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DeathAndTaxes
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Gerald Davis


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October 26, 2011, 05:23:59 PM
 #101

Looking in to it further, I have to agree it doesnt appear to be illegal in the US at this point.
The statement made by the attorney Tompkins however, is either incorrect or extremely misleading.

I missed that.  Got a link to quote?  Thanks.
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October 26, 2011, 05:33:16 PM
 #102

He was convicted because he was selling coins which were deceptively similar to US legal tender, using language that indicate a connection to US govt, and deceptively using less precious metal than face value of coin.  For example the $10 silver coin had ~$6 worth of silver in it.  Language on the website indicated that the coins were backed by silver and could be redeemed for silver certifercite.  What wasn't mentioned is that redeeming a $10 coin (purchased for $10 USD) would get you a $6 silver cert which could be redeemed for an equivelent amount in silver based on spot prices.

It was fraud and it is a poor example to illustrate the legality of Bitcoin.
Ah, I forgot that the US govt is directly connected to God and all the rest should pay the broker if they want to communicate with God. Of course, if the silver spot price was an issue those coins should be legalized now as silver spot is currently $33 per ounce! So, if you want to make a silver coin illegal you have to artificially depress the price of silver?!

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October 26, 2011, 05:36:12 PM
 #103

The statement made by the attorney Tompkins however, is either incorrect or extremely misleading.
  hear, hear!  That was the first thing I read. My vote is on 'extremely misleading', for the purpose of 'spin'.

If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system. - GA
It is being worked on by smart people. -DamienBlack
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October 26, 2011, 05:41:31 PM
 #104

He was convicted because he was selling coins which were deceptively similar to US legal tender, using language that indicate a connection to US govt, and deceptively using less precious metal than face value of coin.  For example the $10 silver coin had ~$6 worth of silver in it.  Language on the website indicated that the coins were backed by silver and could be redeemed for silver certifercite.  What wasn't mentioned is that redeeming a $10 coin (purchased for $10 USD) would get you a $6 silver cert which could be redeemed for an equivelent amount in silver based on spot prices.

It was fraud and it is a poor example to illustrate the legality of Bitcoin.
Ah, I forgot that the US govt is directly connected to God and all the rest should pay the broker if they want to communicate with God. Of course, if the silver spot price was an issue those coins should be legalized now as silver spot is currently $33 per ounce! So, if you want to make a silver coin illegal you have to artificially depress the price of silver?!

No three times the coins were redebased.  No one coin was minted with an amount of silver equal to the face value.  Same amount of silver and price of coin went from $10 to $20 to $25 as the price of .  Acquirers were never advised that while coins were backed by the value of silver they weren't backed by ENOUGH silver even at the time of minting.

The coins were minted to be obviously misleading, misleading enough that a jury of his peers felt it was his intent to defraud.

http://www.howtovanish.com/wp-content/uploads/2011/03/Liberty-Dollars-multiple.jpg

It went way beyond that ...

Quote
Liberty Dollar actively encouraged merchants who traded Liberty Dollars to give them to unsuspecting customers as change. An unsuspecting customer might receive a "$10 Liberty Dollar" medallion instead of $10 in Federal Reserve Notes. The value of the silver in those medallions was less than $10 FRN, so the unsuspecting customer would receive less than the value they thought they were receiving. It appears that such an exchange was viewed by the prosecution, and the jury, as evidence of an intent to defraud.

http://www.lewrockwell.com/rounds/rounds34.1.html

So you are owed $10 in change and you are given a $10 Liberty Coin (which looks like US currency) something you likely didn't want and it turns out the coin is really only worth $6 because it has little to no trace value and only $6 worth of silver in it.  You don't see anything wrong with that?  When those actions are combined with the groups stated intent to disrupt and overthrow the federal reserve and US currency it isn't difficult to see this stinks.

The case was about fraud & counterfitting.  It has nothing to do with Bitcoin.

Quote
The Liberty Dollar case was about fraud. It was not about using gold or silver in commerce, it wasn’t about protecting government power, or even about using private money. There are all kinds of alternate currencies in circulation in the US. Ithaca Hours, Potomacs, gift certificates, and Chuck E. Cheese tokens can all be used to barter and transact instead of legal tender coins and bills. It is not illegal for a dentist to take payment in chickens or in sacks of potatoes. Liberty Dollar was investigated and indicted because it could, and did, fool some people into thinking it was something that it was not.
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October 26, 2011, 06:39:38 PM
 #105

So you are owed $10 in change and you are given a $10 Liberty Coin (which looks like US currency) something you likely didn't want and it turns out the coin is really only worth $6 because it has little to no trace value and only $6 worth of silver in it.  You don't see anything wrong with that?
However, I do want them and reason is very simple. The 10 Liberty dollar coin has only $6 worth of silver while the 10 US dollar banknote has no silver or gold at all. They are backed by nothing but IRS demanding paying taxes in $$$! Do you know that the cost of printing a $100 banknote is just $0.17?

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October 26, 2011, 06:43:21 PM
 #106

So you are owed $10 in change and you are given a $10 Liberty Coin (which looks like US currency) something you likely didn't want and it turns out the coin is really only worth $6 because it has little to no trace value and only $6 worth of silver in it.  You don't see anything wrong with that?
However, I do want them and reason is very simple. The 10 Liberty dollar coin has only $6 worth of silver while the 10 US dollar banknote has no silver or gold at all. They are backed by nothing but IRS demanding paying taxes in $$$! Do you know that the cost of printing a $100 banknote is just $0.17?

  And you, as a US citizen would be more than entitled to buy any coin you wish IF it is presented as holding said value and can legaly do so. And, if said coin does not attempt to represent legal US tender, coins or otherwise. Its called counterfitting.  What he was selling was a far cry from a company selling gold coins with their own stamp on it, which would be perfectly legal if they do not look like US coins or have a misrepresentation of being 'backed' by the US in any shape or form.

If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system. - GA
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October 26, 2011, 06:50:34 PM
 #107

which would be perfectly legal if they do not look like US coins
Would you mind to post some images of coins that do NOT look like US coins but still have US symbols on them?

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Gerald Davis


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October 26, 2011, 07:00:36 PM
 #108

So you are owed $10 in change and you are given a $10 Liberty Coin (which looks like US currency) something you likely didn't want and it turns out the coin is really only worth $6 because it has little to no trace value and only $6 worth of silver in it.  You don't see anything wrong with that?
However, I do want them and reason is very simple. The 10 Liberty dollar coin has only $6 worth of silver while the 10 US dollar banknote has no silver or gold at all. They are backed by nothing but IRS demanding paying taxes in $$$! Do you know that the cost of printing a $100 banknote is just $0.17?

You aren't required to accept or use US federal reserve notes.  If you employer is willing you can be compensated for your time in gold or barter.  The US treasury makes no claims to it being back by anything but full faith and credit of US government.

Also if you want to buy Silver why not buy $10 in silver for $10 instead of $6 in silver for $10?

You can use any alternate currency you like.  Hell you can put your entire life savins in Chuck E Cheese video game tokens (warning they might be easy to counterfit). 

However you can't mislead people, commit fraud, or counterfit US currency.  It is a rather simple concept.
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October 26, 2011, 07:13:49 PM
 #109

which would be perfectly legal if they do not look like US coins
Would you mind to post some images of coins that do NOT look like US coins but still have US symbols on them?
 Being that I deal very, very little in coins, other than a safe full of actual US minted ones, walking liberties, half bens, half kens, etc, I am not familiar with and Non US coins that have US symbols on them. I have to ask though, why would you want to buy Non US coins that had US symbols on them?  

  But, if you are still insterested, I believe you are looking for gold 'proofs', etc. Again you would want to talk to one of the coin buffs around here if that is truely your interest.

One mint of thousands that sell Gold Clad Proofs;    http://en.wikipedia.org/wiki/National_Collector%27s_Mint

  Edit; Just realised how far off topic we have gotten. Anyone interested enough in LD or debating the interpretation of US Coinage Act, USC, etc, want to start a new thread?

If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system. - GA
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October 26, 2011, 07:19:10 PM
 #110

They are still going to tax you in US dollars on the Chuckie Cheese tokens though. 


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October 26, 2011, 07:23:39 PM
 #111

They are still going to tax you in US dollars on the Chuckie Cheese tokens though. 

Exactly.  So even if your life is 99% USD free you may someday still need to use a currency exchange to pay your income taxes.  Thinking about that reminds me of the novel SnowCrash.  Corporations (and franchises) have superceded both of the authority of federal government.  Most people no longer use USD but federal employees are paid in it and the government requires all fees/taxes/fines to be paid in USD.

Sadly I could see our government being that petty.



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October 26, 2011, 07:24:49 PM
 #112

Also if you want to buy Silver why not buy $10 in silver for $10 instead of $6 in silver for $10?
Because with my change I don't want to buy silver but 10 Liberty dollars! The fact that the 10 Liberty dollar coin has $6 worth of silver built-in is a plus that the US government $10 don't have!

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Gerald Davis


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October 26, 2011, 07:28:53 PM
 #113

Also if you want to buy Silver why not buy $10 in silver for $10 instead of $6 in silver for $10?
Because with my change I don't want to buy silver but 10 Liberty dollars! The fact that the 10 Liberty dollar coin has $6 worth of silver built-in is a plus that the US government $10 don't have!

There is nothing wrong with that.  As long as you are aware that what you are receiving is not legal tender. 

The defendants passed coins off on unsuspecting victims.  They minted coins deceptively similar to US legal tender.  They used misleading statement regarding the value of the coins.

There are legal alternative currencies in the United States.  They didn't attempt to defraud victims, counterfit US coins, or pass off coins as legal tender hence they still exist and the organizers aren't in jail.
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October 26, 2011, 07:31:27 PM
 #114

So even if your life is 99% USD free you may someday still need to use a currency exchange to pay your income taxes.
You'll pay US dollar income taxes on your US dollar income. If the US government wants you to pay income taxes on your bitcoin income they'd have to define taxes in bitcoin too!

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October 26, 2011, 07:32:56 PM
 #115

They are still going to tax you in US dollars on the Chuckie Cheese tokens though. 

Exactly.  So even if your life is 99% USD free you may someday still need to use a currency exchange to pay your income taxes.  Thinking about that reminds me of the novel SnowCrash.  Corporations (and franchises) have superceded both of the authority of federal government.  Most people no longer use USD but federal employees are paid in it and the government requires all fees/taxes/fines to be paid in USD.

Sadly I could see our government being that petty.


  Hey, atleast there is a tax deduction on the costs incured in converting said monies.  Roll Eyes  Atleast according to one of my wife's US tax guides here. That goes for capital gains and gross receipts.  

If you're not excited by the idea of being an early adopter 'now', then you should come back in three or four years and either tell us "Told you it'd never work!" or join what should, by then, be a much more stable and easier-to-use system. - GA
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October 26, 2011, 07:35:44 PM
 #116

So even if your life is 99% USD free you may someday still need to use a currency exchange to pay your income taxes.
You'll pay US dollar income taxes on your US dollar income. If the US government wants you to pay income taxes on your bitcoin income they'd have to define taxes in bitcoin too!

No they won't.  Currently you are required to pay income taxes on your USD equivelent income.  The IRS doesn't need to do anything, the laws have already been in place for 50+ years.

If your employer pays you in euros, gold, chickens, kWh, gaming tokens, giftcards, compute cycles, prostitution credits, or simply barter you STILL owe income taxes in USD based on the equivelent value of that compensation in USD.

Bitcoin would be no different.
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October 26, 2011, 07:35:53 PM
 #117

or pass off coins as legal tender
Hmmm... you have to define what is 'legal tender'?

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October 26, 2011, 07:41:53 PM
 #118

Currently you are required to pay income taxes on your USD equivelent income.
Bitcoin can not be represented as a USD equivalent. There is no official exchange rate and never will be!

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October 26, 2011, 07:46:18 PM
 #119

Well I don't define it the courts do.  Simplisticly legal tender is the method of payment recognized by a legal system to be valid for meeting a financial obligation

If you owe me $10,000 you can't pay me in chickens (even if they are worth $10,000).  I can demand you sell those chickens and pay me in legal tender.  In the US currently the only legal tender is the Federal Reserve Notes.

Now that doesn't mean I CAN'T accept chickens (or gold, or bitcoins) but I don't have to.  This is where the phrase "good for all debts public and private" comes from.  

Likewise if I owe you $100 you have no legal authority to require repayment in Gold, bitcoins, or chickens.  Granted you can take the $100 I pay you and buy Gold, bitcoins, or chickens likewise we can come to a mutual agreement on alternatives.

By passing our Liberties dollars as change for Federal Reserve Note the actors were implying they are legal tender.   Victims weren't advised these weren't US coins and given an options to accept them as alternate payment.  

There is only one legal tender in the United States and that is Federal Reserve Notes.  Of course that could change via statute but that is rather unlikely.
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October 26, 2011, 07:53:34 PM
 #120

Currently you are required to pay income taxes on your USD equivelent income.
Bitcoin can not be represented as a USD equivalent. There is no official exchange rate and never will be!

Come on are you are moron or do just like pretending to be.

There also isn't an official exchange rate between:
USD->Gold
USD->Chickens
USD->kWh
USD->Gaming tokens

The IRS doesn't care.

If you receive compensation (in any form) you are required to make a note of the USD equivelent.  At the end of the year that USD equivelent will be part of your income and thus income taxes.  It doesn't matter if you are paid in chickens, gold or Bitcoins they all have USD equivelent at the time of compensation.

It is very easy to do with Bitcoin.
I pay you 5BTC to annoy the living shit out of someone else for 2 hours.  As of the time of writing that is roughy $13.75.  You owe income taxes on that $13.75.  Obviously there is some margin of error and you could game the system slightly by recording that value is roughly $2.68 per BTC on one exchange still if you tried to report $0.01 USD per BTC and got caught that would be tax fraud.  Likewise if you don't report that income it is tax fraud.

How effective the IRS would be at catching tax fraud is immaterial to the fact that currently you owe taxes in USD for all compensation regardless of type or method (and that would include Bitcoin).
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