Taxation of BTC

[bitcoinbrokeragegroup1]

In the USA, bitcoin is regarded as property. Therefore, capital gains are involved for property held less than one year. If you are paid in crypto, it is treated as ordinary income. For 2018, the IRS will be watching out for trades and sales. Last year people who declared gain from coins numbered in the hundreds, not even a thousand. If you trade one coin for another, the coin you trade will be valued  as of the sale or trade date.

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[musharaf]

Crypto in the advanced countries like US are making regulations for bitcoin and the altcoin to use these in the future for online jobs and online services these will be the good payment option for us in the future and the taxation of bitcoin in the sense that if we earn bitcoin then we use that for some commodity in different sectors and we pay the cash or currency then for that commodity some tax is imposed called consumer tax which will also we paid during our routine expenses and these all are good for the future.

[BillyBobZorton]

There are many threads like this on the legal section. If you want to ever cash out, and you did trading (not just buying once and holding, but trading around, specially between alts in more obscure exchanges) you better kept track of absolutely everything, otherwise the scammer in the government may steal your coins as soon as they are sold and deposited in fiat in your bank account.

They will ask for entire trading history and so on. I have never cashed out because of this and many are on the same situation. There's nothing clear about things yet. Just hold and see what happens.

[BartS]

There are many threads like this on the legal section. If you want to ever cash out, and you did trading (not just buying once and holding, but trading around, specially between alts in more obscure exchanges) you better kept track of absolutely everything, otherwise the scammer in the government may steal your coins as soon as they are sold and deposited in fiat in your bank account.

They will ask for entire trading history and so on. I have never cashed out because of this and many are on the same situation. There's nothing clear about things yet. Just hold and see what happens.

Correct, that is the greater risk right now when you have your money in the form of a cryptocurrency the government really cannot do anything to take it away from you but the moment you choose to go to fiat they have all the power and they are not going to be shy about showing they have all the power, if you ever want to see your money again you have to comply with everything they say, this is why it is about idea to cash out right now it is better to let other people go through the process and learn from their experiences after that happens and you know what to expect then you can cash out.

[Stavri]

taxation of bitcoin? i dont think it is possible. how can they identify wallet addresses. they can not find anybody by their electronic wallet. it is impossible in blockchain technology. everything is anonymous. all they can do is taking taxes from bank transactions related with exchanges.

[darkangel11]

If you trade one coin for another, the coin you trade will be valued  as of the sale or trade date.

And how will you prove that the transaction took place? You'll have 2 addresses on the blockchain and a date, that's all. Good luck trying to pin this on a real person, especially in a world when multiple transactions are taking place every second and mixing services are widely available. Also, how is the tax office going to recognize whether the exchange was a transaction and not a gift? If you really want to play with them you can declare this as income from begging or your online sugar daddy

[babygun]

taxation of bitcoin? i dont think it is possible. how can they identify wallet addresses. they can not find anybody by their electronic wallet. it is impossible in blockchain technology. everything is anonymous. all they can do is taking taxes from bank transactions related with exchanges.

In Belgium they recently added a new tax on bitcoin/altcoin trading where you need to pay 33% on all your winnings that you made by trading. They are already tracked down several people who made a nice profit by trading. You are obliged to fill in your earnings on your tax letter, but I don't think many people are doing this lol.

[BartS]

taxation of bitcoin? i dont think it is possible. how can they identify wallet addresses. they can not find anybody by their electronic wallet. it is impossible in blockchain technology. everything is anonymous. all they can do is taking taxes from bank transactions related with exchanges.

You're right that is impossible to tax everyone since most addresses are not connected to a particular identity, but many people want at some point to cash out their bitcoin and convert it to fiat, that is when the governments can tax you since they will know which addresses are connected to your identity and will be able to tax you accordingly, this means that the only realistic way to avoid being taxed is to always use bitcoin and to use it in a way that a connection is never created between your identity and your addresses and right now I do not know if it is possible to do that.

[botany]

taxation of bitcoin? i dont think it is possible. how can they identify wallet addresses. they can not find anybody by their electronic wallet. it is impossible in blockchain technology. everything is anonymous. all they can do is taking taxes from bank transactions related with exchanges.

You're right that is impossible to tax everyone since most addresses are not connected to a particular identity, but many people want at some point to cash out their bitcoin and convert it to fiat, that is when the governments can tax you since they will know which addresses are connected to your identity and will be able to tax you accordingly, this means that the only realistic way to avoid being taxed is to always use bitcoin and to use it in a way that a connection is never created between your identity and your addresses and right now I do not know if it is possible to do that.

You are confusing government taxing bitcoin profits and government catching tax evaders. Taxation can occur at any point. It doesn't matter how many addresses you own and how difficult it is to connect it to your real world identity.
If you evade tax, then you have to be prepared to pay the penalty if you get caught.

[1kings]

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There are many threads like this on the legal section. If you want to ever cash out, and you did trading (not just buying once and holding, but trading around, specially between alts in more obscure exchanges) you better kept track of absolutely everything, otherwise the scammer in the government may steal your coins as soon as they are sold and deposited in fiat in your bank account.

They will ask for entire trading history and so on. I have never cashed out because of this and many are on the same situation. There's nothing clear about things yet. Just hold and see what happens.

Correct, that is the greater risk right now when you have your money in the form of a cryptocurrency the government really cannot do anything to take it away from you but the moment you choose to go to fiat they have all the power and they are not going to be shy about showing they have all the power, if you ever want to see your money again you have to comply with everything they say, this is why it is about idea to cash out right now it is better to let other people go through the process and learn from their experiences after that happens and you know what to expect then you can cash out.

The easiest way to escape capital gain tax on cryptos is to find products and services that accept direct crypto payment without you converting to fiat.


The challenge that follows is this, how will businesses accepting cryptos interface with government agencies and other businesses not accepting cryptos.

[goaldigger]

If that so then the tax paid will be depended on the bitcoins price. Capital gain tax uses percentage and if the value of BTC is low, the declaration should be low too. If bitcoin is considered as an asset, then every transactions should be taxed.

[orions.belt19]

taxation of bitcoin? i dont think it is possible. how can they identify wallet addresses. they can not find anybody by their electronic wallet. it is impossible in blockchain technology. everything is anonymous. all they can do is taking taxes from bank transactions related with exchanges.

You're right that is impossible to tax everyone since most addresses are not connected to a particular identity, but many people want at some point to cash out their bitcoin and convert it to fiat, that is when the governments can tax you since they will know which addresses are connected to your identity and will be able to tax you accordingly, this means that the only realistic way to avoid being taxed is to always use bitcoin and to use it in a way that a connection is never created between your identity and your addresses and right now I do not know if it is possible to do that.

You are confusing government taxing bitcoin profits and government catching tax evaders. Taxation can occur at any point. It doesn't matter how many addresses you own and how difficult it is to connect it to your real world identity.
If you evade tax, then you have to be prepared to pay the penalty if you get caught.

In fact, there are already a number of few countries out there that has imposed tax on trade transactions or exchanges from crypto to fiat. Other countries may follow this and pattern from their taxation framework. It's not so impossible as others suggest. Some may even impose a tax on gaining crypto income. Governments may seek regulation on exchanges or trading platforms to be able to oversee the transactions being made locally.

[Addywealth]

I will support taxation of BTC at least a step towards global recognition and acceptance in most of the countries bitcoin is facing challenges today. Every government want to have control over affairs of everything done wirhinf the state and if that is done they can come up with other policies to favour the state

[tonylewisverdu]

is true what you've said? bitcoin is property in US?. I don't know that..

[2Godbdglory]

 Taxation of BTC IS THE BIG PROBLEM BETWEEN GOVERNMENT AND PEOPLE THAT ARE INVOLVING IN BITCOIN BECAUSE GOVERNMENT IS NOT GETTIG ANY PROFIT FROM BITCOIN THEREFORE IT IS GOOD FOR US BUT GOVERNMENT ARE NOT SATISTFY WITH THAT

[CherRic]

In the USA, bitcoin is regarded as property. Therefore, capital gains are involved for property held less than one year. If you are paid in crypto, it is treated as ordinary income. For 2018, the IRS will be watching out for trades and sales. Last year people who declared gain from coins numbered in the hundreds, not even a thousand. If you trade one coin for another, the coin you trade will be valued  as of the sale or trade date.

That's just legal way of taxing bitcoin. In our country also, bitcoin has tax. In every cash out of bitcoin, there is corresponding tax into it. Well, its also good because you can contribute to our country,

[bitkanu]

In the USA, bitcoin is regarded as property. Therefore, capital gains are involved for property held less than one year. If you are paid in crypto, it is treated as ordinary income. For 2018, the IRS will be watching out for trades and sales. Last year people who declared gain from coins numbered in the hundreds, not even a thousand. If you trade one coin for another, the coin you trade will be valued  as of the sale or trade date.

That's just legal way of taxing bitcoin. In our country also, bitcoin has tax. In every cash out of bitcoin, there is corresponding tax into it. Well, its also good because you can contribute to our country,

Actually every country in this world indirectly taxing your bitcoin by simply taxing your yearly income when you report it. It's just some people didn't know about this.
When your wealth increase and you got an income whatever the sources from, it's a target for taxation.

[MakeMoneyBtc]

I didnt know that USA or another country already have taxes on bitcoin trading. I am wondering how rhey are going to find the persons that have an income from trading cryptocurrencies but dont pay any taxes because that is hard to do. They could ask every exchanger to send them the history of all transactions through banks but I never heard of something like that. Also people can sell cryptocurrencies with cash and that is impossible to trace. I have saw some cases where undercover police arrested people for selling cryptos without asking for ID but I dont know if that also counts on taxes and anyway police cant check every bitcoin seller since they have better and important things to do.

[Ultegra134]

In the USA, bitcoin is regarded as property. Therefore, capital gains are involved for property held less than one year. If you are paid in crypto, it is treated as ordinary income. For 2018, the IRS will be watching out for trades and sales. Last year people who declared gain from coins numbered in the hundreds, not even a thousand. If you trade one coin for another, the coin you trade will be valued  as of the sale or trade date.

I don't really get how the IRS might know whether or not you are having Bitcoin transactions. Unless you are withdrawing money from exchanges to your bank account, I don't see a way they could find out. Moreover, I don't really see a reason to declare it as income, unless we're talking about thousand's in transactions.

[Rashid555]

If bitcoin is taxed then the benefit from bitcoin will be less and most of the people love to use this because it is free from any eye checking and other transactions so if the money is taxed it means that there is some check and balance on these so for this some rules will also follow before doing any transactions in the future.