Bitcoin Forum
September 22, 2018, 12:43:14 AM *
News: ♦♦ New info! Bitcoin Core users absolutely must upgrade to previously-announced 0.16.3 [Torrent]. All Bitcoin users should temporarily trust confirmations slightly less. More info.
 
   Home   Help Search Donate Login Register  
Pages: « 1 2 3 [4] 5 »  All
  Print  
Author Topic: Has anyone sold BTC won here in sig campaigns? how does tax work?  (Read 425 times)
pereira4
Legendary
*
Offline Offline

Activity: 1386
Merit: 1052


View Profile
January 20, 2018, 05:24:17 PM
 #61

More cases of frozen funds, this time a $40000 transaction:


https://www.reddit.com/r/Bitcoin/comments/7rfwec/warning_do_not_send_any_large_sums_to_coinbase/?utm_content=title&utm_medium=browse&utm_source=reddit&utm_name=Bitcoin

Quote from: squatter link=topic=2671454.msg28504746#msg28504746
Actually, I gave a historical example: Al Capone. Read his Wikipedia section regarding tax evasion. He never got busted for racketeering; only for tax evasion. Money can be laundered; that includes cryptocurrency if necessary.

We are not Al Capone, and I suppose we are not trying to launder money because I would rather sleep at night than getting caught trying to launder bitcoins into a bank account. We are talking about keeping it legal once you decide to cash out.

Quote from: squatter link=topic=2671454.msg28504746#msg28504746
What kind of answer did you expect besides "make a good faith effort to pay your taxes?" There is no such thing as "proof" here given the lack of cryptocurrency-specific precedents, virtually everywhere in the world. I mention the IRS because I live in the US and am most familiar with US laws. The prevailing legal expectation is usually a standard of good faith. What countries are you even referring to? You never said.

Precisely because of the lack of precedents, it's safe to be paranoid. Have you or do you know anyone that has cashed out a decent amount of BTC earned in bitcointalk? How did it go? until we have this info, we are just speculating.


Quote from: squatter link=topic=2671454.msg28504746#msg28504746
And what "proof" do you have that "you aren't going to get away with it?" You asked about a question about taxes on signature campaigns, and even though all of this activity is perfectly traceable and legitimate, you continue with paranoia about "you aren't going to get away with it." Bitcoin is extremely transparent. If you are so paranoid about being associated with perfectly legal activities because they use Bitcoin.....maybe you should stop using Bitcoin. Wink

I asked about mixed coins and dead exchanges too. And like I said, we have no precedents, we don't know what we are dealing with. Maybe you think pointing to this forum is enough and they decide to fuck you up and decide it's not enough evidence, the government is totally clueless about bitcoin and they will take the cautious stance, meaning, at any doubt, they will declare that it's not enough proof.

Again, point me to a real case of people:

1) Selling coins that came from a mixed transaction
2) Selling coins that came from a dead exchange
3) Selling coins that came from signature campaign earnings


Quote from: squatter link=topic=2671454.msg28504746#msg28504746
Your logic is simply wrong. Your tax authorities are extremely unlikely to ever see the internal databases of any exchange, especially if you aren't in the US. And very few exchanges don't allow generation of new addresses at this point. How exactly are your newly withdrawn coins going to be traced back to your original coins? And more importantly, who is tracing your mixed coins anyway? Why couldn't they have been legitimately bought, as they were?


It doesn't matter what they "couldn't", what matters is what evidence you present. And if they are legitimately bought, you have the bank transaction into Coinbase with your name and ID and whatever. Now if you made some coins on a signature campaign and put them on Mintpal and trade for LTC or something then back to your wallet.. there are no traits of that, because the exchange is dead, and back then exchanges were completely anonymous, even in Poloniex I entered some fake name and location to trade because no one cared back then, you can look in this forum and everyone used fake names. This has now became a problem if I intend to sell these coins.

Quote from: squatter link=topic=2671454.msg28504746#msg28504746
I've never come across such bizarre logic. "An exchange shut down, so now any BTC I withdrew from there makes me a criminal!" If you win cash from a casino, and that casino later shuts down, are you this terrified to claim your gambling winnings?

Yes, unless you can clearly prove that the gains come from gambling on a casino, you have a problem. Also there would be the bank transactions with your name on it and the destination to this former company, with crypto to crypto there's nothing.



Quote from: squatter link=topic=2671454.msg28504746#msg28504746
Gamblers and traders keep books. Those are your tax records. There are literally no other tax records in this situation. You can either make a good faith effort to pay your taxes, or you can continue wallowing and complaining about how your are so paranoid and worried. You want experience? I've been paying taxes on altcoin trading for 4 years now. I traded on Mintpal. I paid taxes on it. Every trade is a taxable event; every position has a cost basis. Your books should line up your BTC/fiat trades and fiat withdrawals. It's really not that difficult.

If law enforcement agencies look into you for it, your coins are even clearly traceable to Mintpal, etc. You're simply being paranoid and treating your coins as worthless for no reason. If you really think those coins are simply non-fungible, then I'm happy to buy them from you for a fraction of the spot price. PM me.


How do you trade the coins back to Mintpal?

It's a mess of transactions, different altcoins, different wallets. I even did a bunch of micro trades worth satoshis. And I don't even have my trades that I did on Mintpal, I was going to save the trading history but when I went to the site the next day it was already dead, same goes for Cryptsy, how the fuck do I even report that.
1537576994
Hero Member
*
Offline Offline

Posts: 1537576994

View Profile Personal Message (Offline)

Ignore
1537576994
Reply with quote  #2

1537576994
Report to moderator
1537576994
Hero Member
*
Offline Offline

Posts: 1537576994

View Profile Personal Message (Offline)

Ignore
1537576994
Reply with quote  #2

1537576994
Report to moderator
1537576994
Hero Member
*
Offline Offline

Posts: 1537576994

View Profile Personal Message (Offline)

Ignore
1537576994
Reply with quote  #2

1537576994
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1537576994
Hero Member
*
Offline Offline

Posts: 1537576994

View Profile Personal Message (Offline)

Ignore
1537576994
Reply with quote  #2

1537576994
Report to moderator
squatter
Hero Member
*****
Offline Offline

Activity: 896
Merit: 601


STOP SNITCHIN'


View Profile
January 20, 2018, 11:44:46 PM
 #62


What does that have to do with anything? Someone wired GDAX money and they didn't credit it properly. They are apparently wiring the money back to the customer. So what?

We are not Al Capone, and I suppose we are not trying to launder money because I would rather sleep at night than getting caught trying to launder bitcoins into a bank account. We are talking about keeping it legal once you decide to cash out.

The point was that tax authorities want your income taxes, regardless of where it is derived. You are the one making the assumption that laundering is necessary. If you feel the need to launder it, you can. You've done nothing illegal; you are merely assuming that you are automatically tied to crime with no basis. And then you refuse to do anything about it. If you are so terrified of your bitcoins, sell them to me at a steep discount. If you've got enough, I'll travel internationally and pay you in your local currency (cash).

Or are you terrified of cash, too?

Precisely because of the lack of precedents, it's safe to be paranoid. Have you or do you know anyone that has cashed out a decent amount of BTC earned in bitcointalk? How did it go? until we have this info, we are just speculating.

As I said, I've been withdrawing considerable income from cryptocurrency trading for several years. That includes dead exchanges. I've earned from signature campaigns as well, although that's peanuts in comparison.

I asked about mixed coins and dead exchanges too. And like I said, we have no precedents, we don't know what we are dealing with. Maybe you think pointing to this forum is enough and they decide to fuck you up and decide it's not enough evidence, the government is totally clueless about bitcoin and they will take the cautious stance, meaning, at any doubt, they will declare that it's not enough proof.

I gave you an answer about mixed coins and dead exchanges, too.

Blockchain analysis companies (and therefore governments) acknowledge that even the vast majority of mixed coins are not illicit in nature. You, transparently, are not tied to illicit activity. If you're so paranoid, though, you really should probably stay away from Bitcoin. This kind of paranoia isn't good for your health.

You're basically taking the position that your government will seize your assets regardless of anything you do. If that's the case, you should consider changing your country of residence.

Again, point me to a real case of people:

1) Selling coins that came from a mixed transaction
2) Selling coins that came from a dead exchange
3) Selling coins that came from signature campaign earnings

Maybe you should provide cases where any of these circumstances led to asset seizure or prison, on their own? I've done all of these things over the course of years without issue. So have countless other people around here.

It doesn't matter what they "couldn't", what matters is what evidence you present. And if they are legitimately bought, you have the bank transaction into Coinbase with your name and ID and whatever.

Says who? Goods and services paid in bitcoins = illegal? Cash transactions are illegal? P2P transactions are illegal? Altcoin trading is illegal? If so, your country of residence is the problem. Consider moving.

Now if you made some coins on a signature campaign and put them on Mintpal and trade for LTC or something then back to your wallet.. there are no traits of that, because the exchange is dead, and back then exchanges were completely anonymous, even in Poloniex I entered some fake name and location to trade because no one cared back then, you can look in this forum and everyone used fake names. This has now became a problem if I intend to sell these coins.

Who cares? What possible evidence do you have that paying the appropriate taxes on what you owe isn't sufficient? You're basically saying that if you withdrew 5 BTC and eventually sold it, and paid the appropriate taxes on all fiat money that moved through the banking system, that you would have all your assets taken and maybe thrown in prison. What possible evidence do you have for that?

Yes, unless you can clearly prove that the gains come from gambling on a casino, you have a problem. Also there would be the bank transactions with your name on it and the destination to this former company, with crypto to crypto there's nothing.

That's ridiculous. That means cash transactions are completely illegal where you live. I doubt that's true.

And FYI, when I go to the casino and play cash games, there are no tax forms. I've pulled out 5 figures from the cage (cash) without the casino reporting anything to the IRS. It is my responsibility to pay taxes on my winnings. It is not illegal to transact in cash.

If it is illegal to interact with cash where you live, you should move.

How do you trade the coins back to Mintpal?

It's a mess of transactions, different altcoins, different wallets. I even did a bunch of micro trades worth satoshis. And I don't even have my trades that I did on Mintpal, I was going to save the trading history but when I went to the site the next day it was already dead, same goes for Cryptsy, how the fuck do I even report that.

That sucks, but you should have saved your trading history years ago. I paid taxes on everything from Mintpal and Cryptsy several years ago. If your tax argument is that altcoin trading = like-kind transactions, then you could hypothetically just fabricate records to explain how 1 BTC became 5 BTC. Under that tax theory, it literally doesn't matter anyway. And there is no way in hell that anybody is going to be parsing through Mintpal/Cryptsy transactions to decipher tax evasion at this point.

frmracc
Full Member
***
Offline Offline

Activity: 378
Merit: 100


Streamity Decentralized cryptocurrency exchange


View Profile
January 21, 2018, 08:25:39 AM
 #63

In the future I would like to buy some property with my BTC once it's worth a lot. Even small amounts made on signature campaigns in here could be worth a lot and may I want to diversify into real state in say 5 years or so.

I was wondering how would this be done? Im scared because we get daily news of any bank account that has to do with Bitcoin being frozen. I wouldn't like to be treated a criminal when I obtained my Bitcoin posting here... any help?

Tbh i never heard that news about locked a bank account that have a transaction with bitcoin. Luckly the government here is never do that, i always sold my bitcoins from the campaign smoothly and never had a problem.

Wow 8k upvoted, that's why i never do transaction for more than $5k on bitcoin. It's to risky if you do it all on 1 transaction.

bryant.coleman
Legendary
*
Offline Offline

Activity: 1918
Merit: 1006


https://karatcoin.co


View Profile
January 21, 2018, 01:35:21 PM
 #64

Bitcoins earned from signature campaigns and bounties count as ordinary income and they don't qualify for lower tax rates as capital gains. But then, the most important question is whether we should pay tax on those coins which are still in our wallet or not. Ideally, I would pay taxes only on those coins which I sold for fiat. But if Bitcoin is ordinary income, then we need to pay tax on all our coins, right?


  █ █████       ▄████▀▄██▀
  █ █████     ▄████▀███▀
  █ █████    ████▀███▀
  █ █████  ▄███▀███▓
  █ █████▄███▀████▀
  █ ███████▀████▀
  █ █████▀▄█████▄
  █ ███▀▄█████████▄
  █ █▀▄██ ▀█████████▄
  █ ▄████   ▀███████▀█▄   
  █ █████     ▀███▀▄████▄
  █ █████       ▀▄████████▄
                   
                    █████                   
                ▄███  █  ███▄               
             ███      █      ███             
         ▄███         █         ███▄         
       ██    ███████████████████    ██       
    ████            ██ ██            ████   
    ██             █     █             ██   
    █ █           █       █           █ █   
    █ ██         █         █         ██ █   
    █  ██      ██           ██      ██  █   
    █   ██    ██             ██    ██   █   
    █    ██  ██               ██  ██    █   
    █     █ ██                 ██ █     █   
    █     █████████████████████████     █   
    █  ███  ██                 ██  ███  █   
    ███       █               █       ███   
      ███      ██           ██      ███     
         ███     █         █     ███         
            ▀███  ██     ██  ███▀           
                ▀████   ████▀               
▀███▀
                 
██
██
██
██
██
██
██
██
██
██
██
██
██
pereira4
Legendary
*
Offline Offline

Activity: 1386
Merit: 1052


View Profile
January 21, 2018, 06:16:44 PM
 #65

...


Everything I said still applies, I don't know where you are @squatter but in countries from Europe which is where I am from, basically you are a criminal by default if you can't clearly prove the origin of the funds.

So no, you can't put any relevant amount worth of cash into a bank account without receipts that prove it was earned legally. You are delusional if you think you could get away with putting 5 figures worth of cash inside a bank account and not have the IRS equivalent here knocking on your door asking where that came from, and "I just made this from playing in the casino" without any receipts and clear trace back to the origin will not cut it.

You can't also put crypto earnings of any kind in an account without having full history of your earnings and being able to trace and report every satoshi movement including the movements inside exchanges.

About dead exchanges, unless you made a daily backup of your trades, chances are you would be unlucky and not have an updated trading history saved because exchanges die randomly.

It is only fair to be cautious and ask for precedents, and see what authorities would demand if you tried to cash out amounts that come from mixed origin, dead exchange origin, or signature campaign origin. The only clear and easy way is the usual one: buying them in an exchange where you are verified and selling them again: capital gains tax and you present the trades which are done in your name. Everything else is a grey area which im not willing to cross without having clear precedents because I don't want to get my bitcoins counterfeited.

Bitcoins earned from signature campaigns and bounties count as ordinary income and they don't qualify for lower tax rates as capital gains. But then, the most important question is whether we should pay tax on those coins which are still in our wallet or not. Ideally, I would pay taxes only on those coins which I sold for fiat. But if Bitcoin is ordinary income, then we need to pay tax on all our coins, right?

In theory yes, but the problem is, if you've been doing this for years and never reported anything... once you do want to cash out to buy a house, what can one expect?
pixie85
Sr. Member
****
Offline Offline

Activity: 658
Merit: 255


View Profile
January 21, 2018, 07:22:29 PM
 #66

Bitcoins earned from signature campaigns and bounties count as ordinary income and they don't qualify for lower tax rates as capital gains. But then, the most important question is whether we should pay tax on those coins which are still in our wallet or not. Ideally, I would pay taxes only on those coins which I sold for fiat. But if Bitcoin is ordinary income, then we need to pay tax on all our coins, right?

Bitcoin is not an ordinary income because you're unable to directly cash it out from your wallet. If I could pay my taxes in Bitcoin I'd gladly do so directly, but if i'm forced to use an exchange to convert to fiat and pay fees along the way, no thank you. Nobody will make me pay taxes from tokens that are lying on some address without my name on it and that I can't spend on anything in my country but have to use an exchange first. Next thing they'll make us pay taxes for tokens earned in computer games just because theoretically we can exchange them to money on ebay.

Samarkand
Sr. Member
****
Offline Offline

Activity: 462
Merit: 270



View Profile
January 22, 2018, 10:39:43 AM
 #67

...Nobody will make me pay taxes from tokens that are lying on some address without my name on it and that I can't spend on anything in my country but have to use an exchange first. ...

It is possible that it will not always be this way. You have to keep
in mind that the whole industry is still in its infancy and regulators
are still playing catch-up to keep up with the latest developments
in the cryptocurrency scene.

Nowadays, most ICOs require you to complete a KYC procedure. If you buy
tokens in an ICO where you are KYC verified it is entirely possible that one
day the tax agency of your country will come after the people, who participated
in the token sale and didn´t pay their taxes.



       █
      ██
     ██
   ██ ██
 █ ██ ██
██ ██ ██
██ ██ ██
██ ██ ██
██ ██ ██
██ ██ ██
   
       █
      ██
     ██
   ██ ██
 █ ██ ██
██ ██ ██
██ ██ ██
██ ██ ██
██ ██ ██
██ ██ ██
  B

          ▄▄▄▄▄▄
     ▄▄████████████▄▄
   ▄█████▀▀    ▀▀█████▄
  ████▀            ▀████
 ████                ████
▐███                  ███▌
███▌                  ▐███
▐███           ▄▄     ███▌
 ████         ▀███▄  ▐███
  ████▄         ▀███▄███
   ▀█████▄▄     ▄█████▀
     ▀▀████████████▀▀
          ▀▀▀▀▀▀
T 
Better. Quick.

Transparent.






             ▄████▄▄   ▄
█▄          ██████████▀▄
███        ███████████▀
▐████▄     ██████████▌
▄▄██████▄▄▄▄█████████▌
▀████████████████████
  ▀█████████████████
  ▄▄███████████████
   ▀█████████████▀
    ▄▄█████████▀
▀▀██████████▀
    ▀▀▀▀▀






▄█████████████████████████▄
███████████████████████████
███████████████▀       ████
██████████████      ▄▄▄████
██████████████    ▐████████
██████████████    ▐████████
██████████            ▐████
██████████            █████
██████████████    ▐████████
██████████████    ▐████████
██████████████    ▐████████
▀█████████████    ▐███████▀






                   ▄▄████
              ▄▄████████▌
         ▄▄█████████▀███
    ▄▄██████████▀▀ ▄███▌
▄████████████▀▀  ▄█████
▀▀▀███████▀   ▄███████▌
      ██    ▄█████████
       █  ▄██████████▌
       █  ███████████
       █ ██▀ ▀██████▌
       ██▀     ▀████
                 ▀█▌
Lancusters
Sr. Member
****
Offline Offline

Activity: 602
Merit: 263



View Profile
January 22, 2018, 11:42:47 AM
 #68

If you are afraid that your account will be frozen you can gradually sell your coins and keep the Fiat home. Why should you keep money in the Bank? You certainly can not earn due to the growth of prices for real money but you should choose the safe option. Then you take the mortgage and will extinguish the debt with their savings.

███▄                 ▄███           ▄▄███▀▀█▄▄                   ▄▄█████▄▄           ███▄               ███    ▀██▄             ▄██▀
█████               ▄████       ▄▄████▄█ ██ ████▄▄           ▄▄████▀▀▀▀▀████▄▄       █████              ███      ███           ███
██████             ██████      ▀▀██▄█████▄▄███▄█▀▀▀         ███▀▀         ▀▀███      ███▀██▄            ███       ▀██▄       ▄██▀
███▀███▄         ▄██▀ ███     ███▄▀███▀████████ ████       ███               ███     ███  ███           ███         ███     ███
███  ▀███       ███▀  ███    █████ █████████  █▄▀▀▀▄█     ███                 ███    ███   ▀██▄         ███          ▀██▄ ▄██▀
███    ███▄   ▄███    ███   ▀████▀▄██████▀█████████▀██   ███                   ███   ███     ███        ███            ▀███▀
███     ▀███▄███▀     ███   █▄▄▄▄███  ████████▀███████   ███                   ███   ███      ▀██▄      ███            █████
███       █████       ███   ██▀██████████▀████████████   ███                   ███   ███        ███     ███           ██▀ ▀██
███        ▀█▀        ███    ███████▀████████▀▀▀███▄█     ███                 ███    ███         ▀██▄   ███         ▄██▀   ▀██▄
███                   ███
     █  █▀█████████ ███ ███       ███               ███     ███           ███  ███        ██▀       ▀██
███                   ███
      █████▀▄▄▀█▄██▄▀▀▀▄██         ███▄▄         ▄▄███      ███            ▀██▄███      ▄██▀         ▀██▄
███                   ███
       ▀▀██▄▀▀▄███▀████▀▀           ▀▀████▄▄▄▄▄████▀▀       ███              █████     ███             ███
███                   ███
           ▀▀██████▀▀                   ▀▀█████▀▀           ███               ▀███   ▄██▀               ▀██▄
.
.TRADE, EARN & OWN THE EXCHANGE
████   WHITEPAPER    FACEBOOK    TWITTER    LINKEDIN    TELEGRAM    CRUNCHBASE   ████
|FREETRADING &
ICO LISTING
|SUPERIORTO NASDAQ
AND LSE
|US$ 29MRAISED IN
2 WEEKS
|
[]
Abubakaradam
Newbie
*
Offline Offline

Activity: 10
Merit: 0


View Profile
January 22, 2018, 02:42:43 PM
 #69

...Nobody will make me pay taxes from tokens that are lying on some address without my name on it and that I can't spend on anything in my country but have to use an exchange first. ...

It is possible that it will not always be this way. You have to keep
in mind that the whole industry is still in its infancy and regulators
are still playing catch-up to keep up with the latest developments
in the cryptocurrency scene.

Nowadays, most ICOs require you to complete a KYC procedure. If you buy
tokens in an ICO where you are KYC verified it is entirely possible that one
day the tax agency of your country will come after the people, who participated
in the token sale and didn´t pay their taxes.



In order to work well together then establish the Credibility with the Bank
Strong KYC during the event generates tokens will make it easier to work with banks and follow AML rules. Voluntary compliance in token sales seems to give a project a stamp of legitimacy. Many potential regulators seem to be open to token sales. preferably transparent especially when dealing with potential regulators. Since regulatory agencies in many large markets (eg, US, Canada and UK) are leaning to classify ICO as a security, ICO should be more proactive and adhere to AML / KYC guidelines to operate in this market.
Any business that wants to succeed in the long run, and not just take the money and run it, needs to understand the existing legal framework and ensure compliance. Legitimacy can be determined by how well the initial crypto assets and governance contracts are designed and protected.
pereira4
Legendary
*
Offline Offline

Activity: 1386
Merit: 1052


View Profile
January 22, 2018, 04:46:48 PM
 #70

Bitcoins earned from signature campaigns and bounties count as ordinary income and they don't qualify for lower tax rates as capital gains. But then, the most important question is whether we should pay tax on those coins which are still in our wallet or not. Ideally, I would pay taxes only on those coins which I sold for fiat. But if Bitcoin is ordinary income, then we need to pay tax on all our coins, right?

Bitcoin is not an ordinary income because you're unable to directly cash it out from your wallet. If I could pay my taxes in Bitcoin I'd gladly do so directly, but if i'm forced to use an exchange to convert to fiat and pay fees along the way, no thank you. Nobody will make me pay taxes from tokens that are lying on some address without my name on it and that I can't spend on anything in my country but have to use an exchange first. Next thing they'll make us pay taxes for tokens earned in computer games just because theoretically we can exchange them to money on ebay.


Yeah, but it's pretty obvious that the state is not going to care about what you think about it. You are right that since we can't even pay taxes, it shouldn't be counted as income, shouldn't be any different from virtual tokens in Second Life or poker tokens, but apparently they don't care and you must pay taxes as income, so signature campaigns for instance a repeated activity in time which would qualify as income tax, since we have not declared anything for years, my fear is that once you do you will get a big fine.

If someone has cashed out years of signature earnings (which are now worth a lot due BTC going $10k+) then talk about your experience and say exactly what info they requested and where are you from, also WHEN did you cash out and how much, it's important because I believe back then they would have cared less about details.
btc-facebook
Legendary
*
Offline Offline

Activity: 1358
Merit: 1015


View Profile
January 22, 2018, 05:25:51 PM
 #71

Luckily I can see my bitcoin earning without paying the tax as my government still forbid bitcoin but they still not make any legal policy yet !
In other side, I feel that bitcoin doesn't need to apply tax because it will broke it's decentralized itself , right

CAPTAIN MARVEL
She's Beatiful
boboyboi
Newbie
*
Offline Offline

Activity: 151
Merit: 0


View Profile
January 22, 2018, 09:42:45 PM
 #72

if you really want to deposit in the bank or buy a property using the money you get here in the forum. do not mention it in the  bank that the money you are buying for is came from bitcoin because im pretty much sure that your account will be frozen if you do that.
squatter
Hero Member
*****
Offline Offline

Activity: 896
Merit: 601


STOP SNITCHIN'


View Profile
January 22, 2018, 09:57:18 PM
 #73

...

Everything I said still applies, I don't know where you are @squatter but in countries from Europe which is where I am from, basically you are a criminal by default if you can't clearly prove the origin of the funds.

Like I said, your claim is that cash transactions are essentially illegal and that blockchain transaction history is inadequate (even though Bitcoin and altcoins are obviously used to transfer immense value). You should stop using cryptocurrency if that's your position. I'd like to see the statutes in question because you keep making these claims.

If you think that everyone "in Europe" is being treated as a criminal for cashing out of Bitcoin, then you are delusional.

So no, you can't put any relevant amount worth of cash into a bank account without receipts that prove it was earned legally. You are delusional if you think you could get away with putting 5 figures worth of cash inside a bank account and not have the IRS equivalent here knocking on your door asking where that came from, and "I just made this from playing in the casino" without any receipts and clear trace back to the origin will not cut it.

Actually, you are completely wrong. Again, I have been doing this for years and I've always consulted competent tax advisors. Qualified accountants, attorneys and the IRS agree that this is how table game income works in the US:

Quote
Casinos are not required to withhold taxes or issue a W2-G to players who win large sums at certain table games, such as blackjack, craps and roulette. It is not entirely clear why the IRS has differentiated the requirements this way; slot machines are games of pure chance, while table games require a level of skill. When you cash in your chips from a table game, the casino cannot determine with certainty how much money you started with.

Even if you do not receive a W2-G or have taxes withheld from blackjack winnings, this does not absolve you of the obligation to report what you won to the IRS. You simply do it yourself when you file your taxes for the year rather than at the casino when you claim your winnings.

You can't also put crypto earnings of any kind in an account without having full history of your earnings and being able to trace and report every satoshi movement including the movements inside exchanges.

Says who? Show me the law.

And if that's really the case, then you should read between the lines. The fact that Mintpal (for example) has no records to refute you only works in your favor. It's clear as day that billions of dollars are transacted in cryptocurrencies every day. It's also clear as day that the vast majority of these transactions are not recorded in a way that can be transmitted to tax authorities systematically.

You can either work within that context and pay the taxes you owe, or you can keep complaining about how there is no systematic government-whitelisted approach to doing that. Your choice.

About dead exchanges, unless you made a daily backup of your trades, chances are you would be unlucky and not have an updated trading history saved because exchanges die randomly.

That's unfortunate but it's your fault and just indicates that you were never serious about paying your taxes to begin with. As I said, I paid all taxes owed on Mintpal and Cryptsy several years ago.

Fortunately for you, the fact that Mintpal and Cryptsy don't exist to refute your trading records actually works in your favor. There is functionally no difference between Mintpal trading records you fabricate today, and my real trading records from 4 years ago. But you continue to irrationally go on about "every satoshi movement inside exchanges" as if tax authorities could ever determine the truth.

It is only fair to be cautious and ask for precedents, and see what authorities would demand if you tried to cash out amounts that come from mixed origin, dead exchange origin, or signature campaign origin. The only clear and easy way is the usual one: buying them in an exchange where you are verified and selling them again: capital gains tax and you present the trades which are done in your name. Everything else is a grey area which im not willing to cross without having clear precedents because I don't want to get my bitcoins counterfeited.

There are no precedents. You might wait years for clarity. This is like the meme of the skeleton waiting for the Bitcoin price to dip.

The cautious move was to consult an accountant/lawyer years ago -- and certainly when tax liabilities for the previous trading year arose. Just because cryptocurrencies are a new asset class doesn't mean you could assume that taxes didn't apply like other assets.

Quote
Bitcoins earned from signature campaigns and bounties count as ordinary income and they don't qualify for lower tax rates as capital gains. But then, the most important question is whether we should pay tax on those coins which are still in our wallet or not. Ideally, I would pay taxes only on those coins which I sold for fiat. But if Bitcoin is ordinary income, then we need to pay tax on all our coins, right?
In theory yes, but the problem is, if you've been doing this for years and never reported anything... once you do want to cash out to buy a house, what can one expect?

That means you you didn't treat it as ordinary income, which usually triggers tax liabilities in the tax year you earned it. The honest thing to do is amend your previous tax returns to declare your income from previous years. Alternatively, there are a host of options, but none of them are technically honest nor legal. And since you believe that every satoshi must be accounted for including links to exchanges with KYC, it sounds like you are between a rock and a hard place.

pereira4
Legendary
*
Offline Offline

Activity: 1386
Merit: 1052


View Profile
January 23, 2018, 06:33:36 PM
 #74

Like I said, your claim is that cash transactions are essentially illegal and that blockchain transaction history is inadequate (even though Bitcoin and altcoins are obviously used to transfer immense value). You should stop using cryptocurrency if that's your position. I'd like to see the statutes in question because you keep making these claims.

If you think that everyone "in Europe" is being treated as a criminal for cashing out of Bitcoin, then you are delusional.


Please learn to read, I said anyone putting any amount of money in a bank without a clear way to prove this money was obtained legally is a criminal, and by default, a government will think you are a criminal unless you can prove the former. Notice how I have pointed at several cases of accounts being frozen when they see they came from exchanges, it's because you have to prove that this money is legit.

And yes, cash transactions (of any relevance) are illegal, increasingly in more and more places. And no, you cannot put $200,000 worth of cash in a bank and don't expect problems unless you can prove the origin is legit clearly, same goes for a bitcoin deposit and so on, pretending the opposite is true is actual delusion.

Fortunately for you, the fact that Mintpal and Cryptsy don't exist to refute your trading records actually works in your favor. There is functionally no difference between Mintpal trading records you fabricate today, and my real trading records from 4 years ago. But you continue to irrationally go on about "every satoshi movement inside exchanges" as if tax authorities could ever determine the truth.  

This may be the case in your country (which is pretty weird, because makes money laundering trivial), but at least here you can't pretend to get any amounts of money in bitcoin you want into your bank account claiming that they are from a dead exchange's gains. Otherwise someone could sell a couple millions worth of drugs on the darknet, mix them, cash them out into your bank account and claim they are from a dead exchange's gains.

The burden of proof is on you (which is why I said "government treats you as a criminal by default"), and I doubt "it's from a dead exchange's gains" will cut it, even if it's the truth, which is why im worried about cashing out these coins, or coins which I mixed back in the day to text a mixer. Now there aren't clear traces about these coins.
gentlemand
Legendary
*
Offline Offline

Activity: 1764
Merit: 1255


Hello You


View Profile
January 23, 2018, 08:12:48 PM
 #75

The burden of proof is on you (which is why I said "government treats you as a criminal by default"), and I doubt "it's from a dead exchange's gains" will cut it, even if it's the truth, which is why im worried about cashing out these coins, or coins which I mixed back in the day to text a mixer. Now there aren't clear traces about these coins.

So this thread has been ongoing for quite some time now. What have you learnt and what are you going to do? You seem to be locked into a particular spiral of doom and nothing anyone says is talking you out of it.

CyberKuro
Hero Member
*****
Offline Offline

Activity: 700
Merit: 506


View Profile
January 23, 2018, 10:30:57 PM
 #76

It will be different in some countries which have regulated cryptocurrency and applied tax on capital gains such as the US.
But most countries do not regulate cryptocurrency yet, so people can cash out without any question regarding their income.
I have converted bitcoin into fiat currency a couple of time through a local exchange in my country and it works just fine.
But the government has tried to learn about cryptocurrency in order to regulate or ban it, this will be a disaster for bitcoiners.
pereira4
Legendary
*
Offline Offline

Activity: 1386
Merit: 1052


View Profile
January 24, 2018, 05:42:18 PM
 #77

The burden of proof is on you (which is why I said "government treats you as a criminal by default"), and I doubt "it's from a dead exchange's gains" will cut it, even if it's the truth, which is why im worried about cashing out these coins, or coins which I mixed back in the day to text a mixer. Now there aren't clear traces about these coins.

So this thread has been ongoing for quite some time now. What have you learnt and what are you going to do? You seem to be locked into a particular spiral of doom and nothing anyone says is talking you out of it.

I have learned that I still haven't seen anyone cash out a relevant amount of signature earnings (let's say above $10000) at least in a place that's relevant to me, so I will remain skeptic and just hold it and see how I go about it in the future.

Im still worried about the mixed coins that I did mix to test a mixer out years ago (years ago 1 BTC was worth like $200) and so Im worried about cashing these out then not being able to explain where they came from and getting it counterfeited. Same goes for BTW that I withdrew from dead exchanges or lacking information of the trades in any way. Im not sure if I will ever be able to cash out any of these... so I may have to stick with signature earnings and other coins in which I can clearly trace the origin, otherwise it's extremely risky to cash them out because you don't know what the hell to expect.
gentlemand
Legendary
*
Offline Offline

Activity: 1764
Merit: 1255


Hello You


View Profile
January 24, 2018, 07:08:28 PM
 #78

I have learned that I still haven't seen anyone cash out a relevant amount of signature earnings (let's say above $10000) at least in a place that's relevant to me, so I will remain skeptic and just hold it and see how I go about it in the future.

Im still worried about the mixed coins that I did mix to test a mixer out years ago (years ago 1 BTC was worth like $200) and so Im worried about cashing these out then not being able to explain where they came from and getting it counterfeited. Same goes for BTW that I withdrew from dead exchanges or lacking information of the trades in any way. Im not sure if I will ever be able to cash out any of these... so I may have to stick with signature earnings and other coins in which I can clearly trace the origin, otherwise it's extremely risky to cash them out because you don't know what the hell to expect.

Well, I've never sold any but I have spent plenty. Some of this was experimentally mixed just like you. Some of it was from sig campaign earnings from Bitmixer which may well be looked deeply down upon some day.

All of it, many thousands in total, went through Bitpay. They happily took it and I got plenty of tat in return for it. Go drip buy some gold or some race horses. No one is going to harm or kill you. Any vaguely clued up accountant will be able to join any dots that are questioned. There should be enough scraps out there to satisfy anyone.

palle11
Full Member
***
Offline Offline

Activity: 392
Merit: 108



View Profile
January 25, 2018, 06:36:56 AM
 #79

I have been selling my bitcoins earned from signature campaigns for more than a year now and never faced any problems with it. I sell them to local merchants in Localbitcoins.com and get the funds in my desired bank account and then i cash them out on ATM. There are no regulations regarding Bitcoin in my country and maybe that is the reason why i was never bothered by the bank or any authorities, but someone might have to answer a few questions if there are regulations implemented on Bitcoin in their country.

This may be ok if you are just dealing with small amount of sales, but let's say in 10 years 1 BTC is worth $1,000,000

How do you cash out $1,000,000 or any other amount near that? you can't do it through localbitcoins, you would need a million different merchants to cash out that much money.

Also there's no way to buy a house without going through the taxman. You may be ok cashing out a small amount to buy a new phone, but im talking about buying real state with bitcoin gains. In this case, you are going to need to explain the origin of your coins, and im not sure how I would explain I made some BTC posting in some internet forum, this may not be convincing to them even if it's the truth. They are too paranoid of anything bitcoin related.

This is also the area I'm looking at OP's worries - huge sum of fiat money transferred into an account, especially where it is above the stipulated amount for individual account.

Meanwhile on the other hand, I think to convince the authority about where the source of the money came from wouldn't be a difficult task, the authorities have a way of verifying facts because this forum is legitimate and some authorities are away of it themselves.

The point however is, if huge money transferred to an "unmerited" account as regarding specified amount for an individual account, it would then raise the curiosity of the government.

Sithara007
Legendary
*
Offline Offline

Activity: 1204
Merit: 1013


★YoBit.Net★ 350+ Coins Exchange & Dice


View Profile
January 25, 2018, 06:52:25 AM
 #80

Bitcoins earned from signature campaigns and bounties count as ordinary income and they don't qualify for lower tax rates as capital gains. But then, the most important question is whether we should pay tax on those coins which are still in our wallet or not. Ideally, I would pay taxes only on those coins which I sold for fiat. But if Bitcoin is ordinary income, then we need to pay tax on all our coins, right?

Bitcoin is not an ordinary income because you're unable to directly cash it out from your wallet. If I could pay my taxes in Bitcoin I'd gladly do so directly, but if i'm forced to use an exchange to convert to fiat and pay fees along the way, no thank you. Nobody will make me pay taxes from tokens that are lying on some address without my name on it and that I can't spend on anything in my country but have to use an exchange first. Next thing they'll make us pay taxes for tokens earned in computer games just because theoretically we can exchange them to money on ebay.

Whether you like it or not, the government want you to pay taxes on your signature campaign earnings and airdrop tokens. With each passing day, they are eliminating loopholes which can be used by crypto-users to avoid taxes. Very soon, we will be required to give details of our crypto-holdings. If we hide our holdings, then they will proceed with tax evasion charges.

Pages: « 1 2 3 [4] 5 »  All
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!