Guys in the US.
Just go and incorporate yourself as a company. LLC, small corp, sole proprietor, doesn't matter. Spend the roughly $120 with the state and become a company. You can afford it since you can afford the miners. It gives you all sorts of tax breaks.
Miners can be computer or manufacturing equipment. Classify it as computer, great, then you can use Section 179 accelerated depreciation schedule. Section 179 lets you deduct a great percentage of the miner market value. This depreciation offsets your BTC income. If you don't have enough BTC income in fiat terms, then it offsets your regular work income.
With a corporate like structure, you can deduct or subtract the electricity cost, internet access cost, network and router switch cost, home cooling cost, trips to BTC convention, gas cost to meetup with your mining buddies, etc. Basically all these cost deductions will more than offset what you made in fiat when your BTC is mined.
Only thing to watch out for is the 3 year guideline. If you don't show a positive book profit after 3 years, then IRS can classify your mining operation as a hobby, and reduce your past deductions. May result in back taxes. One smart person told me, if that happens, then just close up shop (shut down the company) and stop mining. It's not profitable anyway. 3 years is a long time in BTC land...
** Not legal advise. Consult with your CPA or tax lawyer. Keep invoices and receipts when going the corporate route.
yep pretty much what I did (prev posts) and got a bunch of stuff for being a "new business" on startup costs .....not sure what the hell was going on actually but the above
sounds right sole proprietor home business...deductions of miner equipment etc
anyway the CPA seemed like she was having a hell of a lot of fun...tossing money back at me....so whatever...main thing I got form this is "mining' is taxed at 25% gross income...and I made 16k i should have paid 4k in taxes..because the only way I can "make* that gross income as a miner income is to have equip to do so...well...in the end I paid only 550 bucks out of that 4K on my amended tax return
er on a side note...she had me "make a profit" on last years taxes....so I'm not in the hole yet...as to the above comment you have to show a profit in 3 years...
anyway imho worth the 550 extra to amend my taxes just not to have IRS off my back if/when I may sell some coin (as per their property classification) 1 year and 1 day from when I mined it...ie this coming nov/dec
the game will likely change this year again...it is all in flux...so 2014 it likely will be completely different yet again
anyway the CPA seemed to have a good time...was much grinning and chuckling to herself
Searing