iambk
Newbie
Offline
Activity: 36
Merit: 0
|
|
March 26, 2014, 10:08:19 PM |
|
The IRS has simply given us their interpretation of how the existing laws apply to bitcoin. The IRS has said nothing about the practicality of enforcing these laws. These IRS statements give the taxpayer and the IRS auditor guidance. If you follow these IRS guidelines you aren't likely to have any legal complications. If you decide the IRS is wrong and you do get caught then I suppose you could probably bring the IRS to court but it'll be an expensive and uphill battle.
Personally I assumed BTC was subject to capital gains long before this.
|
|
|
|
|
|
|
"With e-currency based on cryptographic proof, without the need to
trust a third party middleman, money can be secure and transactions
effortless." -- Satoshi
|
|
|
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
|
johnyj
Legendary
Offline
Activity: 1988
Merit: 1012
Beyond Imagination
|
|
March 26, 2014, 10:15:44 PM |
|
What if this property is moved oversea and never exchanged at home country? If people avoid centralized exchanges where all the bitcoins can be traced to person, then there is no way to properly identify the ownership of each coin
|
|
|
|
iambk
Newbie
Offline
Activity: 36
Merit: 0
|
|
March 26, 2014, 10:26:10 PM Last edit: March 27, 2014, 12:22:42 AM by iambk |
|
What if this property is moved oversea and never exchanged at home country? If people avoid centralized exchanges where all the bitcoins can be traced to person, then there is no way to properly identify the ownership of each coin
Assuming the property is held by somebody in the US then they are subject to capital gains tax regardless of where the exchange is done. Are there ways to hide income? Sure. But now you're probably also guilty of tax evasion and maybe money laundering. Does it matter if you don't get caught? I guess that's for you to decide. The IRS depends on taxpayers being honest. Many aren't honest. Most probably don't get caught. Some do.
|
|
|
|
bbeagle
Member
Offline
Activity: 63
Merit: 10
|
|
March 26, 2014, 10:59:15 PM |
|
I don't think that is what they are saying though. If that is what they are saying then why bother telling us to base the value on what they were worth at the time they were mined? If what you are saying is accurate then there would be no point in worrying about what they were worth when MINED, only what they were worth when SOLD.
Because if you MINE your bitcoins in 2014 - and say you don't sell any: you OWE TAXES on the mined amount when taxes are due on April 15, 2015. If you eventually sell / trade for goods your bitcoins in 2017, then come April 15, 2018, you ALSO owe taxes on the profit/loss at that point. Only if you mine and sell coins in the same year does the profit/loss equate to only owing taxes on the selling amount. The part that sucks (which particularly happens to people on game shows) - is that you took in some earnings/winnings like a new car worth $30,000. You owe taxes on that gain immediately THAT year (say the bill is $10,000!) You can't afford it, so you MUST sell your car THAT YEAR to pay the tax bill. So winning a $30,000 car is really a headache to come out with $20,000 in cash. Many game shows now award people the cash equivalent of the prize so people can pay the taxes and then use the remaining money to buy what they want.
|
|
|
|
Alley
Legendary
Offline
Activity: 910
Merit: 1000
|
|
March 26, 2014, 11:10:14 PM |
|
If I sell btc on a exchange I will report it. I will not be reporting any capitol gains from anything I buy with btc. As far as the IRS will know my bitcoins will remain forever in cold storage. They simply can't monitor this..
|
|
|
|
MarketNeutral
|
|
March 26, 2014, 11:16:54 PM |
|
This does bring up a existential question on what property really means. Afterall what does it mean to own a bitcoin? In the technical sense it just means knowing the private key to a wallet that has bitcoins; In the literally sense ownership means knowledge. If I were to share my private key with 10 people are they now owners of that wallet or is the wallet still mine ? What if I loose my private key and the bitcoins are lost forever do I still own that wallet , did I ever own that wallet ? I think bitcoin is going to force a fundamental chance on how property is viewed in the world. Its certainly going to be interesting.
I was thinking along the same lines, specifically the philosophical and functionally fundamental aspects of property ownership will inevitably have to be reexamined.
|
|
|
|
iambk
Newbie
Offline
Activity: 36
Merit: 0
|
|
March 26, 2014, 11:31:24 PM |
|
If I sell btc on a exchange I will report it. I will not be reporting any capitol gains from anything I buy with btc. As far as the IRS will know my bitcoins will remain forever in cold storage. They simply can't monitor this..
likewise people living in states with a "use tax" usually don't report their Amazon purchased and pay said use tax. That doesn't mean it isn't the law to pay use tax in some states though.
|
|
|
|
DeathAndTaxes
Donator
Legendary
Offline
Activity: 1218
Merit: 1079
Gerald Davis
|
|
March 26, 2014, 11:58:15 PM |
|
What if this property is moved oversea and never exchanged at home country? If people avoid centralized exchanges where all the bitcoins can be traced to person, then there is no way to properly identify the ownership of each coin
There are lots of ways to cheat on your taxes. It is called tax evasion. There are also lots of ways to legitimately reduce your tax liability. It is called tax avoidance. How difficult it would be for the IRS to catch you cheating is a completely different topic than the tax liability. Tracking cash is also hard. An employer could pay all his employees in cash, keep fake books, and cheat on his taxes that way. It doesn't make the tax liability go away. So keep in mind when you are asking a question, which question are you asking. A US citizen (and in most cases residents) owes US taxes regardless of where the taxable event occurs. It doesn't matter if you leave the US and NEVER come back. The only way to avoid US taxation is to renounce your citizenship (which generally requires you to already have citizenship in another country). Now if you are asking if you could "get away" with traveling to russia to do cash deals for rubbles and then laundering those funds though a bunch of offshore accounts? Maybe but that is asking "will I get caught", not "is this legal". Honestly if it is a small amount of money it probably isn't worth the trouble and if it is a huge amount of money speak to a good offshore lawyer and CPA. Tax avoidance not tax evasion.
|
|
|
|
MarketNeutral
|
|
March 27, 2014, 12:47:14 AM |
|
What if this property is moved oversea and never exchanged at home country? If people avoid centralized exchanges where all the bitcoins can be traced to person, then there is no way to properly identify the ownership of each coin
There are lots of ways to cheat on your taxes. It is called tax evasion. There are also lots of ways to legitimately reduce your tax liability. It is called tax avoidance. How difficult it would be for the IRS to catch you cheating is a completely different topic than the tax liability. Tracking cash is also hard. An employer could pay all his employees in cash, keep fake books, and cheat on his taxes that way. It doesn't make the tax liability go away. So keep in mind when you are asking a question, which question are you asking. A US citizen (and in most cases residents) owes US taxes regardless of where the taxable event occurs. It doesn't matter if you leave the US and NEVER come back. The only way to avoid US taxation is to renounce your citizenship (which generally requires you to already have citizenship in another country). Now if you are asking if you could "get away" with traveling to russia to do cash deals for rubbles and then laundering those funds though a bunch of offshore accounts? Maybe but that is asking "will I get caught", not "is this legal". Honestly if it is a small amount of money it probably isn't worth the trouble and if it is a huge amount of money speak to a good offshore lawyer and CPA. Tax avoidance not tax evasion. Excellent summary of evasion vs. avoidance.
|
|
|
|
minerpumpkin
|
|
March 27, 2014, 12:56:34 AM |
|
Interestingly the markets still don't seem to care...
|
I should have gotten into Bitcoin back in 1992...
|
|
|
marcus_of_augustus
Legendary
Offline
Activity: 3920
Merit: 2348
Eadem mutata resurgo
|
|
March 27, 2014, 01:06:35 AM Last edit: March 27, 2014, 01:58:34 AM by marcus_of_augustus |
|
Question, How is the IRS going to go after all who are mining BTC and how will the IRS go after all of us who purchase goods with BTC. And how will the IRS go after the ones who gamble and receive earnings with BTC What if we all refuse to give any information to the IRS regarding our BTC trades? I say we End The IRS and EndTheFed!! they will make an example of a few people who will be audited comprehensively. once you hear on the news some guy got 20 years in jail for tax fraud because he didn't report his bitcoin capital gains properly you will think twice before attempting this. if you refuse to give the IRS any information they will throw you in jail obviously... the IRS is already guilty as sin for selectively targetting Tea Party groups and other Libertarian-minded organisations in politically motivated ferocious, terrifying audits that drag on for months and sometimes years ... what's changed again? Once the war starts it may behoove you to recall who fired the first shots? Edit: celebrating and cheering on of State sanctioned violence, intimidation and threats of violence for what are essentially acts of civil disobedience is disgusting and downright ghoulish, on a moral par with the Nazis cheering the persecution of Jews.
|
|
|
|
Velkro
Legendary
Offline
Activity: 2296
Merit: 1014
|
|
March 27, 2014, 01:30:41 AM |
|
no matter how you will call it, bitcoin is power Interestingly the markets still don't seem to care...
its like chaos theory, you can't predict it if this news matter or not and to how many people.
|
|
|
|
seriouscoin
|
|
March 27, 2014, 01:33:06 AM |
|
A US citizen (and in most cases residents) owes US taxes regardless of where the taxable event occurs. It doesn't matter if you leave the US and NEVER come back. The only way to avoid US taxation is to renounce your citizenship (which generally requires you to already have citizenship in another country). Now if you are asking if you could "get away" with traveling to russia to do cash deals for rubbles and then laundering those funds though a bunch of offshore accounts? Maybe but that is asking "will I get caught", not "is this legal". Honestly if it is a small amount of money it probably isn't worth the trouble and if it is a huge amount of money speak to a good offshore lawyer and CPA. Tax avoidance not tax evasion.
Actually i was told that i can still keep my citizenship and only pay tax to the primary country if i only stay in US for less than xx days. Many dual citizens do this.
|
|
|
|
BitEscrow
Newbie
Offline
Activity: 42
Merit: 0
|
|
March 27, 2014, 01:35:04 AM |
|
Are you people retarted? "I won't pay my taxes" Har har har... Good luck with that you stupid cunts.
|
|
|
|
gentlemand
Legendary
Offline
Activity: 2590
Merit: 3013
Welt Am Draht
|
|
March 27, 2014, 02:11:50 AM |
|
Are you people retarted? "I won't pay my taxes" Har har har... Good luck with that you silly sausages.
Have you considered going to get some fresh air rather than abusing everyone in sight? It would suit The Man very nicely to steer it into being a commodity rather than currency. Lots of money to be made, little threat to the dollar as a day to day medium of exchange.
|
|
|
|
DeathAndTaxes
Donator
Legendary
Offline
Activity: 1218
Merit: 1079
Gerald Davis
|
|
March 27, 2014, 05:45:05 AM |
|
A US citizen (and in most cases residents) owes US taxes regardless of where the taxable event occurs. It doesn't matter if you leave the US and NEVER come back. The only way to avoid US taxation is to renounce your citizenship (which generally requires you to already have citizenship in another country). Now if you are asking if you could "get away" with traveling to russia to do cash deals for rubbles and then laundering those funds though a bunch of offshore accounts? Maybe but that is asking "will I get caught", not "is this legal". Honestly if it is a small amount of money it probably isn't worth the trouble and if it is a huge amount of money speak to a good offshore lawyer and CPA. Tax avoidance not tax evasion.
Actually i was told that i can still keep my citizenship and only pay tax to the primary country if i only stay in US for less than xx days. Many dual citizens do this. Well the thread was about bitcoin capital gains. Foreign Earned Income "can" be excluded from US taxes but the key word is earned income (i.e. salary or wages). Sadly capital gains, interest, dividends, royalties, etc do not fall under FEIE. It is also possible the US has a tax treaty with another nation where foreign paid taxes reduce (possibly to $0) the US taxes owed. Of course this doesn't save the US taxpayer any money (if you owe $10,000 in US capital gains the only way you pay Uncle Sam $0 is if you paid >=$10,000 taxes to another nation) but it doesn't prevent double taxation (paying $10,000 to France and then having to pay $10,000 to US for the same capital gain).
|
|
|
|
mattdot
Newbie
Offline
Activity: 5
Merit: 0
|
|
March 27, 2014, 05:45:34 AM |
|
So who is going to have fun with the IRS by sending one satoshi back and forth between wallets millions of times and then reporting all those transactions on their taxes?
|
|
|
|
TeeBone
|
|
March 27, 2014, 05:48:33 AM |
|
Are you people retarted? "I won't pay my taxes" Har har har... Good luck with that you stupid cunts.
It's obedient cunts like yourself why the world economy is up shit creek. "Great for bitcoin", "I like paying taxes". Amazing what you read, slaves will be slaves. Let's go chimps, evolve already. I wanna see liberty in my lifetime.
|
|
|
|
southerngentuk
Sr. Member
Offline
Activity: 1316
Merit: 252
Sugars.zone | DatingFi - Earn for Posting
|
|
March 27, 2014, 09:23:09 AM |
|
Can you guys base those earnings on MtGox rates, $122 wasn't it when last traded. Or do you have to base it on the price of an US Exchange Now what if there was only one US Exchange and it was like a fraction of the real price (no buy orders obviously). Are those coins Earned oversea's ? or in the clouds ? So much to go wrong here..
|
SUGAR | | | | ██ ██
██ ██
██ ██
██ ██
██ ██
██ ██ | | | | | | | | | ██ ██
██ ██
██ ██
██ ██
██ ██
██ ██ | | ███████████████████████████ ███████████████████████████ ██████ ██████ ██████ ▄████▀ ██████ ██████▄▄▄███▀ ▄█ ██████ ██████████▀ ▄███ ██████ ████████▀ ▄█████▄▄▄██████ ██████▀ ▄███████▀▀▀██████ ██████ ▀▀▀▀▀▀▀▀▀ ██████ ██████ ██████ ███████████████████████████ ███████████████████████████ | . Backed By ZetaChain | | ██ ██
██ ██
██ ██
██ ██
██ ██
██ ██ | | | | ██ ██
██ ██
██ ██
██ ██
██ ██
██ ██ | | | |
|
|
|
spartacusrex
|
|
March 27, 2014, 09:46:03 AM |
|
Won't this affect Bitcoin's fungibility ?
One Bitcoin won't be the same as another Bitcoin.. since there will be tax to pay on the capital gain.
If you bought a BTC at $10 and another at $100, and now you wanted to spend one to buy a $100 shirt, when the price is 100$/btc.
The 2 bitcoins have different value now..
Is that what they are saying ?
|
Life is Code.
|
|
|
|