Reporting BitCoins on Taxes

[phr0stbyt3]

When I played poker I used Hold'em manager to keep track of my income so I could report it on my tax return... yeah I know, one of the few.

Does a tool like this exist for BitCoin trading?

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[draco49]

When I played poker I used Hold'em manager to keep track of my income so I could report it on my tax return... yeah I know, one of the few.

Does a tool like this exist for BitCoin trading?

Bitcoins are not recognized by the US as a currency or commodity, so there are no governmental laws regulating trade.  If you're concerned about a possibly applicable capital gains tax, that wouldn't apply unless you liquidated your Bitcoins (eg. removing funds from your exchange account).  Even then, there's a question of whether or not a capital gains tax should even be applied to Bitcoin, but we're in uncharted waters and that's a larger question.

If you trade on an exchange, such as mtgox, that would be your best source of records of deposits, withdrawals, and trades.

[phr0stbyt3]

Thanks for the replies.

I paid my accountant $75.00 to tell me that I should report it as misc. income if I cash out bitcoins... lulz.

[TizzyTazzy]

Thanks for the replies.

I paid my accountant $75.00 to tell me that I should report it as misc. income if I cash out bitcoins... lulz.

Anything with value is taxable in the US pretty much..

[Nim]

I'd imagine that you'd follow in the same footsteps as the guys who sell large value items in Second Life. I wonder how long it will be before the IRS starts auditing your digital possessions and transactions. It's coming...

[ZodiacDragon84]

Thanks for the replies.

I paid my accountant $75.00 to tell me that I should report it as misc. income if I cash out bitcoins... lulz.

Anything with value is taxable in the US pretty much..

And that makes me sad. At least groceries are untaxed here in Nebraska. For now.

[Nim]

Thanks for the replies.

I paid my accountant $75.00 to tell me that I should report it as misc. income if I cash out bitcoins... lulz.

Anything with value is taxable in the US pretty much..

And that makes me sad. At least groceries are untaxed here in Nebraska. For now.

I think most states have a similar law and I don't see it as being likely to change. And legislation that hurts the poor or middle class is pretty much political suicide.

[ZodiacDragon84]

but for how long can we go on like we currently are? I gotta pay taxes for shitty roads and my income. I pay more percentage wise on my taxes than multi-millionaires! curses, says I!

[TizzyTazzy]

but for how long can we go on like we currently are? I gotta pay taxes for shitty roads and my income. I pay more percentage wise on my taxes than multi-millionaires! curses, says I!

Curses.. Curses.. 

All well.. What can we do? USE BTC!

[arabianights]

I'm going to conisder BTCs an asset in in the isle of man where I live and where there capittal gains taxes are @ 0%, so won't have to pay any taxes.

[phr0stbyt3]

but for how long can we go on like we currently are? I gotta pay taxes for shitty roads and my income. I pay more percentage wise on my taxes than multi-millionaires! curses, says I!

I started thinking this way the other day. Very depressing. I use such little roads I wish they were all tollways. Pay-Per-Use roads ftw.

[Miner612]

Reoporting Bitcoins for taxes is A GIANT STEP IN THE WRONG DIRECTION.  If that is something you want to do, then please find something else to kill your time with.  Bitcoin is not for you.

PLEASE DO NOT DO THAT, ID10T.

[Kluge]

Reoporting Bitcoins for taxes is A GIANT STEP IN THE WRONG DIRECTION.  If that is something you want to do, then please find something else to kill your time with.  Bitcoin is not for you.

PLEASE DO NOT DO THAT, ID10T.

Speaking of idiots wasting their time...

[Matthew N. Wright]

Reoporting Bitcoins for taxes is A GIANT STEP IN THE WRONG DIRECTION.

Did you pay money for them? Did you make money when you sold them? Then it's expected that you'd pay taxes on the capital gains. Grow up.

[Miner612]

You two are for sure, not welcome in my house.

[Matthew N. Wright]

You two are for sure, not welcome in my house.

That's not nice. I'd invite you into my house if you ever came to South Korea.  

[Miner612]

You two are for sure, not welcome in my house.

That's not nice. I'd invite you into my house if you ever came to South Korea.  

So why do you think we should pay taxes on it, if you don't even live here?  Are you just mad at the world, as usual, today?

So, if I pay taxes on bitcoin, then is the US Government going to back them for me?  Is the government going to take over and operate bitcoin exchanges?  No.  Because they don't give a fuck about digital coins that nerds like us buy and sell.

So please, aim before you shoot a little more.  Your uninformed, thoughtless post was wimpy.

And for the record, I would NEVER, EVER go to Korea LOL wow.  No wonder you are so mad.

[Matthew N. Wright]

So why do you think we should pay taxes on it, if you don't even live here?

LLOLOLOLOLRITE OMG  OMG LOLOLOL


Because I'm a US Citizen, of course.

So, if I pay taxes on bitcoin, then is the US Government going to back them for me?

Does the US back the stock market or silver? No, but you still need to pay capital gains tax when you buy and sell it for a profit.

So please, aim before you shoot a little more.  Your uninformed, thoughtless post was wimpy.
And for the record, I would NEVER, EVER go to Korea LOL wow.  No wonder you are so mad.

You've never actually done your taxes before, have you?

[phr0stbyt3]

Reoporting Bitcoins for taxes is A GIANT STEP IN THE WRONG DIRECTION.

Did you pay money for them? Did you make money when you sold them? Then it's expected that you'd pay taxes on the capital gains. Grow up.

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You've never actually done your taxes before, have you?
[/quote]

Sounds about right.
This is, more or less, the conversation I had with the accountant, and very similar to the conversation I had with him 3 years ago when playing poker online was profitable.

Edit: By the way, I was also advised to not cash out without a substantial bank roll. I usually only cashed out in multiples of $5,000 and reported them in blocks. I suspect the same would be true with MtGox, Tradehill, etc. because it's not income until its in your bank account.

[BadBear]

Wait, you mean not everyone agrees with my ideology? I'm so MAD!