getting USD out of mt gox.... best approach

[isnowblind]

Hi,

I have some USD in my account at MtGox. I would like to get the USD into my hands, either cash or deposited in my US bank account.

From the MtGox website, it is not clear if they are still doing international wire transfers. If they are, anyone have recent experience that they can share?

I would also consider converting the USD to BTC and then transferring out to another vendor, then BTC->USD and finally USD->me. This method has two problems, 1 the current instability in BTC/USD exchange rate, and 2 the associated conversion fees.

Are there any other options? Does the MtGox redeem code system still exist? is that safe to trade?

If there are approaches best suited for different dollar amounts, then please include approx what amount is appropriate for the given method. I.e fixed based fees better for high value, percent fees better for low value.

And, lets say I go ahead and convert some of the USD to BTC. Then what is my best option for obtaining USD (in my bank/hands)? localbitcoin? bitcoin brokers?


Thanks.

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[sushi]

Gox took 5 weeks in 1 transaction to EU and another transaction was 16 days.
US Deposit was denied 2 weeks ago.

Gox's US Bank account was seized by the US Government this summer for violating some kind of the financial regulation there...

With current legal battles Mt Gox is facing in the US Federal Court, they are now required to report all US Based Transactions to US Goernment (IRS) and Bitcoin transactions will be treated as Gains from Short Security Trade.  (I would say get it out as BTC if you have accounts in EU, send it there)

Federal Court Judges, Texas and other locations, ruled BitCoin Trade is Taxable under Security Exchange Tax Rate.

Change it to BTC, then deposit it to BitStamp, then wait for about 5 days to be deposited into the US Bank Account via Wire.  $50 Wire fee

Example:  

If you have $1000 at Mt Gox, that would be about 2.73 BTC  ==> to BitStamp
==> change it to USD ($850 @ Sell Price) ==> cost you $50 in wire transfer
==> $$800 in your pocket in about 7-10 days later
==> About $200 in IRS Tax Obligation as Bitstamp is also require to report to US Gov for the US Based Transactions

So, $800 in your pocket in about 10 days but you may owe $200 to Uncle Sam on April 15, 2014

Reality, you got $600 in USD starting $1,000 USD GOX Account to your hand.

In Reality, it's about 20% Value Loss in short term, so $800 in your hand.  Another 20% Loss (IRS Tax) is something you decide what to do with the risk. May or May not get taxed later.  (There is a bill/law in the work right now in the US and we should hear something later this month if it pass or not)


 

[simplydt]

Shouldnt the IRS tax be on the profits he made? Eg if he deposited $1 then your calculation is right, but if he deposited $1,000 and he made no gains thus no tax is due?

[sushi]

Problem is initial BTC deposit seems to be seen as cashing out pure profit from highly suspected unlawful activities.

They knew about mining, so initial deposit/cashing out whatever, is seen as pure profit.  there after profit is calculated from buy/sell differences but anytime you add additional BTC from mining to cashout, those are seen as another pure 100% Profit.  (Unless you can show it was goods sales then, you can use B2B invoice showing you spent whatever as the source cost for that BTC)

When I asked my tax advisers, they explained to me as American has to report illegal drug trade profit on their tax return and more than likely the BitCoin trade profit be seen as such.  The 1st cashout option as 100% Profit, any subsequent transactions are calculated as regular short security trade gain (minus the buy price) so just what you profited.

But that is just the advise from 1 US CPA Firm, I'm sure there are many interpretations but that would be up to the IRS later when you have them on our door step one day...

US Department of Justice has Published Opinion stating BITCOIN is used in the unlawful activities with some legit transaction use.  You can Google it and you'll find the actual wording on their website and PDFs

Sadly, Mt Gox and BitStamp do report to IRS for the gains like trading stocks, free lunch is over.  (Remember the Paypal started to do that last year???)

[simplydt]

Ouch, that really really sucks!

[liberman]

Sell in localbitcoins and you won't loose almost anything.

[X68N]

Be warned about the delay of Bitcoin widraws at the moment.*
Some People reportet 3 days delay when cashout your Bitcoins.
I switched from Mt Gox to Bitstamp, it took nearly 30h ! to recieve the coins.
the Profit loss could be -8% , but its likely that it is 0% or +% becuas of the rising value of Bitcoin.
best point to Buy Bitcoin in Mt Gox is, shortly after a pricedrop (becuase it rises later again) so your buying price is better.

*in my opinion its the option which is better than a 4-8 week wire transfer from gox.

You only have to pay taxes for the hole amount, if you cant prove your initial buying amount (like a bank wire paper or something similar),
so you pay only taxes for the winnings.

[X68N]

thanks for sharing.
this type of "service" is a no-go. I will avoid this company like i avoid mt gox since they started to apply a synthetical "delay" to bitcoin withdrawls of several days.

greetings

[isnowblind]

How does the local bitcoin transaction work? each person has their laptop / mobile phone?

[isnowblind]

Also, thanks for the various comments about taxes. Unfortunately, I haven't made anything so it would be sad to see some artificial gain calculated when transferring BTC from one exchange to another. I have some USD in my MtGox account from a long time ago and want to get those funds back. A few years ago when I put the money into the account, it was straightforward to get the USD back out. Times have changed and now it seems MtGox makes it very difficult to back out funds.

Again thank you all for the suggestions, and of course additional suggestions are appreciated.

[naur]

Suggestion:

1. buy BTC in Mtgox.
2. transfer BTC to another bitcoin exchange website.
3. waiting and sell BTC in that bitcoin exchange website.
4. transfer USD to your bank account from that bictoin exchange website.

Now BTC that transfer into Mtgox is less less than BTC that transfer out Mtgox everyday. 

good luck!