Could cryptocurrency holders be attacked by IRS?

[PovertyByte]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

[1715281389]

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[1715281389]

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[Dude.Lebowski]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

Short answer, yes.

Long answer, if you have money the IRS wants it b

Longer answer, Bitcoin CAN NOT be taken from you easily like your bank account.  They need a rubber hose or guns to do it.

[PovertyByte]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

Short answer, yes.

Long answer, if you have money the IRS wants it b

Longer answer, Bitcoin CAN NOT be taken from you easily like your bank account.  They need a rubber hose or guns to do it.

They can't take your BTC but if they conclude you received and held BTC rom NiceHash mining rewards lets say. Could they try to tax you in Fiat?

NEM/XEM with their full lack of privacy features now scares me. It would be nuts to hold a measley 4k USD worth of Crypto now that appreciates to 100k and lands me loads of trouble

[hilariousandco]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

Why would laws need to change? If you're not paying taxes on what you should legally owe then they can come after you in any which way they can. They might not be at the moment 'scouring blockchains' but they probably will at some point in the future, especially when they realise massive amounts of people aren't declaring their crytpo earnings as is what already seems be happening with Coinbase. You might be able to fly under the radar or avoid detection by using mixing services or masking the funds you own etc but that's not where they'll sting you. It's usually when you exchange the coins for cash that they'll want their cut and if you have a lot of money in your bank account that you can't account for then you'll have a lot of explaining to do.

https://www.forbes.com/sites/kellyphillipserb/2017/01/14/coinbase-to-irs-on-efforts-to-id-bitcoin-customers-we-have-a-suggestion/#5188add65f55

[Amph]

if they suspect an evasion coming from you they act as intended in these cases, and confiscate your assets, but usually if you keep your money i crypto, it's almost impossible for them to find out

talking about monero zcash, they are untraceable, if you keep your business private with these coins, you are safe, some people are exchanging their bitcoin with coins, because they offer better protection against the government

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

Short answer, yes.

Long answer, if you have money the IRS wants it b

Longer answer, Bitcoin CAN NOT be taken from you easily like your bank account.  They need a rubber hose or guns to do it.

They can't take your BTC but if they conclude you received and held BTC rom NiceHash mining rewards lets say. Could they try to tax you in Fiat?

NEM/XEM with their full lack of privacy features now scares me. It would be nuts to hold a measley 4k USD worth of Crypto now that appreciates to 100k and lands me loads of trouble

also...how they conclude what you said?? bitcoin is not directly taxable(i don't think pool perators are paying any tax at present), only the gain from it are, afaik, but this could have been changed over time in the USA

what make sense is that everything that go in the exchange will be watched by IRS, especially coinbase, if you stay aware from the exchange you don't need to worry

[coolcoinz]

I agree with hilariousandco here. There are only 2 ways to tax you. The first one is to tax your fiat coming from an exchange to your bank account. This is actually what you legally should add to your tax declaration.
The second one is to tax your purchases. For instance if you decided to buy a house you will have to declare it and pay due tax.
I see one way they could trace your coins that is by taking your personal data from an exchange via a subpoena and linking your exchange address to your wallet. This data might be inconclusive and I doubt it could be used in court, because an address that sends money to your exchange account doesn't have to be owned by you. It can be your employer or your friend, or your pimp
Not only they can't beyond any doubt prove which addresses you own, they can't also seize these addresses, unless you give them the keys.

[etherparty]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

If you earn BTC or any other altcoin because of work, mining, speculation on exchanges, etc you have to declare it as any other income.
If you don't do that sooner or later you may get caught, simple.

[darkangel11]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

If you earn BTC or any other altcoin because of work, mining, speculation on exchanges, etc you have to declare it as any other income.
If you don't do that sooner or later you may get caught, simple.

Caught? Doing what? Holding?
If you receive bitcoins from someone and not share that with anyone, you are perfectly safe. Nobody can prove you are the owner of the address, unless you register it somewhere (exchange, store) and the registration has all your personal details. If you decide to sell your coins for fiat you can then declare it as income and you'll be completely fine. Declaring bitcoin while the laws governing it are still being made is unwise. I don't want the government to know that I'm a libertarian interested in cryptography, holding electronic currency that could be used to finance a terrorist attack

[Qartada]

They couldn't really be attacked, they can't just take it out of your Bitcoin holdings like they can a bank because only you own that Bitcoin.  No one else does.  However, they could theoretically tax it (and they might well tax Bitcoin being taken out of an exchange).  It would be hard though, since you can always just anonymously transfer it to cash or hold it and trade between Bitcoin and USD Tether or something.

[olubams]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go anregulatedhe blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

The answer to that will be a perfect yes because as a government revenue genenating agency their motive is to get whatever to the maximum from you if you allow them and if bitcoin is regulated and laws enacted for that purpose, I am sure they will come after any individual generating income from that end...

[RodeoX]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

Why would laws need to change? If you're not paying taxes on what you should legally owe then they can come after you in any which way they can. ...

Totally. You could be jailed right now for tax evasion. The IRS goes after tax cheats. Pay your taxes and you have no legal problems. Of course it's true that laws could change and those laws could be anything you fail to fight against. 

[audaciousbeing]

I am wondering. Could laws change and eventually the IRS and whatever agency combined might go and scour all the blockchains and try to tax the shit out of everybody they presume to be holding cryptocurrency?

Privacy based coins that actually work would be safe but what about BTC its self without the use of those mixing services, current ETH, and XEM for example that has no intentions for privacy at all?

IRS will be performing its responsibility in generating revenue for the government and the moment they find it difficult to block every loop hope of revenue evasion from citizens, then they are nearing either extinction or re-organization. So if cryptocurrency will open that room of tax evasion then I see IRS declaring massive war against users and even tax you arbitrarily up to the level that you will be the one to open up on all your sources in other to reduce the tax liability.

[iamTom123]

The government thru any agency just like the IRS can get too creative to find ways to have some share of what we are earning. Tax evasion can be a serious charge and if we are earning some money via Bitcoin and we don't declare it then the government can act on that. This is exactly what the IRS is doing against Coinbase as IRS is demanding to have an access to the company's database to see those Americans who have never declared their Bitcoin.

No matter how we may proclaim that Bitcoin is anonymous and it is beyond the control of the government, the reality and truth is that the government can find a way most especially on taxing us. And making enemy with the government can be a terrifying thing.

[Qartada]

The government thru any agency just like the IRS can get too creative to find ways to have some share of what we are earning. Tax evasion can be a serious charge and if we are earning some money via Bitcoin and we don't declare it then the government can act on that. This is exactly what the IRS is doing against Coinbase as IRS is demanding to have an access to the company's database to see those Americans who have never declared their Bitcoin.

No matter how we may proclaim that Bitcoin is anonymous and it is beyond the control of the government, the reality and truth is that the government can find a way most especially on taxing us. And making enemy with the government can be a terrifying thing.

Even if the transactions of Bitcoin were anonymous, what they would want to be taxing are the conversions to fiat currency as that's what governments control and deal with.  Generally there are successful if it's into digital fiat currency (e.g. into a bank), and maybe it'll become harder if cash becomes less common due to the introduction of (perceived) improvements in banking systems.

[Amph]

The government thru any agency just like the IRS can get too creative to find ways to have some share of what we are earning. Tax evasion can be a serious charge and if we are earning some money via Bitcoin and we don't declare it then the government can act on that. This is exactly what the IRS is doing against Coinbase as IRS is demanding to have an access to the company's database to see those Americans who have never declared their Bitcoin.

No matter how we may proclaim that Bitcoin is anonymous and it is beyond the control of the government, the reality and truth is that the government can find a way most especially on taxing us. And making enemy with the government can be a terrifying thing.

Even if the transactions of Bitcoin were anonymous, what they would want to be taxing are the conversions to fiat currency as that's what governments control and deal with.  Generally there are successful if it's into digital fiat currency (e.g. into a bank), and maybe it'll become harder if cash becomes less common due to the introduction of (perceived) improvements in banking systems.

i heard here that they want to tax directly bitcoin eventually, because bitconi can already be used as a currency and those are using it like this can in thoery avoid taxation

to do this they said that they would track the transaction that go to some of the shops that accept bitcoin as a payment

i'm not entirely sure if this si true, but if they don't want people to evade taxing only when dumping for fiat is not enough...

[nu11p7r]

The government thru any agency just like the IRS can get too creative to find ways to have some share of what we are earning. Tax evasion can be a serious charge and if we are earning some money via Bitcoin and we don't declare it then the government can act on that. This is exactly what the IRS is doing against Coinbase as IRS is demanding to have an access to the company's database to see those Americans who have never declared their Bitcoin.

No matter how we may proclaim that Bitcoin is anonymous and it is beyond the control of the government, the reality and truth is that the government can find a way most especially on taxing us. And making enemy with the government can be a terrifying thing. :(

The question everybody should really be asking is not "Could" but "When" will holders be attacked by the IRS and governments in general.

I would argue the reality is that Bitcoin is not yet but instead on the verge of being beyond the control of any government.

The last sentence of iamTom123's post - "making enemy with the government can be a terrifying thing" is the cause of most participants and observers denial of reality.

Bitcoin is in a natural state of war with the government because it is a competitor in the supply of money, a business/enterprise/function which is critical to the very nature of the modern nation-state concept. Currently governments consider it to be too trivial and more about a technological idea that can be subverted or hi-jacked for their own purposes and so they are likely not yet exerting significant resources in covert or overt ways to attack. But as it grows the nation state stance is likely to change suddenly.

I believe the answer to "when" is somewhere around another 10x higher price / market cap jump for bitcoin and crypto in general. Best to prepare now for an eventual conflict instead of being scared about it. Otherwise don't get involved in bitcoin.

[iamTom123]

Of course, this is quite possible and in fact IRS is doing it now against Coinbase as it wants to get hold of data for American citizens who made Bitcoin transactions and made some profits subject for tax. The government can get so creative and what they can't be creative of they can just ask for changing some laws. The power of the government will always be there and in many cases there is nothing we can do but to really abide by the established rules and regulations. Fighting the government can sometimes be a lost case especially for ordinary guys like me. 

[RodeoX]

P.S. The IRS is not "attacking" anyone. They are going after deadbeats who want you to pay their share of the bill.

[sikke]

That actually depends on the thing you have done.
If you are holding the cryptocurrency in any kind ,but you are not withdrawing it, or converting the crypto to fiat, then you are safe.
You cannot pay the tax from something that you haven't sold, but you just own.

In the same moment when you exchange the btc ( for example ) to USD, you are obligated to pay the income tax for that transaction.
If you won't do this, then there is a possibility of IRS raid on your house, to investigate what have you done.

[Agrello]

The great thing about cryptocurrencies is that it can be stored on a usb, in your mind (remembering your passphrase) or other places - imagination is your limit so to say. Would also depend on why they would attack it? The most beautiful part if all is that you can just move countries. Businesses who are involved can and have moved to other countries that are more friendly. It is the first time we have been able to do such a thing which has shown some nations that they cannot be oppose the idea and movement, else they will loose greater capital by people leaving the nation.