Are you keeping your crypto records?

[gentlemand]

It occurred to me that if I wanted to get rid of everything I'd be liable for capital gains and if The Man wanted to know the origins of those funds I'd better get my house in order as it's rather convoluted.

To those ends I've dug out all the old private keys I could find, noted forum posts for giveaways and taken screenshots of exchange histories to show to my tormentors.

Say if something like Byteball really did end up ginormous that's a lot of money for nothing coming from a mystery origin unless you have some sort of paper trail such as your forum posts or wallet backup.

Are many people here doing the same thing? It may pay off a long way down the line so it's worth a few hours of notation and tucking those things away.

[Lieldoryn]

If your savings in bitcoins, then no one can make you accountable, but if you will change your bitcoin into Fiat currency that all your transactions are received into the Bank account can be tracked. Why to do unnecessary work. Maybe you just want in the future to write a book "How I made my first million".

[btcdevil]

I am keeping tracks of my crypto records and even i am filing Income tax returns on my income from signature campaign and other sources which i am earning through bitcoin. So i am not afraid if in future it gets legal in my country.

[gentlemand]

Maybe you just want in the future to write a book "How I made my first million".

Um, no. I don't want my balls nailed to the wall if I had to cash out to finance my sex change. In this day and age you might well have to cough up details of the origin of your money. It's not sexy but that's how it is.

A couple of hours of filing might save you an awful lot of future heart ache.

[TryNinja]

To keep this kind of history I use websites like CoinTracking and KryptoTax (awesome website to include cryptocurrency in your tax statements) to keep a record on when and how much I profited from Bitcoin investments and trading. This way you have something to prove the source of my earnings if at some point I have to clarify where I'm getting money for the government.

I not only do this to secure my earnings from the government but also to keep a record of my history in the blockchain world. That way I can show my sons how I was a early bird and bought coins for a few dollars when they are now worth thousands.

[Wendigo]

No. It's a waste of time.

Origin - freelancing on the Internet.
Total amount - current wallet balance.
File tax form and get my fiat.
Happy ending.

[VC George]

No. It's a waste of time.

Origin - freelancing on the Internet.
Total amount - current wallet balance.
File tax form and get my fiat.
Happy ending.

How do you go about explaining bigger than your stated total earnings expenses in Fiat? There are real
limitations mate & we all face them while trying to stay say 90% tax free.

[HabBear]

I've been keeping records of transactions. Purchase prices, etc. Mostly for my own knowledge of what I've invested and what I've gained/lossed. But I know it'll serve me well when the Feds start screaming about stuff.

Also, you should be aware that if you use an online wallet, they're probably tracking your transactions and will instantly offer it up if their local Federal government declares they have to. Not many companies are willing to die on their sword...if only more were!

This site may be of some use to anyone interested in taxes on bitcoin: https://en.bitcoin.it/wiki/Tax_compliance

[Jherek]

It occurred to me that if I wanted to get rid of everything I'd be liable for capital gains and if The Man wanted to know the origins of those funds I'd better get my house in order as it's rather convoluted.

To those ends I've dug out all the old private keys I could find, noted forum posts for giveaways and taken screenshots of exchange histories to show to my tormentors.

Say if something like Byteball really did end up ginormous that's a lot of money for nothing coming from a mystery origin unless you have some sort of paper trail such as your forum posts or wallet backup.

Are many people here doing the same thing? It may pay off a long way down the line so it's worth a few hours of notation and tucking those things away.

It really depends on whether you are afraid of the tax department or not...

I wouldn't go to these lengths, only things like buying or selling of large amounts of bitcoin. It is a total waste of energy and time if you wanted to document everything you do and turn it into the government. Plus, you are going to sacrifice a lot of privacy. If they really wanted to know, everything is available on the blockchain. Just let them know all the addresses you used and let them figure it out, lol.

Also i wonder how the tax department is going to track people down on assets like XMR. It'll be a real pain in the ass right now.

[ActiveP]

I keep a daily spending diary to keep track of where my money goes, be it in bitcoin or Fiat.Keeping a daily spending diary is an easy way to take control over your spending and to identify some less than desirable spending habits.

Also as an added bonus, by keeping a daily spending diary, you're already halfway there in creating your own personal budget.

[pawel7777]

I keep a daily spending diary to keep track of where my money goes, be it in bitcoin or Fiat.Keeping a daily spending diary is an easy way to take control over your spending and to identify some less than desirable spending habits.

Also as an added bonus, by keeping a daily spending diary, you're already halfway there in creating your own personal budget.

Tax-wise, it's your income, not your spending what's relevant. You have to be able to prove where did you get your money from, not where you spent it.

OP: good thread and good advice. Although I doubt that, at this point, HMRC accept private keys/blockchain records as evidence, not to mention reports/screenshots from defunct exchanges, casinos etc. Still, it's better to have something than nothing.

And if you want to be 100% legit and law abiding citizen, you should declare your signature campaign earnings. In the UK, these would have to be declared as other income (you'd need to file annual tax return) rather than be treated as capital gains (even if you don't convert to fiat).

[Adbitco]

I'm not keeping any records nor did I ever think of doing so but I think I need to develop a habit of keeping my crypto records it might be useful in the future. Thanks for drawing our attention to keeping crypto record.

[Emitdama]

If your savings in bitcoins, then no one can make you accountable, but if you will change your bitcoin into Fiat currency that all your transactions are received into the Bank account can be tracked. Why to do unnecessary work. Maybe you just want in the future to write a book "How I made my first million".

Exactly the way you are talking is good but your bitcoin could be also come to low.If you change your half of bitcoins into Fiat currency then it can be best way for you.It can protect you from lose of bitcoin and also protect your current record in a market so it's better to change our half of bitcoin into fiat currency and half of bitcoin left in a bitcoin to create a records.

[pearlmen]

It occurred to me that if I wanted to get rid of everything I'd be liable for capital gains and if The Man wanted to know the origins of those funds I'd better get my house in order as it's rather convoluted.

To those ends I've dug out all the old private keys I could find, noted forum posts for giveaways and taken screenshots of exchange histories to show to my tormentors.

Say if something like Byteball really did end up ginormous that's a lot of money for nothing coming from a mystery origin unless you have some sort of paper trail such as your forum posts or wallet backup.

Are many people here doing the same thing? It may pay off a long way down the line so it's worth a few hours of notation and tucking those things away.

You doing this because of the way your country's law is structured as it relates to crypto currencies. In my own case here when it comes to capital gains shares are exempted which we can say bitcoin falls under the same category and aside that our laws does not even cover crypto currencies which means we are enjoying our tax free income until when the people saddled with the responsibilities of law making wake up and make such laws.

[squatz1]

Yep, I've made sure that just incase the government wants to come down and try to make my life a living hell they won't be able to without some sort of fight on my behalf. I have all the records of my crypto trades, investments, and activities. While it isn't much, it is nice to know that I've got everything documented in a worst case scenario.

I am keeping tracks of my crypto records and even i am filing Income tax returns on my income from signature campaign and other sources which i am earning through bitcoin. So i am not afraid if in future it gets legal in my country.

Wow, that's pretty bright of ya bud. Wouldn't want the tax man fucking ya.

[Wendigo]

No. It's a waste of time.

Origin - freelancing on the Internet.
Total amount - current wallet balance.
File tax form and get my fiat.
Happy ending.

How do you go about explaining bigger than your stated total earnings expenses in Fiat? There are real
limitations mate & we all face them while trying to stay say 90% tax free.

I file for taxes when I am ready to convert Bitcoins to fiat sent to my bank account. What is there to explain?

[pawel7777]

No. It's a waste of time.

Origin - freelancing on the Internet.
Total amount - current wallet balance.
File tax form and get my fiat.
Happy ending.

How do you go about explaining bigger than your stated total earnings expenses in Fiat? There are real
limitations mate & we all face them while trying to stay say 90% tax free.

I file for taxes when I am ready to convert Bitcoins to fiat sent to my bank account. What is there to explain?

If you convert significant amount, you should expect to be asked for the origins of your bitcoins.

And no, saying 'I've done some freelancing on the internetz' won't cut it. You could get a bit easier treatment, since cryptocurrencies are new concept, but generally - no one cares what you say, you have to be able to prove it. Otherwise money laundering would be a child's play.

And (depending on your jurisdiction), if you undertake any continuous business activities (such as freelancing), you'd be expected to register as a self-employed and be liable for corporation/income tax rather than Capital Gains tax. Makes no difference whether you take $/BTC/live stock as a payment.

[ReindeerOnMe]

It occurred to me that if I wanted to get rid of everything I'd be liable for capital gains and if The Man wanted to know the origins of those funds I'd better get my house in order as it's rather convoluted.

To those ends I've dug out all the old private keys I could find, noted forum posts for giveaways and taken screenshots of exchange histories to show to my tormentors.

Say if something like Byteball really did end up ginormous that's a lot of money for nothing coming from a mystery origin unless you have some sort of paper trail such as your forum posts or wallet backup.

Are many people here doing the same thing? It may pay off a long way down the line so it's worth a few hours of notation and tucking those things away.

I think I be doing these too, I am still a beginner so I can make my records complete. This will be a good answer for some people that might question your source of income especially when you became rich.

[Juggy777]

It occurred to me that if I wanted to get rid of everything I'd be liable for capital gains and if The Man wanted to know the origins of those funds I'd better get my house in order as it's rather convoluted.

To those ends I've dug out all the old private keys I could find, noted forum posts for giveaways and taken screenshots of exchange histories to show to my tormentors.

Say if something like Byteball really did end up ginormous that's a lot of money for nothing coming from a mystery origin unless you have some sort of paper trail such as your forum posts or wallet backup.

Are many people here doing the same thing? It may pay off a long way down the line so it's worth a few hours of notation and tucking those things away.

So basically you are worried that the taxman will be coming to haunt you that you had been trading in Bitcoins and that you did not pay your taxes, I don't think I am worried as there was no law that I had to pay taxes and I am not going to pay taxes, as simple if I wanted to, I would not buy Bitcoin. Even if we hide all the history, our IP address can be traced back to us any way to get rid of that. I keep on deleting from my mail box Bitcoins mail. That's the only thing I know.

[buwaytress]

To be honest, I haven't thought much about keeping records of origins for crypto that I obtain.

I do, however, maintain simple bookkeeping on my earnings and, when significant, my "diversification". I can't really say that while keeping a serious face, though, as the majority of my alts multiplied in value many times, but as I held next to nothing, I have several dollars worth of a lot of alts.

Simple excel sheets and a txt file are what hold all my information on crypto though. So I roughly know how much I've earned and where I keep them.