Not Declaring Bitcoin Income

[iamTom123]

Here in my country which is now an upcoming tiger economy (though we are still classified as a third-world country), we are free to participate in Bitcoin both buying and selling as the government is treating Bitcoin just like any other foreiign money.

However, I am sure that only a very, very small fraction of us are declaring our Bitcoin income. It seems to me that the government is not that interested to get strict with individuals as long as they can tax the Bitcoin exchange provider for the service rendered.

I am then wondering the situation with other countries. Can your government really be able to track if you never declared gains made from Bitcoin transactions?

[1714999244]

1714999244

[Blocken]

Bitcoin is very trackable. But the thing is how do you decide whom to track? There is no good automated way to do it. Bitcoin is out of the purview of any country really, and should be treated that way. I wrote some about it here.

If you convert Bitcoin to fiat, pay income tax on it if your country has income tax. Simple.

Bitcoin ATM's bring up some legality concerns. Technically you are selling them for fiat, so you should also pay taxes like it's income instead of like it's a bank.

I'm in the United States. That's how it is here, as well as pretty much anywhere. It's just a question, is there income tax?

[countryfree]

Can your government really be able to track if you never declared gains made from Bitcoin transactions?

Your government, like every government in the world is monitoring all bank transactions, that's enough for now. With time and effort, I'm sure a government could also monitor the blockchain, but I guess this isn't a priority as of today. The European Union is already talking about it, though.

[audaciousbeing]

Here in my country which is now an upcoming tiger economy (though we are still classified as a third-world country), we are free to participate in Bitcoin both buying and selling as the government is treating Bitcoin just like any other foreiign money.

However, I am sure that only a very, very small fraction of us are declaring our Bitcoin income. It seems to me that the government is not that interested to get strict with individuals as long as they can tax the Bitcoin exchange provider for the service rendered.

I am then wondering the situation with other countries. Can your government really be able to track if you never declared gains made from Bitcoin transactions?

For the advanced countries, I think tracking wouldn't be as hard as it it sound but for third world countries and developing country, they have more issues to tackle than handling bitcoin or giving it attention to a high level. They will even appreciate you for declaring that little willingly rather than spending more money chasing after you to get that little from you. For you I would say it won't last long but for now, enjoy your tax free income pending the time they will be ready to face you.

[botany]

Here in my country which is now an upcoming tiger economy (though we are still classified as a third-world country), we are free to participate in Bitcoin both buying and selling as the government is treating Bitcoin just like any other foreiign money.

However, I am sure that only a very, very small fraction of us are declaring our Bitcoin income. It seems to me that the government is not that interested to get strict with individuals as long as they can tax the Bitcoin exchange provider for the service rendered.

I am then wondering the situation with other countries. Can your government really be able to track if you never declared gains made from Bitcoin transactions?

The government may not be interested in checking your cryptocurrency transactions for now, but they may not ignore it for ever. The IRS decided to go fishing into old coinbase records dating back a few years suddenly. There is no surety that your government might not do the same.

[Blocken]

Coinbase needs to be paying corporate taxes. Not the users.

If Coinbase sells you Bitcoin from their own accounts that is income they have.

If you sell Bitcoin to Coinbase that is income you have.

There is no reason for the IRS to be beyond the gateway world since taxes cannot go to protecting any basic rights within the crypto realm. They hold no purpose besides people foolishly asking the IRS to take their money.

[sohan76762]

No problem,The government may not be interested in checking your cryptocurrency transactions for now, but they may not ignore it for ever. The IRS decided to go fishing into old coinbase records dating back a few years suddenly. There is no surety that your government might not do the same.

[iram1011]

Unless you convert your Bitcoin into fiat and transfer it to your bank. Government isn't involved at all. You are taxed on the gain you made that are calculated through fiat amount. Nobody is interested in your Bitcoin movement over the internet.

[erikalui]

I convert my bitcoins to fiat and if my income (in terms of salary or interest) exceeds the taxable income, I anyways have to pay taxes and now I too pay my taxes. I have verified my exchange accounts too and hence my transactions can be easily tracked but since there is no such rule/law for bitcoin transactions, it is still not clear how much extra I would need to pay as tax. The Government in my country is still setting laws for taxes on bitcoins.

[GreenBits]

Unless you convert your Bitcoin into fiat and transfer it to your bank. Government isn't involved at all. You are taxed on the gain you made that are calculated through fiat amount. Nobody is interested in your Bitcoin movement over the internet.

Kinda. They will certainly care if you "you convert your Bitcoin into fiat and transfer it to your bank", its both the bank and the governments job to care; esp if the transaction is over a certain size. But since you can buy thing with a fiat value via bitcoin; I mean you can buy things that can easily be converted to fiat (consumer goods, precious metals), they also want you to record and report those transactions as well. Essentially, if you convert your bitcoin to any real world asset, it would need to be reported. Fiat value isn't the only measure of value that a government considers.

[gentlemand]

It depends on whether you bank it. I'm in the UK. Any unusual amounts will be reported and on top of that if they discover you're using your bank account to buy and sell they'll shut it down.

If you were all cash then I can't imagine anyone's ever going to find out. Not a great deal you can do with cash these days though.

[botany]

Not a great deal you can do with cash these days though.

That is precisely the government's fail back mechanism. A lot of people still pay their taxes, even if it is cash or crypto. The day crypto currencies start circulating in the economy (without the need for converting to fiat), the government will lose its monitoring mojo.

[Wesimon]

The government doesn't have a full control over bitcoin. And I guess the goverment cannot imply taxes on bitcoin since it has nothing to do with it. And they are not even aware of the list of people who use it. We are free and anonymous. If the government would legalize bitcoin. Probably they can have taxes in bitcoin users. But so it requires so much process.

[gentlemand]

The government doesn't have a full control over bitcoin. And I guess the goverment cannot imply taxes on bitcoin since it has nothing to do with it. And they are not even aware of the list of people who use it. We are free and anonymous. If the government would legalize bitcoin. Probably they can have taxes in bitcoin users. But so it requires so much process.

You can sell piles of your own dung and the government won't be aware of it and has nothing to with that either. If you're making a living out of selling piles of your own dung then tax is due on it. Anyone's welcome not to tell the government about it. If the government finds out they'll nail you to the wall.

[Nameless27]

I also live in a third world country and progressing right now and we do have the same situation. Our government is not implementing taxation as of now for at this moment no law is been passed about bitcoin. But we are not likely anonymous in here who do also recognized by our central banks and businesses we're opened on many stores and banks to transact. We have freedom.

[Yuhee]

Well i think because there are no employees or other terms related to it. Income also would mean it comes from the government and you have certain id to track your employment. Plus there are taxes on those. Our bank stated that they support btc as a means of transaction but i not as payment so i guess those are different. I tried stating btc as my source of income but the embassy did not accept so i have to show them my wallet and many sites to open just to give them some clarifications.

[seattletu]

Tax auditors are especially proficient at finding undeclared wellsprings of wage. The most effortless path is to just survey your bank explanations amid the period being referred to for store action irrelevant to your proclaimed wellsprings of wage. In the event that you work together on any of the enrolled trades, you will escape on your stores and withdrawals. From that point onward, the reviewer will survey your financial records to perceive what you obtained and how you paid the bill amid the review time frame and the months previously, then after the fact. Did you purchase something pleasant and after that compensation utilizing an undeclared ledger or clerk's check? Your financial balances will likewise be surveyed to decide if you have other undeclared bank or charge card accounts.

 Next, other government records will be questioned for enlistments of real buys, for example, property, water crafts, air ship or autos, and global travel. In the event that you are under scrutiny for criminal duty misrepresentation (which you may be on the off chance that you determinedly documented a wrong return), at that point your companions, neighbors, associates, and relatives might be met for extra leads with reference to how you may have discarded undeclared pay.

[abdillahzidan]

Not deciphering a bitcoin income is a good idea, even if we declare I'm sure not everyone will believe, maybe only people who understand the world of cryptocurency will believe it.

[Xenoph0bia]

Here in my country which is now an upcoming tiger economy (though we are still classified as a third-world country), we are free to participate in Bitcoin both buying and selling as the government is treating Bitcoin just like any other foreiign money.

However, I am sure that only a very, very small fraction of us are declaring our Bitcoin income. It seems to me that the government is not that interested to get strict with individuals as long as they can tax the Bitcoin exchange provider for the service rendered.

I am then wondering the situation with other countries. Can your government really be able to track if you never declared gains made from Bitcoin transactions?

I want to ask you that, what you mean by third world country ? There has been misconception among the western countries regarding third world countries. They think that all the third world countries are poor. During the cold war the countries associated with NATO were considered as First World countries; countries associated with Soviet Union were considered as Second World and those who decided to be non-aligned were considered as third world. I agree most of them are developing nations but at this moment, many third world countries economy is much stronger than many European countries, still the west is living in the past.

If we talk about the bitcoins, then Asia region is leading the overall bitcoin market and many 3rd world countries are boosting the bitcoin market. If government regulate the bitcoins then they have right to collect the tax if earned from bitcoins related business. Its new for them as well so government would take some more time to make strict law related to cryptocurrency.

[gregall]

At the moment the IRS can only monitor bank accounts. So if you never cash out, then you're good