WEB slicer (OP)
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1NF4xXDDpMVmeazJxJDLrFxuJrCAT7CB1b
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June 25, 2014, 11:18:36 PM
Last edit: January 02, 2017, 06:01:23 AM by WEB slicer |
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The trust scores you see are subjective; they will change depending on who you have in your trust list. |
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TheFootMan
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June 26, 2014, 12:00:15 AM |
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i'm sitting on a enough coin to put me in the highest tax bracket. i want to cash out buy rental property and throw money in mutual funds. but i want to do it without getting taxed 40%. my CPA is telling me i have to pay tax twice. once for acquiring the BTC and again when i cash out. that doesn't sound fun. was wondering if anybody here has any experience with BTC and taxes and can share some wisdom about how i can minimize my tax burden.
thanks.
Protip one: Don't reveal on this forum you're loaded. Now you will get friendly advice with links in them to get your ip-adress, then targeted hack attempts.. |
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norgan
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June 26, 2014, 12:11:40 AM |
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i'm sitting on a enough coin to put me in the highest tax bracket. i want to cash out buy rental property and throw money in mutual funds. but i want to do it without getting taxed 40%. my CPA is telling me i have to pay tax twice. once for acquiring the BTC and again when i cash out. that doesn't sound fun. was wondering if anybody here has any experience with BTC and taxes and can share some wisdom about how i can minimize my tax burden.
thanks.
I am not a tax agent and bar far not an expert however I have a theory on this. Since no government (I think) has acknowledged Bitcoin as currency, so long as you hold it in BTC, it essentially does not exist. When you cash it out, it's like receiving a lump sum cash payment form someone, which would need to be declared as income. So at worse you would only pay tax once, unless you declare the BTC at it's fiat value as capital and have to pay capital gains tax. Lots of q's around this obviously but with the right accountant you should be able to limit to paying tax once. |
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AirC
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June 26, 2014, 12:14:02 AM |
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Take small bits into buying a existing internet business, and use that as a solid source to use as for taxes.
Or sell its portions for cash and get into stocks that can be justify as a income source for your house etc.
Bottom line, your trying to clean out your money. Prevention is better then a cure.
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norgan
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June 26, 2014, 12:18:38 AM |
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i also think i should only have to pay tax when i cash out to fiat. but my account with 30 years experience is saying the government considers it investment property. before i can cash it out i have to explain how and when i got it and then i have to pay income tax on it's value when i got it and the difference between what the value was when i got it and the value is when i cash out is capital gains.
is it all mined? if so then you have generated new cash right? how can that be an investment if you have not paid for it? the mining hardware is a capital investment sure. If on the other hand you bought into it and made profit then it would be no different to any other commodity such as gold, silver or other. |
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TheFootMan
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June 26, 2014, 12:19:48 AM |
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i'm on a neighbors wifi, i know better than to click links, my wallet is encrypted, the bulk of my BTC is not on my computer, it's in a safety deposit box.
That's great. Sadly not everybody is that careful!  Best wishes! |
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bitgeek
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June 26, 2014, 12:35:09 AM |
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In my country money earned from sex is not taxable. Just saying  |
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TheFootMan
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June 26, 2014, 12:38:18 AM |
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In my country money earned from sex is not taxable. Just saying You sayin' he should start pimpin'? |
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WEB slicer (OP)
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1NF4xXDDpMVmeazJxJDLrFxuJrCAT7CB1b
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June 26, 2014, 12:43:10 AM |
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let's stay on topic guys.
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norgan
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June 26, 2014, 12:51:34 AM |
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is it all mined? if so then you have generated new cash right? how can that be an investment if you have not paid for it? the mining hardware is a capital investment sure.
If on the other hand you bought into it and made profit then it would be no different to any other commodity such as gold, silver or other.
if you google search bitcoin taxes you will see several articles about how the government is considering it an investment property like stocks. it's not money but it's worth money so you have to pay tax when you acquire it. before you can get to the point of investing in stocks you have to report where you got the money from and pay taxes on it. you can't skip that step and throw the money straight in stocks without reporting the source of the funds. this is what i am being told. yes but is it mined or purchased btc? if you mine it, I can't se how they can consider it anything other than the money invested in hardware and when you finallt convert it to fiat. If you purchase Bitcoin then fair enough, you've invested in a commodity. |
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norgan
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June 26, 2014, 01:05:05 AM |
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yes but is it mined or purchased btc? if you mine it, I can't se how they can consider it anything other than the money invested in hardware and when you finallt convert it to fiat.
If you purchase Bitcoin then fair enough, you've invested in a commodity.
i would rather not say cause i'm not sure how i'm going to report it. i don't see how the IRS expects tax on something that came out of thin air and was not purchased but i do see them pursuing every single angle of acquisition regardless of how i got it. they want their cut. period. i guess it's like inheriting a million dollars or old paintings that are worth a million. you didn't work for it and you didn't invest for it but it fell in your lap it's worth alot of money and they want a piece of it. See in Australia lottery winnings are not taxed, nor are other prizes. So, if you could extend that to "I won a block" then is it winnings, investment, capital or other? |
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deebob
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June 26, 2014, 01:39:05 AM |
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I thought most wont even consider an audit since we just laid off a lot of IRS agents lol.
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zedicus
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CryptoTalk.Org - Get Paid for every Post!
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June 26, 2014, 01:45:01 AM |
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Buy the rental property in bitcoin directly!
No cashing out required!
The real cashing out is actually not having too..
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KonstantinosM
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June 26, 2014, 01:53:35 AM |
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Buy the rental property in bitcoin directly!
No cashing out required!
The real cashing out is actually not having too..
Either that or (Very off topic) perhaps taxation should be simplified and be made fair across the bord. Like a flat value added tax on everything.... The rich, corporations, the poor, anyone pays the same % on every transaction. Back on topic, you can buy any asset that is taxed very little sell it at a slight loss (smaller than the other tax) to an interested buyer (pre-arranged). The item would be any such thing you can buy for BTC although at this early stage that would be quite difficult an asset such as a certain amount of gold or silver could be used. You use BTC to get the gold, you give it to whomever who buys it for fiat. BTC to Gold to Fiat.... |
Syscoin has the best of Bitcoin and Ethereum in one place, it's merge mined with Bitcoin so it is plugged into Bitcoin's ecosystem and takes full advantage of it's POW while rewarding Bitcoin miners with Syscoin
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bitbaby
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June 26, 2014, 02:39:46 AM |
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my CPA did mention it would be more cost effective to skip the cash out and straight trade my BTC for property but it's going to be very hard to accomplish this.
Difficult? more like impossible, the person selling you the property will have to declare the sale to the government and how much money he sold it for and to who and it can't be hidden. So even if you purchase it off the bitcoin you'd still have to pay the taxes for, buying bitcoin, selling bitcoin and most prolly for purchasing the property too. |
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zedicus
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June 26, 2014, 02:43:28 AM |
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bitbaby
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June 26, 2014, 04:30:16 AM |
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Difficult? more like impossible, the person selling you the property will have to declare the sale to the government and how much money he sold it for and to who and it can't be hidden. So even if you purchase it off the bitcoin you'd still have to pay the taxes for, buying bitcoin, selling bitcoin and most prolly for purchasing the property too.
very difficult, but not impossible. i have seen people here selling land and homes for BTC. i have also seen a guy list his million dollar apartment across from central park for BTC only. any transfer of property would obviously have to be declared. but if i traded BTC i would only have to pay for the acquisition of the BTC and the acquisition of the property. this would effectively skip the cashing out tax. Well that's true it will leave out the sell btc tax and I think that's the best option, everything else would be a bit illegal. But it can still be tricky you might also have to detail them on where you got the money to acquire that much BTC. |
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WEB slicer (OP)
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1NF4xXDDpMVmeazJxJDLrFxuJrCAT7CB1b
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June 26, 2014, 04:32:38 AM |
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maybe i mined it? maybe i spent $1000 on BTC when the price was at $2?
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bitbaby
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June 26, 2014, 05:16:06 AM |
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Yeah you could say that you bought it real cheap in the market when it was $2 but I don't know if they will ask for some proofs regarding that or not.
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Kprawn
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June 26, 2014, 06:54:22 AM |
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Do you have to cash out, all at once? If you released smaller amounts every year, it would be a more manageable tax bracket. And I agree with you, once it's converted to fiat, it's taxable. {Capital gains etc} You should go speak to them, and negotiate a reasonable payback rate, and factor in the tax, you would have to pay, and subtract it from your coins. Trying to evade tax, would just end up wrong for you. I would buy stuff for friends at discount, and cash in on the favor later. |
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