If you don´t have a job in the US you can cash out 38000 $ worth of BTC per year without paying a single
$ in taxes. If you are content with a modest lifestyle, this amount could actually be enough to live off
Besides, you could always use a debit card that can be funded using BTC and pay at a merchant
directly. If you pay for clothes, groceries and so on using a debit card like this, the 38000 $ could
be sufficient to pay for the remaining costs like rent.
Where are you getting this? Please post a reference to the appropriate regulations. Where did you get the $38,000 amount? Even if you end up owing no taxes you still have to fill out the Schedule D and account for your capital gains and losses.
BTW using a debit card to pay for things directly in BTC does not help you as far as the IRS is concerned. When you buy something for BTC you have to account for the transaction as if you converted the BTC to cash (causing a capital gain or loss) then used the cash to purchase the item. So if you cashed in the $38K in BTC with no tax your use of the debit card would add to that, possibly pushing you over the magic $38,000 number and causing you to have to pay tax.
For example: I once bought a case of girl scout cookies using BTC so in my books I took a capital gain on the BTC for that transaction at the value of the cookies I got.