Explain the income in bitcoin ?

[notthematrix]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

[1715247490]

1715247490

[1715247490]

1715247490

[1715247490]

1715247490

[brontosaurus]

Before getting into depth one must understand that most of the world's Tax laws consider income as taxable when it is received by you. Now this line could have two perspectives. Received could mean when you have received your bitcoins in wallet or cashed out your bitcoins and received it in bank. If you use a private key wallet there is absolutely no way your govt. can know when have you received your bitcoins. If you use an exchange then you are not anonymous as most of exchanges do KYC.

Now the tax on this income from jobs can be split into two parts. First is the tax on the amount of bitcoins at their corresponding value that day when you received them, this would be income from either business or other incomes. And the tax on the amount you have earned due to increase in price of bitcoin this can be treated as a capital gain. So these two would be taxed in this manner if you are using an exchange.

For private key wallet just cash out your bitcoin at end of fiscal year and pay taxes on it as income from business or other sources.

[carlfebz2]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

I think its just the same since you did still able to get those coins or bitcoin earnings from a job which you can still declare and I cant see that there would be a problem on that. Want to know if your government is already requiring you to have such declarations? That's too strict though. For now in my state here in my country I don't have much problem regarding on that even though it is already involving huge money but yet taxation on bitcoin earnings isn't still being imposed.

[jossiel]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

It's up to you on how you'll declare it, if your taxing ministry is obligating you to pay taxes since it is a must and you are earning so your conscience will be dictating you of doing so.

You can just declare that you are a freelancer since most of the online jobs are treated and called that way.

It doesn't matter if it is in bitcoin as long it has value and you are converting it to your local currency.

[matuson]

In order to avoid paying tax, I use online exchangers. They can be used to send the Fiat on any account without registration. In this case you will not track and you can do any in-store purchase without using your Bank account. It seems to me that bitcoin was conceived in order not to interfere with the government and therefore I consider myself free from tax liabilities.

[btc-facebook]

In order to avoid paying tax, I use online exchangers. They can be used to send the Fiat on any account without registration. In this case you will not track and you can do any in-store purchase without using your Bank account. It seems to me that bitcoin was conceived in order not to interfere with the government and therefore I consider myself free from tax liabilities.

It's depend on their government whenever they have legalize and apply tax or not.
Meanwhile my government still not legalize yet so no one forcing me to explain bitcoin as my income. They just forbid bitcoin as main transaction because bitcoin can be use for criminal things

[Hamphser]

In order to avoid paying tax, I use online exchangers. They can be used to send the Fiat on any account without registration. In this case you will not track and you can do any in-store purchase without using your Bank account. It seems to me that bitcoin was conceived in order not to interfere with the government and therefore I consider myself free from tax liabilities.

It's depend on their government whenever they have legalize and apply tax or not.
Meanwhile my government still not legalize yet so no one forcing me to explain bitcoin as my income. They just forbid bitcoin as main transaction because bitcoin can be use for criminal things

You are right it would really depend on a certain country if they do have actions when it comes on bitcoin income and now politicians on my place are now advising the citizens that they should avoid bitcoin if they dont like to lose up money and for those people who doesnt have idea on what bitcoin is for sure they would really easily believe on what those politicians say but as a bitcoin user they are just trying to lure away people since they do know the possible effects if most or majority of citizens would engage to bitcoin.

[notthematrix]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

It's up to you on how you'll declare it, if your taxing ministry is obligating you to pay taxes since it is a must and you are earning so your conscience will be dictating you of doing so.

You can just declare that you are a freelancer since most of the online jobs are treated and called that way.

It doesn't matter if it is in bitcoin as long it has value and you are converting it to your local currency.

The thing is i don't convert it in local currency ! So should i declare something in bitcoin ? It seems a bit silly to declare something you did not cash out even if it's a regulary income when you know 5000 dollars can become 1000 dollars quickly until you cash it out.

[entrepmind23]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

It's up to you on how you'll declare it, if your taxing ministry is obligating you to pay taxes since it is a must and you are earning so your conscience will be dictating you of doing so.

You can just declare that you are a freelancer since most of the online jobs are treated and called that way.

It doesn't matter if it is in bitcoin as long it has value and you are converting it to your local currency.

The thing is i don't convert it in local currency ! So should i declare something in bitcoin ? It seems a bit silly to declare something you did not cash out even if it's a regulary income when you know 5000 dollars can become 1000 dollars quickly until you cash it out.

If you don't convert it in local currency then I think you don't need to pay any tax because there is no income to declare yet. If your country do not have any applicable laws yet regarding bitcoin income then you don't need to pay any tax. Your country may have particular laws regarding fiat currency so it will only be applicable in fiat in which case you will not pay any tax if the bitcoin income you earn is not in fiat yet.

[iamTom123]

Before getting into depth one must understand that most of the world's Tax laws consider income as taxable when it is received by you. Now this line could have two perspectives. Received could mean when you have received your bitcoins in wallet or cashed out your bitcoins and received it in bank. If you use a private key wallet there is absolutely no way your govt. can know when have you received your bitcoins. If you use an exchange then you are not anonymous as most of exchanges do KYC. Now the tax on this income from jobs can be split into two parts. First is the tax on the amount of bitcoins at their corresponding value that day when you received them, this would be income from either business or other incomes. And the tax on the amount you have earned due to increase in price of bitcoin this can be treated as a capital gain. So these two would be taxed in this manner if you are using an exchange. For private key wallet just cash out your bitcoin at end of fiscal year and pay taxes on it as income from business or other sources.

You clarified this issue well enough. The difference between the value at the time when the Bitcoin is received and when it is converted to fiat money is the capital gains and one has to pay capital gain tax for that. The other tax is, of course, the tax on the income received meaning the whole Bitcoin upon receiving it. I agree that in countries like USA it would be good to declare everything and I think there is already easy-to-understand guide available online for anyone declaring and paying the appropriate tax on this. One thing is sure the government is very much enthusiastic in collecting taxes and in imposing penalties once they are aware that one is not declaring all transactions correctly BUT they are reluctant in supporting the cryptocurrency movement unlike Japan, South Korea, Taiwan and Australia. This is a one-sided kind of a situation which we hope can be corrected soon when Bitcoin is already a well-accepted and legitimized currency. If the government is very much happy promoting the legalized marijuana industry, I don't see the rational why it should not be in the forefront promoting the adoption of cryptocurrency when it can anyway imposed strict regulations if they want.

[Laland]

For me the most profitable would be mining, that is if you got the right tech in your place. It is what i am earning for right now, as the price is now increasing. It might be late but at least it is a start. Participating in services bounties and tokens for me, is just a minor earning but at least it is a good start for people who really doesnt have enough money fot mining.

[honeyb0y]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

Until ou convert it to your fiat currency then you don't need to worry about it. Once you converted it to fiat that is the only time that you can consider it as an income and that is the time that you can declare it. Unless your government already accepted crypto currency and they have regulations for it.

[soham]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

I consider my bitcoin income as actual income only when I exchange it to fiat. So I may have 1 bitcoin in my wallet and I cashed out 0.3 bitcoin to my bank account. So I will consider that 0.3 bitcoin equivalent of cash as my income and I will report it to my tax information sheet. I won't report my entire holding of 1 bitcoin because it is not actually received and infused in to economy.

So it doesn't matter how many bitcoins you earn from various sources like bounty, moderation, referral income etc. unless and until you cash it out, it can't be considered as your income as per the tax law in majority of the countries. I follow the same thing.

[Aeneas]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

I consider my bitcoin income as actual income only when I exchange it to fiat. So I may have 1 bitcoin in my wallet and I cashed out 0.3 bitcoin to my bank account. So I will consider that 0.3 bitcoin equivalent of cash as my income and I will report it to my tax information sheet. I won't report my entire holding of 1 bitcoin because it is not actually received and infused in to economy.

So it doesn't matter how many bitcoins you earn from various sources like bounty, moderation, referral income etc. unless and until you cash it out, it can't be considered as your income as per the tax law in majority of the countries. I follow the same thing.

Your'e right. But in fact (we are working in Eastern Europe) tax service can make little bit differ decision, and here we have practice of income directly from mining forgetting salary in BTC.

[notthematrix]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

It's up to you on how you'll declare it, if your taxing ministry is obligating you to pay taxes since it is a must and you are earning so your conscience will be dictating you of doing so.

You can just declare that you are a freelancer since most of the online jobs are treated and called that way.

It doesn't matter if it is in bitcoin as long it has value and you are converting it to your local currency.

The thing is i don't convert it in local currency ! So should i declare something in bitcoin ? It seems a bit silly to declare something you did not cash out even if it's a regulary income when you know 5000 dollars can become 1000 dollars quickly until you cash it out.

If you don't convert it in local currency then I think you don't need to pay any tax because there is no income to declare yet. If your country do not have any applicable laws yet regarding bitcoin income then you don't need to pay any tax. Your country may have particular laws regarding fiat currency so it will only be applicable in fiat in which case you will not pay any tax if the bitcoin income you earn is not in fiat yet.

Okay good, this is what i wanted to know, because i invest this money and don't want to cash it out yet.

But i wonder when it comes to cashing out, how it works, because we have to explain in details how we got this money, to prove it's not money laundering, but how to explain income from bounties for example ? It will be quite hard to justify, they will have to call every project

[Lancusters]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

I consider my bitcoin income as actual income only when I exchange it to fiat. So I may have 1 bitcoin in my wallet and I cashed out 0.3 bitcoin to my bank account. So I will consider that 0.3 bitcoin equivalent of cash as my income and I will report it to my tax information sheet. I won't report my entire holding of 1 bitcoin because it is not actually received and infused in to economy.

So it doesn't matter how many bitcoins you earn from various sources like bounty, moderation, referral income etc. unless and until you cash it out, it can't be considered as your income as per the tax law in majority of the countries. I follow the same thing.

This is quite logical if you earned bitcoin. Only me interested in this question. What if you bought bitcoin? In this case, you have to pay tax only on the difference between purchase and sale. It is a tax on capital gains. But how can you prove that you have spent a certain amount of money to buy bitcoin?

[darkangel11]

Your'e right. But in fact (we are working in Eastern Europe) tax service can make little bit differ decision, and here we have practice of income directly from mining forgetting salary in BTC.

Do you have a registered business? If yes then you have to pay taxes on the money you're earning and paying your employees. It's a huge risk to neglect it because as a business you have to write reports and have bills for every payment. You just can't operate without it and the authorities often perform random inspections, so sooner or later they'll come knocking.
If you are a solo miner that's not registered you're safe as long as you don't cash out. You can keep your mined coins as long as you like and be perfectly safe until you move it all to your exchange account because from that moment the coins will become associated with your ID.

In order to avoid paying tax, I use online exchangers. They can be used to send the Fiat on any account without registration. In this case you will not track and you can do any in-store purchase without using your Bank account. It seems to me that bitcoin was conceived in order not to interfere with the government and therefore I consider myself free from tax liabilities.

I haven't seen an online exchange that doesn't require you to verify before allowing you to cash out. Even if such an exchange would exist you're still sending money to a bank account that's in your name. You have to be extremely naive to think that your fiat can't be traced by your government.

[qwertyup23]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

This depends on the laws on respective countries when it comes to taxable incomes and it will also depend on the scope of each government agency. My colleague interviewed the lawyer at our BSP (Central Bank) and asked if whether bitcoin is legal and taxable. They said that here in the Philippines, they see bitcoin as property, thus it is not subject to legal tender. Also, mining bitcoin falls under the category of 'other income' making it taxable. Since I do know anyone here who mines bitcoin, I really cannot answer if how they declare it under their income tax return. Bitcoin profits are an isolated case where it varies depending on the situation given.

[SamsungBitcoin]

I think not all people are declaring income in bitcoin since this is not subject to tax i think no need to disclosed how much did you earn in bitcoin annually, but it is correct if in your country was bitcoin was already legalized and government already have law about bitcoin i think you should declare it and where your bitcoin came from. Signature campaign, bounty campaign, translation and trading that is the most earning method did by people who do not want to risk more.

[lili song]

This is a legal issue no one has been able to answer me about

If you win bitcoin with investment, it's easy to declare

What about bitcoins you earn from jobs  ( bounties, regular incomes for helping teams in moderation, etc.) ? It is a job and an income but in bitcoin, so how is it considered and declared?

Is depend from your country. For my country not legalized bitcoin yet. For me I earn from job (signature campaign) and easy to declare also.
We can do jobs and earn some bitcoin from there, I think same things like investment. But for investment, we have a risk of it.