss.  I'm happy to have not done that again.

I would have sold much sooner than $236 but the price was going up too fast.  I have a real life and could not be watching my coins all the time.

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[loshia]

I just cashed out all my bitcoins.  I live in the United States and I'm going to pay taxes on them.  This is way easier than trying to hide the income.  I've been doing this for 2 years and paid taxes both years.  Because I run this as a business I get to deduct all my expenses.  So the tax hit is not as high as my personal tax rate.

I have relatives in jail and have seen how defending your self against prosecution can be very expensive.  Paying your taxes will probably give you the highest return.

Dude,
Just a side question.
Why did you cash all of them?
Are you in panic or?
You do not have to answer me of course. I am just trying to figure out why so many folks get obsessed and are cashing out no matter of the price?

I cashed out gradually.  One third at $71.  One third at $142.  And the rest at $236.  I cashed out because I thought the dollars were more valuable than the bitcoins.   The second sale finally made my business profitable (after two years).  The third sale is essentially a gift.  I'm using it to pay off my daughter's student loans.

I'm old and have several times in the past held assets past there bubble burst and ended up with a 90% loss.  I'm happy to have not done that again.

I would have sold much sooner than $236 but the price was going up too fast.  I have a real life and could not be watching my coins all the time.

10X dude
Makes sense good luck to you!

[firefop]

So here's the thing - you're going to have to use verified accounts at some point, and it's going to cost you some tax at some point.

Personally I'm verified at mtgox and cavirtex.

Whenever I get into the 8000 a month range just use the other. Depending on your immigration status, various laws affect you.

I do not, for example have to report income earned in another country while I'm a US resident. So I use the cavirtex first and wire into a royal bank account. Anything that goes into my US accounts I have to pay income tax on.

A couple ideas that help -

cultivate local buyers, some locals coming to you with cash to buy btc so they can go buy whatever it is on silkroad. Legally you'd still have to pay taxes on cash sales... but hey what you evade is your own business.

Buy some other store of value for btc - gold and/or silver come to mind, sure you'll get completely hosed on the markup but it's pretty much anon.


Eventually, if you can sustain your income level, you're going to have to incorporate yourself as a business - deduct hardware, maintenance, electricity & network services, pay yourself a wage you can handle paying income tax on... and let the business own all the hardware. You can 'cost of doing business' almost anything in this scenario including your own healthcare, insurance etc... and it's easy enough to grow it as your income increases... simply add some additional employees - who's job it is to have additional exchange accounts... etc. This amounts to going completely legit - and how much profit taking you can do is entirely dependent on you paying the associated tax costs and wages and whatnot (according to your local law).

The massive plus here, is that you'll have complete control over how much your business actually makes - and you always have the option of simply accumulating bitcoin that you don't cash out.

[ionux]

OP, Before you go off not paying taxes and stuff, speak to an attorney.  They are the only ones qualified to give you tax advice and not strangers on the interwebs.