US and Cryptocurrencies: Tax Payment is a Rarity

[Marko Vidrih]

At the US online platform Credit Karma, just 0.04% of 250,000 taxpayers said they would pay tax on their profits from cryptocurrency trading. Current estimates suggest that 25 billion USD in taxes will be due in the US alone due to digital currency gains. As a result, countless users have dropped some data in the statement of sales.

Of the 250,000 users of financial services provider Credit Karma, fewer than 100 have acknowledged that their tax returns for 2017 include sales of cryptocurrency trading. In the US, the tax must be submitted earlier than in EU.

In the US, all crypto sales are subject to capital tax. Credit Karma Tax assumes that the details of crypto winnings due to the complexity are submitted only at the last minute. Or not at all. As complicated as the taxation appears at first glance, but it is not. In addition, the US Internal Revenue Service (IRS) has long been wide awake when it comes to this issue. The US online trading center Coinbase was a few months ago very extensive to provide innumerable information required to come to US tax evaders on the clutter. When the operator refused, the IRS went to court. Instead of disclosing at least 500,000 account details, Coinbase has since been obliged to disclose the most active 13,000 users.

Paying taxes must not be a coincidence
The Düsseldorf lawyer and book author dr. Joerg Andres can not quite understand why Bitcoin profiteers boast to this day that they are not taxing their crypto winnings. Andres describes it as "highly risky" to conceal this revenue from the tax office. He believes it is only a matter of time before the tax authorities catch up. They would soon track down those revenues as well. Even if it takes some time, employees of tax offices at Coinbase & Co. can access the data of German taxpayers as part of a request for information. Just because an online trading center is located abroad, the tax offices can still match the information in the tax return with the assets and the activities of the respective wallets.
Prof. Dr. Andres: "Anyone who still believes in the myth of complete anonymity of Blockchain activities, should not be surprised if good advice then literally will be expensive. Anyone who has not fully fulfilled his obligation to explain to the tax office in the past should do so quickly. There are still good chances to process such failures without penalty. "
Author: Marko Vidrih

[xdrpx]

Dr. Joerg Andres claims seem reasonable for when the crypto's have been procured through channels like coinbase which maintains a database of the buyers and sellers and would be ready to hand them over to the IRS, but this may not be true in the case of trades that happen between people through localbitcoins or through decentralized patforms. Such users can affectly (if they've taken the right precautions to hide their ID and information details) be safe and may no longer have to pay taxes on any of their crypto holdings or gains from sales. Also, I understand that it's good to lawfully abide and pay your taxes, but it also reduces our earnings by a large percentage leaving less behind for ourselves and all this for a cryptocurrency developed for the purpose of staying out of trouble from tax authorities if procured without leaking any ID or personal informations.

[Xester]

Well this is the new trending topic here in this forum. It was said that not ally crypto holders are willing to pay their taxes. Well if we look at the bitcoin crash that is possibly the reason why those gainers last year become losers this year and thus they cant afford to pay their taxes. But to those who have encashed their bitcoin profit then they should be taxed.