Tax free crypto idea

[roxane40]

I set up a wallet using a Switzerland address. But I used my American passport, American tax id #, and American bank account. If I buy and sell crypto (in Switzerland, because my address is a Swiss address), are there no capital gains technically? Then I simply deposit the funds to my bank account tax free? Is this true?

[franky1]

nope
as soon as you convert to US$ to put into US$ bank account, you have to declare on US tax form how you got those funds.

there is no such thing as a Swiss wallet.
bitcoin wallets are not country specific

also a 0.1second google search

Americans must pay U.S. taxes on foreign income. The U.S. is one of only two countries in the world where taxes are based on citizenship, not place of residency. If you're considered a U.S. citizen or U.S. permanent resident, you pay income tax regardless where the income was earned.

what the elites do in assets-> fiat, is this:
image elon musk has BILLIONS of value stuck in shares, but doesnt want to get taxed when cashing them out, to then buy twitter
instead of "selling" his shares. he takes a loan for the amount the shares are worth using the shares as the collateral and on receipt of the loan US$ he then settles the loan by relinquishing control of the shares to the loaner

loans are not taxable

so there could be opportunity for a market to instead of offer a service to sell bitcoin. instead offer a $$ loan that settles in bitcoin
where by you deposit coin into the market. agree on the value amount. the service gives you a loan(money plus some paper that declares it as a loan and not a payment) and then they keep the coin
yes its pretty much the same process of selling coin.. but just bureaucratically different by way of having a loan agreement piece of paper instead of a payment receipt piece of paper

yep wording of a piece of paper can save alot of tax

disclaimer:
i am not offering professional tax advice, this is just laymen speak of what i see elites do based on experience, observation and research, speak to a tax expert of the particulars of personal loans and practicalities..

[roxane40]

So what about if I sell them with my Swiss-addressed wallet, then gift the cash to my American addressed Coinbase.com account? There’s no tax in America on gifts received. But they do have to be reported.

[Charles-Tim]

It would be better to get a crypto tax accountant if you need more clarity on how crypto tax should be. I do not know what to call them actually but I think you understand what I mean.

What I think is that if you are from Switzerland and dealing with what is about your account in Switzerland, you will follow the rules in Switzerland. And if you are now in US, follow US laws with what you use your identities with like American bank account.

If it is your Swiss address with AOPP and the money is not leaving what is connected to you in Switzerland, follow Switzerland rules. But once it leaves your account in Switzerland to any account like custodial wallet or exchanges in the US, follow US rules.

[roxane40]

So what about if I sell them with my Swiss-addressed wallet, then gift the cash to my American addressed Coinbase.com account? There’s no tax in America on gifts received. But they do have to be reported.

So this is a good idea? Buy and sell with Swiss addressed wallet, then gift to American Coinbase.com and cash out tax free, reporting my income as a gift on my American tax return?

[LoyceV]

Are you looking for a legal tax loophole, or are you looking for tax evasion?

[roxane40]

Tax loophole. Not evasion. I think it’s the perfect scenario. Buy and sell with Swiss addressed wallet, gift the cash to American Coinbase.com and cash out, tax free, but report the gift on American tax return.

[franky1]

So what about if I sell them with my Swiss-addressed wallet, then gift the cash to my American addressed Coinbase.com account? There’s no tax in America on gifts received. But they do have to be reported.

So this is a good idea? Buy and sell with Swiss addressed wallet, then gift to American Coinbase.com and cash out tax free, reporting my income as a gift on my American tax return?

coinbase wont report it on their end as a "gift" and so when they do their compliance reporting on their customers the IRS sees the value as not a gift. so when you try to declare it as a gift on your own tax filing it will cause a discrepancy which can trigger a tax audit of all your other financial activities

this is where evasion and avoidance are different.
you making up reasons that dont match the bureaucracy the IRS gathers from other sources causes evasion suspicions. where as having proof of for instance a loan, then works in your favour.
you cant just gain profit and declare it as a gift to yourself. and services like exchanges wont declare their withdrawals to you as gifts
also gifts have a monetary limit too

you really should seek advice from a professional tax adviser to avoid the trouble of tax evasion

[LoyceV]

Tax loophole. Not evasion. I think it’s the perfect scenario. Buy and sell with Swiss addressed wallet, gift the cash to American Coinbase.com and cash out, tax free, but report the gift on American tax return.

So you want to give yourself a gift for tax reasons? I don't know much about US tax laws, but this sounds a lot like tax evasion.

also gifts have a monetary limit too

I'm not US-based, but here gifts from abroad are tax-free without a limit. However, if you claim to have received a $10M gift from someone, you can expect a lot of questions and better have your paperwork in order.

[peter0425]

I set up a wallet using a Switzerland address. But I used my American passport, American tax id #, and American bank account. If I buy and sell crypto (in Switzerland, because my address is a Swiss address), are there no capital gains technically? Then I simply deposit the funds to my bank account tax free? Is this true?

It depends which country you are a citizen of.

If you are an American citizen, I don’t think it matters where your income was made. You are going to have to pay in us dollars as they impose their tax laws to you. Especially if your bank account is also American.

If you want to follow Swiss laws as an American citizen, you are going to have to file something of a foreign asset.

[Xampeuu]

In my country, tax will still be charged, because every person who is registered will automatically be deducted from tax, and in one year there will also be personal tax imposed but with the applicable provisions, especially if we buy property, of course we will know at least how much The amount of income we earn, therefore I think it depends on the tax regulations in your place

[Apocollapse]

If you don't have a lot money or business, your option would be very limited to find the loophole. The most easiest way is to hold at least a year and earn up to $47K.

If you have business you can manipulate your financial statement, you can use religious organization or charitable organization to exempt tax.

But, it's only for the rich, for low or middle class people you can use the first one or use Cash by Mail method.

[Charles-Tim]

Tax loophole. Not evasion. I think it’s the perfect scenario. Buy and sell with Swiss addressed wallet, gift the cash to American Coinbase.com and cash out, tax free, but report the gift on American tax return.

So you want to give yourself a gift for tax reasons? I don't know much about US tax laws, but this sounds a lot like tax evasion.

What some people will call tax loopholes is what they will use to evade tax without being noticed or detected. This is just what this is in my opinion.

[NotFuzzyWarm]

What some people will call tax loopholes is what they will use to evade tax without being noticed or detected.

Wrong.
A loophole is an unusual but still legal way to reduce tax exposure by using, well, loopholes in the existing tax laws. It should be noted that using loopholes typically increases the attention of tax authorities because they will do their best in trying to prove the loopholes do not apply to you. That said, with proper care in setting up your accounting procedures and keeping good documentation you can prove that you are working within the laws.

Evasion is an outright breaking of the laws.

[SamReomo]

I don't think you'll be able to make your crypto tax free. The best way to make your crypto tax free is by hiding it from the government and that will fall into tax evasion somehow, and such act may break the laws.

I'm not an expert of tax laws but I'm very sure that someone with American passport won't be able to dodge the government with the tax loopholes. I know what you said isn't tax evasion at all but you won't be able to find such loopholes easily.

[KingsDen]

What some people will call tax loopholes is what they will use to evade tax without being noticed or detected.

Wrong.
A loophole is an unusual but still legal way to reduce tax exposure by using, well, loopholes in the existing tax laws. It should be noted that using loopholes typically increases the attention of tax authorities because they will do their best in trying to prove the loopholes do not apply to you. That said, with proper care in setting up your accounting procedures and keeping good documentation you can prove that you are working within the laws.

Evasion is an outright breaking of the laws.

Since you said finding and using taxation loopholes is not tax evasion, are their agencies where people legally go to acquire the services of a tax loophole specialist?

I'm not an expert of tax laws but I'm very sure that someone with American passport won't be able to dodge the government with the tax loopholes. I know what you said isn't tax evasion at all but you won't be able to find such loopholes easily.

It seems that the loopholes are normally used by the rich and not an average citizen. At a point the government will even help you to discover existing loopholes for you.

[Poker Player]

It is a very crude way of trying to evade taxes. If you do not have tax residency in Switzerland what you are doing is breaking the law. As long as you have US tax residency, if you buy a dog shit in Mogadishu for $1 and sell it for $1M you owe capital gains tax to the IRS. And that you are going to make a gift to yourself with the $999,999 you made from selling the dog shit has all the earmarks of a ridiculous attempt to evade taxes.

[NotFuzzyWarm]

<snip>
Since you said finding and using taxation loopholes is not tax evasion, are their agencies where people legally go to acquire the services of a tax loophole specialist?

...
It seems that the loopholes are normally used by the rich and not an average citizen. At a point the government will even help you to discover existing loopholes for you.

If you mean government agencies - no. The reason 'rich people' can possibly take advantage of loopholes is because they hire tax attorneys, bookkeepers and consultants to find the loopholes and setup their finances accordingly to take advantage of them.

As for:

At a point the government will even help you to discover existing loopholes for you.

No they won't. That is the job of folks like H&R Block et al who prepare your taxes. The only problem with them is that said companies will go strictly by-the-book and will NOT try to push the limits of what you can deduct. Their primary job is to be sure you have no problems with filing your taxes - not work with you in setting up your finances.

However that said, many tax attorneys and most high-priced tax consultants are former IRS agents who have deep knowledge of tax law so they know what you can and cannot get away with to reduce tax exposure. Remember, the definition of 'loophole' is an ambiguity or inadequacy in the law or a set of rules -- in other words they deal with very specific situations where the law is not clear and they will structure your finances so questions and subsequent rulings from the IRS (usually) go in your favor. They are very good at what they do and charge accordingly (not cheap!).

[chateaux]

Boils down to the person making the trades and who owns the assets. If you want to save on taxes, then put a structure in place that is more tax efficient. That person does the trades - pays its taxes, then pays you your salary (on which you pay your taxes).

[goldkingcoiner]

I set up a wallet using a Switzerland address. But I used my American passport, American tax id #, and American bank account. If I buy and sell crypto (in Switzerland, because my address is a Swiss address), are there no capital gains technically? Then I simply deposit the funds to my bank account tax free? Is this true?

There is no such thing as a wallet with a physical address. It is your wallet and unless you let somebody know that it is your wallet then they will not know who the wallet belongs to or where it was set up.

I assume you meant you set up a wallet on a crypto exchange. In that case, the exchange has full view and control over your deposited funds and your identification documents. They are also going to give that information to your government. And if they decide to freeze your account and your funds, there will be nothing you can do to stop them.

Stay away from centralized/custodial exchanges and/or wallets.