How do I avoid tax on crypto

[Biscutard]

If I make money on crypto currencies. How do I avoid as much tax as possible?

One simple way you can reduce your tax liability as much as possible is by declaring income as less as possible. The less amount of income you will declare less will be the tax. You can do this by not bringing in your funds on places where you have complied in with KYC requirements. Moreover what you can do is make most of your expenses payment directly using cryptocurrencies which too will make tax burden less. Rest depends upon the laws prevalent in your area.

A wise decision i guess if their country is not so fund of looking always at your bank account. I would not put my money on any banks if my plan is to pay less taxes because one day they might find out your transaction and will might seize your account or froze it. I'd rather hide my money under my bed(lol) if the government was always watching you. 

[1714789637]

1714789637

[Paractor]

Not everywhere cryptocurrency is even recognized enough to be taxed because the government at these countries do not even view it as a verified sense of legal tender.
After they do then they will regulate it and will have its own little box on your annual tax form to fill out the amount that you made using it for the year.
Until that time just enjoy using it not to be a tax evader.

[theCoinMaestro]

It is not a good idea to avoid paying your taxes if the law says so. You may be able to get away with it for a while but the troubles you'll have to go through if you get caught are just not worth the few dollars that you've stashed. While moving to another country where laws are easier to circumvent compared to where you came from is an option or there are no taxation on bitcoins in that place at all, doing such a move for the sake of avoiding taxes is quite a big price to pay unless you earned billions through your cryptocurrency investments. But by then, you wouldn't actually be in this forum since you can now hire a team of lawyers to do the thinking for you just like what big multinationals do.

[chenbo*)]

For those who are planning to break the law in relation to cryptocurrencies, this story from Time magazine re Jason Klein may be a good read - http://time.com/5161663/bitcoin-sting-jason-klein-crypto-irs-money-transmitter/.

[BUK2016]

If I make money on crypto currencies. How do I avoid as much tax as possible?

Op, the only way in which you can avoid paying tax from your bitcoin and crypto currency earning is for to relocate from your current country to country where taxes are not paid on crypto currency related activities such as Nigeria. 

[Shamie1002]

If I make money on crypto currencies. How do I avoid as much tax as possible?

Simple
1. Move to a country that has 0 taxes or lower taxes on gains made from crypto trading.
2. Sell your coins for cash directly in person, then stash the bills under the mattress.
3. Hire a pretty good lawyer specialized in this....

Depending on which country you live in you might get away with the second option...or end up in jail.

It would also be nice if you would tell us where you're from...
Since it's one thing if you live in the US or Moldova.

I would have given you merit if I have some left.


The idea is very much precise.

I do agree that is will be depending on the country you are staying and if it will be upholding the taxes for bitcoins. Government will find ways to deduct fees and taxes through technology too. Like for an instance, here in our country, wallets are deducting fees in transacting through remittances.

Upfront transactions, or user to user is quite helpful too.
No fees and you can sell them freely.

[richardsNY]

Op, the only way in which you can avoid paying tax from your bitcoin and crypto currency earning is for to relocate from your current country to country where taxes are not paid on crypto currency related activities such as Nigeria.  

How do you know that crypto doesn't get taxed in Nigeria? Even if it was like that, with more and more regulations being enforced globally, things might change rapidly, especially so when it concerns taxes on cryptos. And then it also depends on what category they place crypto in. In Japan for example, you'll end up paying 55% in tax when it comes to amounts over $350k in their own fiat currency. In the US there are states where the property tax rates are insanely low, but on top of that you will also have to pay state tax, welfare tax, etc. If you calculate all these different tax levels, you'll come to a tax figure close to 40-50% in certain states. Crypto is a cash cow for the government, that's a fact.

[jhongzjhong]

If I make money on crypto currencies. How do I avoid as much tax as possible?

Simple
1. Move to a country that has 0 taxes or lower taxes on gains made from crypto trading.
2. Sell your coins for cash directly in person, then stash the bills under the mattress.
3. Hire a pretty good lawyer specialized in this....

Depending on which country you live in you might get away with the second option...or end up in jail.

It would also be nice if you would tell us where you're from...
Since it's one thing if you live in the US or Moldova.

I would have given you merit if I have some left.


The idea is very much precise.

I do agree that is will be depending on the country you are staying and if it will be upholding the taxes for bitcoins. Government will find ways to deduct fees and taxes through technology too. Like for an instance, here in our country, wallets are deducting fees in transacting through remittances.

Upfront transactions, or user to user is quite helpful too.
No fees and you can sell them freely.

You are right if you do not want to pay the tax fee you can ask for your acquaintance that close to you to buy or to exchange your bitcoin into cash freely. You can't avoid paying taxes especially when you cash out you bitcoin into cash you must have to pay in remittance that where you get your money. Nobody exempted when it comes paying taxes because when getting money you need to pay for them.

[superjeyy]

I don't think it's a good idea for you to keep hiding from your taxes due to your crypto. Since you're asking this, I am assuming that your country established regulations about cryptocurrency to which is why it is being taxed. With that being said, you have a responsibility to fulfill. Avoiding your tax would just lead to no good. Somehow and in some way, the government would find out and would even burden you with even more fees or penalties to pay. You're lucky that crypto is not banned in your country, so be a good citizen and do what you have to do. You wouldn't want to face worse situations just because you're avoiding a law that would actually lead the the betterment of your country.

[Ghondronk]

If you say, a wealthy businessman in Germany who wants to evade taxes, or a smuggler of illegal drugs, or a brutal ruler, then the means used to evade taxes and conceal the origin of money are very similar.

[warrior333]

There is only one way to avoid paying taxes. You need to abandon the use of Fiat. I don't know if you're ready for this. Doubt. There is a way to change bitcoins to cash without using a Bank account. But this method contains great risks. I'm not sure you're not going to be a fraud victim. Sometimes robbers for that kind of money can even kill.

[onrise]

If I make money on crypto currencies. How do I avoid as much tax as possible?

Op, the only way in which you can avoid paying tax from your bitcoin and crypto currency earning is for to relocate from your current country to country where taxes are not paid on crypto currency related activities such as Nigeria. 

That is one of the option is to create a setup or register a company outside where their is not taxation. Another thing is that you can split the investment between your family members  or whose income is very less so that the tax burden would reduce drastically. Total avoidance of tax could bring you in a legal trouble.

[berrymenalo]

If I make money on crypto currencies. How do I avoid as much tax as possible?

Bitcoin is a currency, not some solution to avoid paying taxes. The moment when people start using Bitcoin or any other

Crypto currency as a method to avoid paying taxes, then the government will step in and ban it. I would much rather pay the

taxes and be done with it, than sleeping with open eyes, waiting for the Police to raid my house in the middle of the night.

That is no way to live your life... rather pay those taxes.  

Crypto is not a currency but i believe and its more of a commodity that needs to be regulated. It sucks when the government will taxed everything but as a citizens we must know our obligations and what is our role in the society. Lets not forget to help our government to grow, because if we hate taxes it can be a hindrance of our crypto growth.

You're one of the first people I've heard agree with me about this! My thoughts are slightly different in that I think cryptos can be broken up into three classes: (1) currencies (bitcoin; monero; zcash; ltc; ripple; other 'store of value' coins); (2) commodities (ETH; some other ones; anything that gets 'consumed' when using the platform; and (3) utility (factom; storaj; espers; etc.; tokens that don't get destroyed and serve some sort of functional purpose but which are built upon a different cryptos platform).

Ideally, in this system, btc and the like would be classified and taxed as foreign currencies, ETH and the like would be taxed as commodities (60/40 rule), and utility tokens would continue to be taxed like property.

Too bad the IRS will never get their shit together enough to figure this out!

[TrumpD]

Paying taxes is a legal obligation, and you shouldn't avoid it. You are benefiting from various governmental interventions for you to earn crytpo, be it electricity tariffs, super good internet, etc.  So you are benefiting from this, in turn you need to return the favor in taxes for this "peaceful earnings to continue". The only thing I can figure out is how you can stay anonymous if you declaring taxes from crypto. Because most people want to stay anonymous via crypto involvement in the face of the government.

[Hammad zakria]

Purchase Cryptocurrency With a Retirement Account
A lot of people understand that retirement accounts are like IRAs and 401Ks or ROTH investment options. They give tax breaks that help people save money for retirement reasons. And, many cryptocurrency investors also think they can avoid paying taxes because their digital currencies are making money through accounts set up for retirement. But this is a process that is not as easy as one may think.

When an American citizen or resident wants to by cryptocurrencies through an IRA, they need to first transfer funds off shore. They also need to setup an LLC that operates in a country with zero taxes. The company that is offshore will need to then open and bank account offshore that works with a digital currency and wallet to complete the transactions on the behalf of the individual.

It sounds complicated and that is because it is, you need to have help from an attorney in the United States and a foreign counterpart in the country that you’ve chose for hosting your IRA. There a lot of legal fees as well that will start to build up fast. And without understanding the way that transactions work internationally, there’s a chance it will not work out. If the person hired to set up the IRA chooses to bail out and run, you can’t really do much about it.

The complex nature of the situation and potential for fraud are only the first of the many problems you’ll have to face. You’ll also have to learn how to take care of and handle your own investment. The IRS will not allow you to borrow money from the account or make a profit from it in any way. It’s just like any other personal investment company would work.

Also, the total contributions that happen on a yearly basis can never exceed $5,500 if you’re less then 50 years old. After that, they cap at $6,500 and that is only the beginning. Even if you make it through the challenges and red tape, there is still a strong chance that you’ll have to pay taxes on any capital gains made.

[MaxiMan]

If You guys live on a democracy... then can select your governants.
Why allow them to add taxes to any income you have?
Do you think govs really do superb good things with the money they collect from your "donations"? Thats up to you.

[Sithara007]

If I make money on crypto currencies. How do I avoid as much tax as possible?

If you want to avoid paying taxes on crypto, then there are both legal and illegal methods to do that. If you want to go the legal way, then I'd ask you to hire a good tax consultant. If you want to take the illegal way, then you can do that through pre-paid debit cards or cash on mail.

[lili song]

Luckily my government still not apply tax on bitcoin because bitcoin against our law.
I can use bitcoin without pay any tax but I must bear own risk.
For me, applying tax is worth because it can also generate country's income for their own good !

[RodeoX]

Don't make any money. The best way to avoid taxes is to live dirt poor your entire life. You'll be liv'n the dream in your cardboard box under the highway bridge. No government tyranny now! Just the freedom of all the garbage you can eat.

[Bagaji]

If I make money on crypto currencies. How do I avoid as much tax as possible?

Why on earth will you think of such a thing that if Bitcoin and altcoins are accepted as a means of exchange for goods and services and equally accepted as taxable income by your government.