Since you're here, want to tell us the full story?
I'll just point out that Beacon has said nothing so far that isn't publicly available info.
Clearly not. But maybe he will.
Topic: Anyone know what happened to knightmb and his 371,000 BTC? - page 15. (Read 81600 times)
I'll just point out that Beacon has said nothing so far that isn't publicly available info.
Clearly not. But maybe he will.
without commenting on this particular case, much of what people are saying about united states taxes in bitcoin-forum discussions is wrong.
in the united states, you owe income taxes on property you acquire from any source (except gifts and a small number of other exclusions). you don't get to wait until you convert it into cash. people who say that are confusing capital-gain-realization rules for income rules.
for example, if you find treasure in your backyard, you have taxable income. if you mine gold, you have taxable income, unless there are special mining laws that tax it differently. if you install linux for someone and they pay you in sdram, you have taxable income. taxes are computed at the fair market value (in dollars) at the time you acquire the property. you don't have to sell it in any of these cases to have federal income tax.
see http://www.irs.gov/publications/p17/ch12.html
states in the us often have transfer taxes for business sales, and the transfer taxes may depend on the fair market value of the assets.
update: to be clear, i'm not commenting on this case or saying that anyone said anything wrong here. i just wanted to provide general information to correct what i've perceived as a general mistake in forum discussions. if i had to guess about this particular case, i'd think it's possible someone does owe taxes on the mining 'income' regardless of sale, based on the value when it was mined. i don't know if it's the buyer or the seller of the business, and i agree that it's all probably a grey area.
in the united states, you owe income taxes on property you acquire from any source (except gifts and a small number of other exclusions). you don't get to wait until you convert it into cash. people who say that are confusing capital-gain-realization rules for income rules.
for example, if you find treasure in your backyard, you have taxable income. if you mine gold, you have taxable income, unless there are special mining laws that tax it differently. if you install linux for someone and they pay you in sdram, you have taxable income. taxes are computed at the fair market value (in dollars) at the time you acquire the property. you don't have to sell it in any of these cases to have federal income tax.
see http://www.irs.gov/publications/p17/ch12.html
states in the us often have transfer taxes for business sales, and the transfer taxes may depend on the fair market value of the assets.
update: to be clear, i'm not commenting on this case or saying that anyone said anything wrong here. i just wanted to provide general information to correct what i've perceived as a general mistake in forum discussions. if i had to guess about this particular case, i'd think it's possible someone does owe taxes on the mining 'income' regardless of sale, based on the value when it was mined. i don't know if it's the buyer or the seller of the business, and i agree that it's all probably a grey area.
Since you're here, want to tell us the full story?
I'll just point out that Beacon has said nothing so far that isn't publicly available info.
Bitcoins were also worth a lot less in Feb when knightmb did the deal. I hope everything works out for everyone.
That's not the impression I get. I think this deal just happened.
Good news for me anyway 
, they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.
I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
, they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
Michael Brown (knightmb), you have not told the full story here, and this is not the first time you have screwed an employer. If you do not do the right thing now, this will come back to haunt you.
You are also in over your head. Has it occurred to you that you owe $850,000 of federal income tax on this "deal"? Fortunately for you, we do not have state tax in Tennessee, but you will still owe business taxes, and you haven't even applied for the right licenses.
You have one chance to do the right thing here. You know what it is.
Since you're here, want to tell us the full story?
For your own sake knightmb, I hope you spent roughly triple that on iron-tight mutual indemnifications. If not, here is my advice (I'm not a lawyer, btw):
1. Get a lawyer, right now
2. On review, figure out if you need to get a settlement in place which covers all mutual indemnifications.
3. Get those things locked down. You will likely have to pay some of your $3m USD in earnings to get that sorted.
When you have a technical partner knowingly buying assets from non-technical partners for pennies on the dollar, there may well be significant repercussions. And, as someone here mentioned, it's also just kind of shitty.
Food for thought.
For those mentioning taxes -- unless he's selling his BTC, he likely doesn't have a requirement to mark his BTC to market; this is no doubt a gray area in the tax law right now. I wouldn't say he owes right now unless he's liquidating.
Good point on the knowingly buying assets without revealing information. I believe there are laws against doing this, which would mean that knightmb is kind of screwed if/when the other company partners find out.1. Get a lawyer, right now
2. On review, figure out if you need to get a settlement in place which covers all mutual indemnifications.
3. Get those things locked down. You will likely have to pay some of your $3m USD in earnings to get that sorted.
When you have a technical partner knowingly buying assets from non-technical partners for pennies on the dollar, there may well be significant repercussions. And, as someone here mentioned, it's also just kind of shitty.
Food for thought.
For those mentioning taxes -- unless he's selling his BTC, he likely doesn't have a requirement to mark his BTC to market; this is no doubt a gray area in the tax law right now. I wouldn't say he owes right now unless he's liquidating.
Bitcoins were also worth a lot less in Feb when knightmb did the deal. I hope everything works out for everyone.
This is amazing. It's probably best your wife doesn't get it or she might insist on getting some of those paper dollars.
I can't believe you didn't even give them their 12k back! Maybe you can't offer too much without making them suspicious? How did you ever talk these people into putting up money for something they had no interest in?
I can't believe you didn't even give them their 12k back! Maybe you can't offer too much without making them suspicious? How did you ever talk these people into putting up money for something they had no interest in?
For your own sake knightmb, I hope you spent roughly triple that on iron-tight mutual indemnifications. If not, here is my advice (I'm not a lawyer, btw):
1. Get a lawyer, right now
2. On review, figure out if you need to get a settlement in place which covers all mutual indemnifications.
3. Get those things locked down. You will likely have to pay some of your $3m USD in earnings to get that sorted.
When you have a technical partner knowingly buying assets from non-technical partners for pennies on the dollar, there may well be significant repercussions. And, as someone here mentioned, it's also just kind of shitty.
Food for thought.
For those mentioning taxes -- unless he's selling his BTC, he likely doesn't have a requirement to mark his BTC to market; this is no doubt a gray area in the tax law right now. I wouldn't say he owes right now unless he's liquidating.
Good point on the knowingly buying assets without revealing information. I believe there are laws against doing this, which would mean that knightmb is kind of screwed if/when the other company partners find out. 1. Get a lawyer, right now
2. On review, figure out if you need to get a settlement in place which covers all mutual indemnifications.
3. Get those things locked down. You will likely have to pay some of your $3m USD in earnings to get that sorted.
When you have a technical partner knowingly buying assets from non-technical partners for pennies on the dollar, there may well be significant repercussions. And, as someone here mentioned, it's also just kind of shitty.
Food for thought.
For those mentioning taxes -- unless he's selling his BTC, he likely doesn't have a requirement to mark his BTC to market; this is no doubt a gray area in the tax law right now. I wouldn't say he owes right now unless he's liquidating.
Good news for me anyway , they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.
I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
, they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
Michael Brown (knightmb), you have not told the full story here, and this is not the first time you have screwed an employer. If you do not do the right thing now, this will come back to haunt you.
You are also in over your head. Has it occurred to you that you owe $850,000 of federal income tax on this "deal"? Fortunately for you, we do not have state tax in Tennessee, but you will still owe business taxes, and you haven't even applied for the right licenses.
You have one chance to do the right thing here. You know what it is.
Beacon, is a newbie with one post. Could be fake. Beacon, do you know the full story? Sounds like knightmb just pulled off a Louisiana Purchase. The U.S. did it to France and I don't see what knightmb did wrong...unless there is more to the story...
For your own sake knightmb, I hope you spent roughly triple that on iron-tight mutual indemnifications. If not, here is my advice (I'm not a lawyer, btw):
1. Get a lawyer, right now
2. On review, figure out if you need to get a settlement in place which covers all mutual indemnifications.
3. Get those things locked down. You will likely have to pay some of your $3m USD in earnings to get that sorted.
When you have a technical partner knowingly buying assets from non-technical partners for pennies on the dollar, there may well be significant repercussions. And, as someone here mentioned, it's also just kind of shitty.
Food for thought.
For those mentioning taxes -- unless he's selling his BTC, he likely doesn't have a requirement to mark his BTC to market; this is no doubt a gray area in the tax law right now. I wouldn't say he owes right now unless he's liquidating.
1. Get a lawyer, right now
2. On review, figure out if you need to get a settlement in place which covers all mutual indemnifications.
3. Get those things locked down. You will likely have to pay some of your $3m USD in earnings to get that sorted.
When you have a technical partner knowingly buying assets from non-technical partners for pennies on the dollar, there may well be significant repercussions. And, as someone here mentioned, it's also just kind of shitty.
Food for thought.
For those mentioning taxes -- unless he's selling his BTC, he likely doesn't have a requirement to mark his BTC to market; this is no doubt a gray area in the tax law right now. I wouldn't say he owes right now unless he's liquidating.
Thank goodness!
knightmb is in the perfect position to start selling Bitcoins in a physical store. Even at high markups, cash to BTC on Android or to a specific address has the potential to sell like gangbusters.
The high markups would be necessary to ensure profitability while finding someone else who'll take USD for BTC.
knightmb is in the perfect position to start selling Bitcoins in a physical store. Even at high markups, cash to BTC on Android or to a specific address has the potential to sell like gangbusters.
The high markups would be necessary to ensure profitability while finding someone else who'll take USD for BTC.
Good news for me anyway , they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.
I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
, they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
Michael Brown (knightmb), you have not told the full story here, and this is not the first time you have screwed an employer. If you do not do the right thing now, this will come back to haunt you.
You are also in over your head. Has it occurred to you that you owe $850,000 of federal income tax on this "deal"? Fortunately for you, we do not have state tax in Tennessee, but you will still owe business taxes, and you haven't even applied for the right licenses.
You have one chance to do the right thing here. You know what it is.
State laws might be a bit more complicated, but aside from sales tax (which only applies to end consumers anyway, not sales of business transactions), I can't think of any reason a state would tax this particular situation.
I agree that knightmb didn't really take the moral high ground on this, but that's his decision to make, not mine.
Good news for me anyway , they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.
I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
, they sold me the project for $5k to recover some of their cost. I now technically own the wallet files and other software I was working on with them at the time. For legal reasons I can't blurt out who the investors were or the banks, companies, etc. they were representing basically (unless I won't to land in court forever), but I think I made a wise investment. It's still going to take a while to get my wife on board as she still doesn't understand the whole BTC concept, but everyone here knows and I know what it means. She was really skeptical about my purchase this week.I'll probably take some of the backup advise here too, why have a few backup copies when you can have many on different media types spread around everywhere (all encrypted of course this time).
Thanks for the advise everyone!
Michael Brown (knightmb), you have not told the full story here, and this is not the first time you have screwed an employer. If you do not do the right thing now, this will come back to haunt you.
You are also in over your head. Has it occurred to you that you owe $850,000 of federal income tax on this "deal"? Fortunately for you, we do not have state tax in Tennessee, but you will still owe business taxes, and you haven't even applied for the right licenses.
You have one chance to do the right thing here. You know what it is.
If this download saved you time, consider sending a donation of any amount to 1JpLBb3S9PEdft2SsB3ZT6YnwwNWqupYTJ
Considering the fact that you are likely to own more BTC than all the other forum users combined I think it's time to update the signature
Quote from: knightmb link=topic=6825.msg123739#msg123739
I think after a few more stories make it in the news about the BTC value, they will kick themselves for sure.
[/quote
I think after a few more stories make it in the news about the BTC value, they will kick themselves for sure.
[/quote
They're going to do more than kick themselves. If their is a kink in any of your contractual armor expect to be sued.
Yea, almost 0% chance they don't sue when Bitcoin pops up in the Economist. Hopefully you received decent advice from a lawyer when setting up the contract.
Quote from: knightmb link=topic=6825.msg123739#msg123739
I think after a few more stories make it in the news about the BTC value, they will kick themselves for sure.
[/quote
I think after a few more stories make it in the news about the BTC value, they will kick themselves for sure.
[/quote
They're going to do more than kick themselves. If their is a kink in any of your contractual armor expect to be sued.
Far out. So let me get this straight. You have just secured the ownership of the keys to 371k btc for USD$5k because the initial investors wanted out and can't be bothered to check current trading value of BTC .... and your wife is skeptical!?
That's epic.
As I said earlier, if you need to move large amounts contact me ... or have your wife contact me if she is still skeptical.
The initial investors never got the concept really. When I first started, when 1 BTC was basically $0.0001, the idea was to generate/buy as many as possible, then use it for payments. So if someone wanted a credit card that could buy $100 worth of stuff, they would insert X number of bitcoins to get that value loaded on the card. To keep the bank current, the credit card would be backed by Bitcoins at the bank basically. They initially though that 1 BTC would never get above maybe $0.20 per BTC, at least that's what I go from them. So they invested about $12k to either generated or buy bitcoins for the first part of 2010.That's epic.
As I said earlier, if you need to move large amounts contact me ... or have your wife contact me if she is still skeptical.
My part was to simply compile some versions of bitcoin that could run on the Amazon cloud service. They rented a ton of CPU time and basically generated BTC non-stop for a while. At the same time, I was buying from members here (they probably remember me buying a ton from them) and then funnel everything into one massive wallet file. After funds ran out, so did the Amazon CPU time and me bugging members to buy what they had generated from the start.
Then things sat in limbo for a while, long while. The project went bust and the people I was working with really still had no idea how BTC worked really. Soon, the project turned into zombie status and the initial investors (remember these aren't technical people in the least) though it was worthless or maybe just a fade that was dieing a quick death. Who am I to argue? That's when I offered a buy out back in Feb of this year and they took it finally.
I think after a few more stories make it in the news about the BTC value, they will kick themselves for sure.
Either way, I'm keeping my BTC in several secure places and the wallet files I'll make sure never touch my PC for security reasons. I look at it as a retirement fund, when I finally get tired of working the 9 to 5 grind, I can tell my boss to shove it with a smile
Better yet, engrave the key to a high value address/wallet in a good sized gold ingot and bury the whole damn thing somewhere.
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