htownad (OP)
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April 24, 2020, 02:24:54 PM |
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Does anyone ever claim/report their crypto purchases/sales? What is your threshold for reporting? I was thinking no one bothers unless you withdraw hundreds of thousands of dollars.
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Jeremy Franklin
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April 24, 2020, 02:26:53 PM |
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Does anyone ever claim/report their crypto purchases/sales? What is your threshold for reporting? I was thinking no one bothers unless you withdraw hundreds of thousands of dollars.
All depends on your country and the jurisdiction you live in, so it's hard to tell without some more information from your side. But there is one thing, I can say: Pay your taxes.
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Cnut237
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April 24, 2020, 02:55:50 PM |
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Yes, it varies wildly depending on your country. I am in the UK, and I have paid tax on crypto assets. Here, it is treated as capital gains, and crypto-to-crypto trades are taxable, not just crypto-to-fiat (guidance here), and there is a threshold below which you pay nothing. Personally I paid tax for my first year in crypto, after which I was fully aware of the tax implications and have kept my dealings since then well below the threshold. I would reiterate the advice above: pay your taxes! Blockchains are (generally) immutable and transparent; your history is there for all to see. As soon as you withdraw to fiat or verify yourself on an exchange, your identity is tied to your crypto dealings. Of course there are mixers and other ways around this, but it's up to you if you want to worry about the tax man catching up with you in say 10 years' time... I am happy to give basic advice to anyone in the UK - probably PM me as I may miss a response here. But in general, if you have concerns or are unsure of anything it is best to consult a professional. There are accountants out there who deal with crypto gains.
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Negotiation
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April 24, 2020, 03:04:28 PM |
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I don't think there are any tax reports on crypto But that's exactly what the value of crypto is where you stand If crypto is controlled by the government then you don't have to report tax. If it is not controlled by the government why don't we have as many dollars as there are taxes We can do as we wish In the case of our country there is no tax It will depend on your country but you can report crypto on tax if you have it in your country.
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owlcatz
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April 24, 2020, 03:40:08 PM |
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If you live in the usa, you should report all your crypto transactions. If you don't know how, sign up for a site like bitcoin.tax.
Otherwise, you WILL regret it later..
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. I C Λ R U S | | | | █████▄▄█████▄▄ ████████▀▀▀████ ██████▀█████▀███ ████████████████ ████████████████ ████████████████ ░▄█████████████████ ███████████████████ ███████████████████ ████████░░░▀▀▀▀▀▀▀▀ ████████▄▄▄████████ ███████████████████ █████████████████▀ | ░░░███ ▄▄▄███ ██████ ░░░███ ░░░███ ░░░███ ░░░███ ░░░███ ░░░███ ░░░███ ▄████████ ███▌░▐███ ████████▀ | | | | | █████████████████████ █████████████████████ █████████████████████ ██████▀▀▀▀████▀▀█████ █████░░▄▄░░██░░░█████ █████▄▄██░░███░░█████ █████▀▀▀▀░░▀██░░█████ ████░░░░▄▄▄▄█▀░░▀████ ████░░░░░░░░█░▀▀░████ █████████████████████ █████████████████████ █████████████████████ █████████████████████ | ████ ██ ██ ██ ██ ██ ██ ██ ██ ██ ██ ██ ████ | ████ ██ ██ ██ ██ ██ ██ ██ ██ ██ ██ ██ ████ | ████ ██ ██ ██ ██ ██ ██ ██ ██ ██ ██ ██ ████ | | | | ████ ██
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LeGaulois
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April 24, 2020, 04:15:27 PM |
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The first time I see someone thinking the date to send your income report for the taxes is the same worldwide. And contrary to what you think, there really are people who pay taxes on cryptos.
Otherwise, you WILL regret it later..
In my twenties, I tried to cheat the system, how stupid it was, years after I had to pay an amount with 4 digit numbers. Never again... Now I'm so happy to pay taxes ![Cheesy](https://bitcointalk.org/Smileys/default/cheesy.gif)
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ryzaadit
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April 24, 2020, 04:35:50 PM |
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Otherwise, you WILL regret it later..
IDK know how the "tax" works for the USA, where did they know your history trading crypto. I mean there's is a chance someone not paying the tax, but it's kinda weird went the government can track u because not paying the taxes xD really curious about thats. In my country, all depends the honesty each person fill up the tax document about their earning Freelance, Trading and other earning methods also there is a minimum income included in tax payments around 60 Million IDR/Years. So basically if we the earning more than 60 Million IDR exceeds the minimum tax income you should pay the tax but sometimes the person not filled up their earning or even not doing a reported tax so he avoided to paying the tax and government still can't really track him.
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Findingnemo
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April 24, 2020, 04:59:28 PM |
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You have to report taxes when you convert it into fiat money with your bank accounts because it is possible to see that from where you go money and if your government has regulations for taxing crypto income then ou should file taxes based on it or it will just come under normal income tax depends on your country as well.
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pixie85
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April 24, 2020, 07:53:39 PM |
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You have to report taxes when you convert it into fiat money with your bank accounts because it is possible to see that from where you go money and if your government has regulations for taxing crypto income then ou should file taxes based on it or it will just come under normal income tax depends on your country as well.
Not always. If you bought cryptocurrency for cash or got it for free somewhere like from a giveaway, a faucet, won in an online casino, got it somewhere else where you did not use your bank account or credit card and did not do KYC. In short if you got your crypto anonymously you don't have to report it. It's impossible to trace it back to you as long as you don't sell it for fiat on exchanges. If your situation is different you have to check how your country sees it. Some countries will want only to know about sales for fiat and other will want to know everything.
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jademaxsuy
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April 24, 2020, 08:11:53 PM |
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It really depends on what country you are in. I came across a thread where a person didn't like paying taxes but he did pay and that's important if your country ask for taxes even if it's about crypto. It's good enough that a country encourage cryptocurrency other than country that ban crypto.
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malevolent
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April 24, 2020, 08:38:30 PM |
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Not always.
If you bought cryptocurrency for cash or got it for free somewhere like from a giveaway, a faucet, won in an online casino, got it somewhere else where you did not use your bank account or credit card and did not do KYC.
In short if you got your crypto anonymously you don't have to report it. It's impossible to trace it back to you as long as you don't sell it for fiat on exchanges.
If your situation is different you have to check how your country sees it. Some countries will want only to know about sales for fiat and other will want to know everything.
He specifically mentioned selling for fiat on an exchange. The higher the amount, the higher the risk that sooner or later you'd have to pay those taxes + penalties + possibly criminal prosecution. Even if you sell it for cash in person, or via an ATM without KYC, or use it to pay for goods and services, the more you spend without declaring your income/enough income, the greater the target you're painting on your back. Especially if you buy anything that leaves mandatory paper trails such as real estate or vehicles. Traveling around the world to expensive places and posting pics on social media for the world to see (pre/post-COVID19) if one is officially unemployed also isn't the smartest thing to do. The tax office could always randomly (or not so 'randomly') audit you and start asking questions how you can afford a certain lifestyle while declaring little to no income. So be smart if, say, you're officially unemployed but still want to enjoy nicer things. Of course it differs from country to country, but for the developed ones and the richer developing countries that's how it is roughly. I was thinking no one bothers unless you withdraw hundreds of thousands of dollars.
You might be bothered years down the line and be forced to pay with interest and penalties. Especially if your withdrawal is a large fraction of your total income or you trip some other flag due to high spending, having a snitch for a neighbour, etc. Consult a professional.
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pixie85
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April 24, 2020, 08:46:42 PM |
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Not always.
If you bought cryptocurrency for cash or got it for free somewhere like from a giveaway, a faucet, won in an online casino, got it somewhere else where you did not use your bank account or credit card and did not do KYC.
In short if you got your crypto anonymously you don't have to report it. It's impossible to trace it back to you as long as you don't sell it for fiat on exchanges.
If your situation is different you have to check how your country sees it. Some countries will want only to know about sales for fiat and other will want to know everything.
He specifically mentioned selling for fiat on an exchange. The higher the amount, the higher the risk that sooner or later you'd have to pay those taxes + penalties + possibly criminal prosecution. Even if you sell it for cash in person, or via an ATM without KYC, or use it to pay for goods and services, the more you spend without declaring your income/enough income, the greater the target you're painting on your back. Especially if you buy anything that leaves mandatory paper trails such as real estate or vehicles. Traveling around the world to expensive places and posting pics on social media for the world to see (pre/post-COVID19) if one is officially unemployed also isn't the smartest thing to do. The tax office could always randomly (or not so 'randomly') audit you and start asking questions how you can afford a certain lifestyle while declaring little to no income. So be smart if, say, you're officially unemployed but still want to enjoy nicer things. Of course it differs from country to country, but for the developed ones and the richer developing countries that's how it is roughly. That's why you walways need to be smart about it. People who knowingly break the law and then brag about it on social media aren't smart. Spending can also be done in various ways. If you sell your coins withour exposing yourself through KYC and then spend it on gadgets, furniture and electronics no tax man is going to know about it. He is not going to follow you with a camera filming you buying a new macbook or a set of rims for your car. Buy a house and you won't be able to hide it. It depends on your situation. How you got it, how you sold it, where you live, what's your income. Hiding a sale of 1 bitcoin worth 8 thousand dollars is easy when you earn 50 thousand a year. Much harder when you're unemployed on benefits.
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Welsh
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April 24, 2020, 09:07:25 PM |
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Yes, it varies wildly depending on your country. I am in the UK, and I have paid tax on crypto assets. Here, it is treated as capital gains, and crypto-to-crypto trades are taxable, not just crypto-to-fiat (guidance here), and there is a threshold below which you pay nothing. Personally I paid tax for my first year in crypto, after which I was fully aware of the tax implications and have kept my dealings since then well below the threshold. I think it could be rather beneficial to the community if a in depth guide was made on this specifically for the UK, taxes are typically so confusing, and the wording of these tax laws have always been filled with jargon. I'll have to take a look at what is required. I think with tax being delayed this year, further confusion will be added due to the COVID19 situation. I've personally been thinking about getting an accountant that deals specifically with crypto cases, as other accountants don't seem to be very clued up on it. Although, I expect this will continue to change, and an increasing amount will become aware.
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htownad (OP)
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April 24, 2020, 09:33:50 PM |
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You have to report taxes when you convert it into fiat money with your bank accounts because it is possible to see that from where you go money and if your government has regulations for taxing crypto income then ou should file taxes based on it or it will just come under normal income tax depends on your country as well.
Not always. If you bought cryptocurrency for cash or got it for free somewhere like from a giveaway, a faucet, won in an online casino, got it somewhere else where you did not use your bank account or credit card and did not do KYC. In short if you got your crypto anonymously you don't have to report it. It's impossible to trace it back to you as long as you don't sell it for fiat on exchanges. If your situation is different you have to check how your country sees it. Some countries will want only to know about sales for fiat and other will want to know everything. Right on that's what I was thinking
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DireWolfM14
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April 24, 2020, 09:42:31 PM |
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If you live in the usa, you should report all your crypto transactions. I tried to report my crypto purchases this year and last (I do my own taxes) but they didn't care about buying crypto, only selling it for USD. They consider any crypto sales (for fiat) as income, so they want to charge tax on that. I buy more than I sell, but go figure, they don't give you any credit for a "loss" or for buying more than you sell.
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htownad (OP)
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April 24, 2020, 09:51:58 PM |
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If you live in the usa, you should report all your crypto transactions. I tried to report my crypto purchases this year and last (I do my own taxes) but they didn't care about buying crypto, only selling it for USD. They consider any crypto sales (for fiat) as income, so they want to charge tax on that. I buy more than I sell, but go figure, they don't give you any credit for a "loss" or for buying more than you sell. Do you have any good resources for how the tax rate is structured?
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squatter
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April 24, 2020, 10:01:50 PM |
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If you live in the usa, you should report all your crypto transactions. I tried to report my crypto purchases this year and last (I do my own taxes) but they didn't care about buying crypto, only selling it for USD. They consider any crypto sales (for fiat) as income, so they want to charge tax on that. I buy more than I sell, but go figure, they don't give you any credit for a "loss" or for buying more than you sell. You can deduct up to $3,000 a year in capital losses as a casual investor. You can deduct all capital losses if you file as a business. Before anyone rushes off to do the latter, being self-employed means paying an additional 15.3% FICA tax on your income. You can't deduct buys because no taxable transaction occurs until you have sold. There is nothing to deduct. However, if you are required to file Schedule 1 on your tax return for any reason, you now have to answer this question, which applies to buying and holding or receiving giveaways: At any time during 2019, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency? They appear to be building a database of people who own cryptocurrency, whether or not you've triggered taxation.
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DireWolfM14
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April 24, 2020, 10:04:17 PM |
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If you live in the usa, you should report all your crypto transactions. I tried to report my crypto purchases this year and last (I do my own taxes) but they didn't care about buying crypto, only selling it for USD. They consider any crypto sales (for fiat) as income, so they want to charge tax on that. I buy more than I sell, but go figure, they don't give you any credit for a "loss" or for buying more than you sell. Do you have any good resources for how the tax rate is structured? I don't have any concrete information on that. As far as I know it's calculated at the same rate as capitol gains, just like if you made money on investments, and received a 1099-INT for that. You can deduct up to $3,000 a year in capital losses as a casual investor. Really? Is that not subject to being over certain percentage of your AGI? Also, I think that has to realized losses, such as buying Google stock for $400, then selling it later for $389. If the stock goes down, but you still own it, the loss has not been realized.
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squatter
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You can deduct up to $3,000 a year in capital losses as a casual investor. Really? Is that not subject to being over certain percentage of your AGI? See Line 21 of Schedule D. It's not affected by AGI. It's a single line item tax deduction, assuming you had net losses for the year. Also, I think that has to realized losses, such as buying Google stock for $400, then selling it later for $389. If the stock goes down, but you still own it, the loss has not been realized.
Yes, the tax code really only applies to realized gains and losses. You can't deduct buys because no taxable transaction occurs until you have sold. There is nothing to deduct.
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Daniel91
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April 25, 2020, 11:35:12 AM |
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I am not an expert on these issues but in our local Croatian section of the forum we have a person who has already communicated with the tax office and passed us the official opinion of the tax service on bitcoin or crypto earnings. The 2 most important things are that we only pay tax when we exchange crypto to local currency and transfer it to a bank account and we pay 12% tax on it plus City tax (prirez). For more than that it's recommended to find a good accountant.
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