Using Bitcoin to Eliminate Profits

[5flags]

Here's fun, how might this work?

I'm a company, I want to reduce my profit to zero to not pay income tax. So at the end of every tax year, I invest my profit in Bitcoins, which are property, rendering a zero profit.

After N years, I "lose" the private key or my coins are "stolen", so we right off the property and close the business down. I now move to another country, miraculously find my private key, tumble the coins and buy a small Island in the South Pacific.

Would this be awesomeness?

[whtchocla7e]

Do that and tell us how it works out for you.

[5flags]

Do that and tell us how it works out for you.

I don't need to. I don't give the illusion of paying taxes

[dogechode]

There's a word for that I think it's fraud? This is similar to someone running up a credit card balance with no intention of paying it, then declaring bankruptcy. If they can prove you did it intentionally, you are in a world of shit.

[nkocevar]

Not a good idea. I'm sure there is some sort of international law that would prevent you from doing this

[5flags]

There's a word for that I think it's fraud? This is similar to someone running up a credit card balance with no intention of paying it, then declaring bankruptcy. If they can prove you did it intentionally, you are in a world of shit.

Of course it would be illegal in the state in which your company was registered...I wasn't suggesting it would be legal. But I was suggesting that you would be in a different country.

[5flags]

Not a good idea. I'm sure there is some sort of international law that would prevent you from doing this

Tax matters aren't governed by international law, but by domestic law and by treaty. If the coins remained dormant for years, how would they know that they weren't actually stolen?

[dogechode]

There's a word for that I think it's fraud? This is similar to someone running up a credit card balance with no intention of paying it, then declaring bankruptcy. If they can prove you did it intentionally, you are in a world of shit.

Of course it would be illegal in the state in which your company was registered...I wasn't suggesting it would be legal. But I was suggesting that you would be in a different country.

Ever heard of extradition? Country B captures you and sends you back to country A to face charges.

[gagalady]

Well, people who really want will always find how to bypass a law. But i doubt this would work

[5flags]

Well, people who really want will always find how to bypass a law. But i doubt this would work

No, probably not My mind just tends to wander in the afternoon...

[nkocevar]

There's a word for that I think it's fraud? This is similar to someone running up a credit card balance with no intention of paying it, then declaring bankruptcy. If they can prove you did it intentionally, you are in a world of shit.

Of course it would be illegal in the state in which your company was registered...I wasn't suggesting it would be legal. But I was suggesting that you would be in a different country.

Ever heard of extradition? Country B captures you and sends you back to country A to face charges.

I was just about to add that in. Im sure any country would want to comply with the US if they asked to extradite you.

[5flags]

Ever heard of extradition? Country B captures you and sends you back to country A to face charges.

Sure, but of course the easiest way to get away with not paying taxes is if the tax man doesn't think you owe him anything. If you "really did lose your private key" - you'd have to write off the coins as a loss.

[5flags]

I was just about to add that in. Im sure any country would want to comply with the US if they asked to extradite you.

Sure, but it's like with anything else - why would they be looking for you? You filed your documents, paid your bill, explained your losses...

[nkocevar]

I was just about to add that in. Im sure any country would want to comply with the US if they asked to extradite you.

Sure, but it's like with anything else - why would they be looking for you? You filed your documents, paid your bill, explained your losses...

Good point. The IRS is too lazy to dig that deep and keep track of you...

[dogechode]

I was just about to add that in. Im sure any country would want to comply with the US if they asked to extradite you.

Sure, but it's like with anything else - why would they be looking for you? You filed your documents, paid your bill, explained your losses...

Well, if you reported some massive loss in terms of bitcoin, especially across multiple years, they might just have the intelligence to note the address the coins were stored in and check up on it in the future, and when they find that there have been outbound transactions from that address since you "lost" the private key...

[zeetubes]

Even better, you could get a commercial mortgage to buy the bitcoins (they're property after all right? :>) and that way you can fuck over both a bank and the IRS. That feeling of a job well done would help sustain you through the tedious days sunning yourself on a yacht somewhere tropical with a hot babe. Supermodels aren't usually the best conversationalists you know.

[mrdeposit]

I was just about to add that in. Im sure any country would want to comply with the US if they asked to extradite you.

Sure, but it's like with anything else - why would they be looking for you? You filed your documents, paid your bill, explained your losses...

Well, if you reported some massive loss in terms of bitcoin, especially across multiple years, they might just have the intelligence to note the address the coins were stored in and check up on it in the future, and when they find that there have been outbound transactions from that address since you "lost" the private key...

There's a way around that. Report them stolen, write it off on the taxes as a lost. Sometime in the future or right now it doesn't matter just send the coins to a new address but use a coin mix site. No way to find out where they went. As far as getting fiat for them, I don't recommend using bank transfers after pulling this off. One is better off exchanging for cash using localbitcoin or some other site.

[DeathAndTaxes]

Investments don't reduce profit.  You would pay taxes on your profit as corporate income and then if you so choose you could invest the after tax earnings.  Of course you could do the same thing as an individual.

[nkocevar]

Even better, you could get a commercial mortgage to buy the bitcoins (they're property after all right? :>) and that way you can fuck over both a bank and the IRS. That feeling of a job well done would help sustain you through the tedious days sunning yourself on a yacht somewhere tropical with a hot babe. Supermodels aren't usually the best conversationalists you know.

Whats better than a supermodel? A supermodel educated on the workings of bitcoin.

[5flags]

Well, if you reported some massive loss in terms of bitcoin, especially across multiple years, they might just have the intelligence to note the address the coins were stored in and check up on it in the future, and when they find that there have been outbound transactions from that address since you "lost" the private key...

Simple. Stage a theft, then tumble the coins, then "notice" the theft and report it as a loss.