How do I pay taxes?

[bitpop]

Is it necessary to fill out a tax return, on which I should declare how much money I made during the previous financial year?

Only if you owe

Not entirely true: https://turbotax.intuit.com/tax-tools/tax-tips/IRS-Tax-Return/Do-I-Have-to-File-a-Tax-Return-if-I-Don-t-Owe-Tax-/INF22780.html

Yes if you're making money outside a w2, you can't just deduct stuff and not file

[RodeoX]

You need to pay capitol gains if you hold the coins for a year or more.

More than a year. A year or less is short-term gains (in the US).

If you spend them right after buying them it can be said you are using bitcoin as a payment network and not an investment. If spending/selling after a year try this formula.

It makes no difference, it is still a tax event. Any gains made on the coins are taxable.

Thanks for the clarification. I do not know myself. But I have heard a lawyer say that if you buy then use coins as a payment system you might not be liable. 

[charliemaggot]

Thanks for the clarification. I do not know myself. But I have heard a lawyer say that if you buy then use coins as a payment system you might not be liable. 

Given there is no guidance, every accountant has their own opinion and technically none are wrong. Some accountants intend to file as currency, some as assets, some as manufactured stock. It's a decision between you are yours. If you got audited, it's unlikely going to cause a huge issue if you have tried to pay your taxes in good faith. Worst case, I imagine, is you might owe more based on what they decide.

This attorney (#3) thinks they are taxable. No doubt you could find one who believes it's a currency and therefore doesn't think that.

[bitpop]

If you buy and hold bitcoin indefinitely you won't need to pay any tax. 

Hodl till I die

[bitpop]

If you don't trust yourself, destroy your private keys or I provide hodl escrow

[RodeoX]

Thanks for the clarification. I do not know myself. But I have heard a lawyer say that if you buy then use coins as a payment system you might not be liable. 

Given there is no guidance, every accountant has their own opinion and technically none are wrong. Some accountants intend to file as currency, some as assets, some as manufactured stock. It's a decision between you are yours. If you got audited, it's unlikely going to cause a huge issue if you have tried to pay your taxes in good faith. Worst case, I imagine, is you might owe more based on what they decide.

This attorney (#3) thinks they are taxable. No doubt you could find one who believes it's a currency and therefore doesn't think that.

That is my hope also. If I am trying to pay my share of tax but the IRS is not providing me any direction on how to do that, I should not be penalized.

[cryptodash4]

will you tell me can i pay with 50% btc and 50% ETH can we pay in both?

[bitpop]

will you tell me can i pay with 50% btc and 50% ETH can we pay in both?

You pay in anything you'd like

[zasad@]

necroposting
Further discussion of the topic is meaningless.
If you have a question about taxes, then first write in which country you are located.
The main thing is, first, try to figure out for yourself at what amounts of non-payment this crime becomes criminal and you can be held criminally liable

[skyline65]

You can use some gate way like perfect money or paypal to pay the tax , Because you already provide your details to verify the KYC And if you still think there will be any problem , then you will contact to the income tax department.  But as far i know you should first convert your crypto currency to usd and use PAYPAL gate way to get the money. You will pay taxes at the same time .

[Amon1231]

You always pay taxes, when you buy something they have Value Added Taxes, if you have a property you have Amnesty Tax we are always full of taxes.

[Streets 2.0]

It all depends on the jurisdiction. It would be correct to ask how can I avoid paying taxes (that is, paying them as little as possible)? Then there is little choice: evasion, partial evasion, full payment or partial payment are possible. I think you still need to legalize your income related to cryptocurrency. If you answer the question how: - everything depends on the particular case. The simplest thing to do is to contact your government tax authority. There they will give you a detailed and substantive answer to the question "how?"

[chaoscoinz]

Paying taxes on your cryptocurrency trades you made throughout the year can be simple, yet be completely complicated and quite the daunting task.
I day trade, and only on one exchange Kraken (U.S based exchange) , so I simple export my daily trade history into an excel sheet format, and voila, I can import it on Bitcoin.tax , one of the numerous platforms that help people get their crypto based taxes filed correctly.
  It really depends on where one lives, the tax laws could be extremely laxed, or stringent. In the U.S, All uncle Sam asks is to report your income and "pay Caesar what belongs to Caesar", then your free to go on your merry way!

Just realized this thread was old, and managed to get bumped to the top, still, I hold the same opinion on the matter for any one who has just joined the thread like me,  back then there weren't too many platforms, now there a dozen. Here are a few, Bitcoin.tax, Koinly, Cryptotrader, and Accointing. You should be able to export directly to Turbotax or Tax-Act immediately.  Remember to practice your due diligence and be sure to keep detail ledgers of your trade and purchase history!

[matjas]

Depends on the country of residence. Some EU countries still have really vague tax laws when it comes to cryptocurrencies. For example in my country you only need to pay tax if you exceed 100 trading days and for mining. In some countries if you hold a coin for more then one year, you dont have to pay tax.

[Streets 2.0]

A happy person seems to be flying into the fire himself))) Why should you pay taxes if you have not done this before? Usually, the tax office in such a case will not only explain to you how to pay taxes and where to do it, but will also force you to pay a fine for previous tax periods. Take my word for it - while everyone quietly do your business as you did. When everything changes, you and the others will pay your money.

[Streets 2.0]

You just fill out a declaration, what are the problems? The amount of your transactions is the taxable base. If you know the value of the percentage, you can probably even do it in real time. Although the best solution I see is to apply for a paid consultation with a tax specialist, or better yet, hire one for the first payment. (then you yourself will learn how to do it) And the first time you can entrust a professional for loyalty and confidence.