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Author Topic: Bitcoin is hardly "doomed" because of the IRS ruling  (Read 3456 times)
s_s
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March 27, 2014, 08:21:27 PM
 #21


There is also the issue of being a money transmitter that goes away, which is also good.

Lets see how long it takes for this to sink in.

That sounds right, if it is not money then moving bitcoins around does not make you a money transmitter. So that should open the doors to a lot more business and make it easier to shift funds in/out of BTC - and other altcoins.

There is nothing to say that one segment of the government might choose to treat it like as asset...and another segment of the government choosing to treat it as money I suppose? I mean let's me honest there are lots of inconsistencies throughout enforcement of federal regulations.
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Doug Rudd
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March 27, 2014, 08:30:09 PM
 #22

why would anyone choose to use bitcoin now.

Because it's best use cases have nothing to do with using it as daily spending money.

Its best use case is money laundering. It is worth more for that than anything else.
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March 27, 2014, 08:32:33 PM
 #23


There is also the issue of being a money transmitter that goes away, which is also good.

Lets see how long it takes for this to sink in.

That sounds right, if it is not money then moving bitcoins around does not make you a money transmitter. So that should open the doors to a lot more business and make it easier to shift funds in/out of BTC - and other altcoins.

There is nothing to say that one segment of the government might choose to treat it like as asset...and another segment of the government choosing to treat it as money I suppose? I mean let's me honest there are lots of inconsistencies throughout enforcement of federal regulations.

You'd think a lawsuit would force clarity and consistency, though. I doubt a decent judge, confronted with such a contradiction, would allow it to stand.

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Robert Paulson
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March 27, 2014, 08:33:29 PM
 #24


There is also the issue of being a money transmitter that goes away, which is also good.

Lets see how long it takes for this to sink in.

That sounds right, if it is not money then moving bitcoins around does not make you a money transmitter. So that should open the doors to a lot more business and make it easier to shift funds in/out of BTC - and other altcoins.

There is nothing to say that one segment of the government might choose to treat it like as asset...and another segment of the government choosing to treat it as money I suppose? I mean let's me honest there are lots of inconsistencies throughout enforcement of federal regulations.

each segment chooses to view it in a way that will be the most crippling for bitcoin without outright banning it.
the way the situation stands today Fincen wants exchanges to register as MSB's thus treating bitcoin as money and forcing them to spend millions on compliance or shut down.
the IRS treats it as a commodity thus forcing people to track capital gains whenever they use bitcoin to buy something.
s_s
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March 27, 2014, 08:45:00 PM
 #25


There is also the issue of being a money transmitter that goes away, which is also good.

Lets see how long it takes for this to sink in.

That sounds right, if it is not money then moving bitcoins around does not make you a money transmitter. So that should open the doors to a lot more business and make it easier to shift funds in/out of BTC - and other altcoins.

There is nothing to say that one segment of the government might choose to treat it like as asset...and another segment of the government choosing to treat it as money I suppose? I mean let's me honest there are lots of inconsistencies throughout enforcement of federal regulations.

You'd think a lawsuit would force clarity and consistency, though. I doubt a decent judge, confronted with such a contradiction, would allow it to stand.

Agreed...and that likely will happen over time. It is a disruptive technology and it's not surprising that existing rules and regulations don't easily fit to it.
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March 27, 2014, 08:47:04 PM
 #26

let be more clear : IRS do his job because they have ALL VISIBILITY of your account at your bank.

bitcoin  (or bitmixer  Grin ) don't allow this. Roll Eyes
balanghai
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March 27, 2014, 09:01:25 PM
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So what's next? Will it encourage or discourage the American crowd?

1 BITCOIN bisa beli Berapa Bungkus MICIN ?
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March 27, 2014, 09:07:52 PM
 #28

so ... at your point, encourage the FIAT joke is a good thing ? If you rich, i understand ... but i'm poor, so when money crash (paper money) ... bitcoin is on the rail to shutdown the all visa-mastercard system based on FIAT money.
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March 30, 2014, 01:04:16 AM
 #29



For a good look at the currency of the future take a look at  Mintcoin  It's a new energy efficient Eco friendly coin with a growing number of Merchants and services. Very fast secure and good for the planet!
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March 30, 2014, 01:11:33 AM
 #30

Correct me if I'm wrong please,  but is this saying that every time you make a purchase using bitcoin you have to pay capital gains taxes if the value of bitcoin increased Huh  Wouldn't that make it pointless to use bitcoin as a means to buy things?

Well it is a 'problem' but I think there will be wallets or software to track that if necessary.

It's not like everyone follows the tax law to the letter. Just look at the so called
"Use tax" where you are supposed to send in your sales tax to state A if you bought in state B
Where the tax was less and used in state A.  Almost no one does that even though it's the law.
They only enforce it (and are able to enforce it) with large purchases like cars because you need paperwork
To register a car.  Similar thing will happen with bitcoin.

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March 30, 2014, 01:22:00 AM
 #31

why would anyone choose to use bitcoin now.
Because after the dollar implodes they won't have any choice.

Remember Aaron Swartz, a 26 year old computer scientist who died defending the free flow of information.
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March 30, 2014, 01:33:11 AM
 #32

I thought that how capital gains work is that come tax time you you add up how much you have and if it is more than you had then you pay tax on the difference?

Or actually come to think of it I also had the impression that until you sell, it doesn't even count?

If I own stocks and shares, do I pay tax each year or declare a deduction each year due to its purported market value changing?

Or take for example a house.

I bought a house, fine and dandy.

I do not pay capital gains tax each year when the house changes in market value, nor do I pay capital gains tax when I sell a few hours days or months of the house or a room in the house.

Nor do I pay capital gains when I pull off a piece of its gutter and sell that, nor when I knock down a wall and sell the bricks or lathes or whatever.

I do not even pay capital gains when I mow the garden and sell the resulting hay, vegetables and such, nor when I dig up some soil and sell that, nor when I grind some rocks from the garden into gravel, and so on and so on and so on.

Thus my impression of capital gains tax is that at tax time when I add up how much fiat I acquired and how much fiat worth of goods and services I acquired (such as by barter) and subtract how much fiat (or fiat value in barter) I spent on expenses in order to perform my business of acquiring such things, if my gain/income minus the necessary/declarable expenses is a positive sum I need to pay income or capital gains tax on it. Thus the only burden of bitcoin sales/barter counting as capital gain rather than income lies in my desire to pay lower taxes by mentioning that some of my gain was a capital gain instead of a plain old income?

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Bit_Happy
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March 30, 2014, 01:59:51 AM
 #33


There is also the issue of being a money transmitter that goes away, which is also good.

Lets see how long it takes for this to sink in.

That sounds right, if it is not money then moving bitcoins around does not make you a money transmitter. So that should open the doors to a lot more business and make it easier to shift funds in/out of BTC - and other altcoins.

There is nothing to say that one segment of the government might choose to treat it like as asset...and another segment of the government choosing to treat it as money I suppose? I mean let's me honest there are lots of inconsistencies throughout enforcement of federal regulations.

each segment chooses to view it in a way that will be the most crippling for bitcoin without outright banning it.
the way the situation stands today Fincen wants exchanges to register as MSB's thus treating bitcoin as money and forcing them to spend millions on compliance or shut down.
the IRS treats it as a commodity thus forcing people to track capital gains whenever they use bitcoin to buy something.

Brilliant.
Proof the Gov is not always incompetent.

jonald_fyookball
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March 30, 2014, 03:16:16 AM
 #34

I thought that how capital gains work is that come tax time you you add up how much you have and if it is more than you had then you pay tax on the difference?

Or actually come to think of it I also had the impression that until you sell, it doesn't even count?

If I own stocks and shares, do I pay tax each year or declare a deduction each year due to its purported market value changing?

Or take for example a house.

I bought a house, fine and dandy.

I do not pay capital gains tax each year when the house changes in market value, nor do I pay capital gains tax when I sell a few hours days or months of the house or a room in the house.

Nor do I pay capital gains when I pull off a piece of its gutter and sell that, nor when I knock down a wall and sell the bricks or lathes or whatever.

I do not even pay capital gains when I mow the garden and sell the resulting hay, vegetables and such, nor when I dig up some soil and sell that, nor when I grind some rocks from the garden into gravel, and so on and so on and so on.

Thus my impression of capital gains tax is that at tax time when I add up how much fiat I acquired and how much fiat worth of goods and services I acquired (such as by barter) and subtract how much fiat (or fiat value in barter) I spent on expenses in order to perform my business of acquiring such things, if my gain/income minus the necessary/declarable expenses is a positive sum I need to pay income or capital gains tax on it. Thus the only burden of bitcoin sales/barter counting as capital gain rather than income lies in my desire to pay lower taxes by mentioning that some of my gain was a capital gain instead of a plain old income?

-MarkM-


You would only pay cap gains when you sell the house ( and there's up to a $500,000 exemption)

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March 30, 2014, 03:29:09 AM
 #35

this is not what satoshi intended when he created bitcoin.
bitcoin was supposed to replace fiat money and remove the banker's power to print money at will.
if all bitcoin is good for is sending money abroad cheaper than western union/bank wire transfer then bitcoin is failing its mission.

Whether you are right or wrong about satoshi's goals for Bitcoin, it doesn't matter. Bitcoin does replace fiat money in some use cases. I'm not comfortable using fiat money as a store of value, it's far too dangerous (whether I rely on banks or not) and it's most likely only going to lose value over time. Most assets I don't actually own, so Bitcoin has a nice role as an asset that I have complete control over. That kind of control is valuable to the right person.

LOL @ bitcoin as a store of value.

It's one of the most speculative and risky things available right now.

It's the equivalent of investing in a startup tech company that you think is promising and are hoping is going to become the next google.
Peter R
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March 30, 2014, 03:43:53 AM
 #36

LOL @ bitcoin as a store of value.

Can you think of another asset that enables you to store value more securely than bitcoin?  

For example, I may or may not have a large amount of bitcoins stored in my brain right now and no one can take those from me without my permission.  I could wash up on a beach in a foreign country, with tattered clothes, without ID or any other personal belongings, and if I can gain access to a computer with an internet connection I could still access my stored value.

Can you think of another way to store value like this?

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cryptoanarchist
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March 30, 2014, 03:46:58 AM
 #37

All I can figure is that the "bitcoin is doomed by IRS" posts have a lot to do with the influx of noobs around here.

The IRS may as well have said that they were going to tax the moon. It would be easier than collecting bitcoin taxes.
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March 31, 2014, 12:38:45 PM
 #38

For me, bitcoin, although taxed and incorporated into federal monetary system, will still keep it's best property: The government cannot print more bitcoins.

So, while they still use dollars because of this perk, bitcoin will have a wider, more respected environment for growing.
When it takes over, govt will HAVE to balance it's budget, hold it's spending, or overtax people, which will bring up to sight the reality that increasing public spending eventually crashes the economy.
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March 31, 2014, 02:36:27 PM
 #39

The last fail of the United States, which will ultimately lead to dismiss of their diminishing global power.
Together with the G20 rejecting dollar!

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amspir
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March 31, 2014, 03:31:28 PM
 #40

For example, I may or may not have a large amount of bitcoins stored in my brain right now and no one can take those from me without my permission.  I could wash up on a beach in a foreign country, with tattered clothes, without ID or any other personal belongings, and if I can gain access to a computer with an internet connection I could still access my stored value.

If you lose your memory (though highly unlikely) you might be in trouble.   I decided to keep mine on paper in a fireproof safe, so my descendent can access it in the event of my demise.


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