Topic: Bitcoin Is Property Not Currency - page 5. (Read 14732 times)

Buy a bitcoin for $100 - no tax implications for the buyer. There is no law on what you can buy something for. It's the seller who might have gains/losses that are taxable.

You trade your bitcoin with another person's bitcoin - no tax implications. Nobody gained or lost anything, just a trade on EQUAL VALUE assets. Both coins are worth whatever btc was trading that day. Nobody won or lost. Your newly traded btc still has a value of $100. The $1000 price tag stays with the original owner, not you.

You buy something for $550 - you realized a $450 gain ($550 - $100). You owe taxes on that $450 gain.

It's a bit vague at the moment..

Might need someone who is actually familiar with bitcoin to help the IRS out.

The IRS has dealt with issues like these for decades. This is nothing new, and doesn't require any new laws. I work with taxes and deal with these issues all the time.

You can calculate your earnings however you want, and whatever exchange you want, as long as the IRS deems it was a 'reasonable' choice. If most exchanges are buying coins for $550, and there is one that is buying them at $122, and you 'chose' the $122 to sell at, this will seem suspicious. The IRS will then modify your numbers to the $550 range and you will owe taxes and penalties based on the difference.

People have intentionally set up fake exchanges for other goods in the past (like to appraise jewelry incorrectly) to get by the IRS, and when the IRS finds out about it, usually those people serve jail time.

It doesn't matter WHERE you earned the btc - if you are US citizen, it's taxed.

It's not that hard to understand. And you can't 'trick' the IRS or use some funny way of calculating anything. The IRS is smart and has been battling these issues for decades. You can't fight them. If they say you did it wrong, you did it wrong and must pay the fines and penalties or you will go to jail. It's not like a court.

The IRS can't track every little thing you do with btc, but if you are audited, the IRS will look into your history and purchases, talk to your friends and associates, and look at anything suspicious. If you bought a new car, but didn't have any money to do so, this will look suspicious and they will claim you used btc to do it. The IRS will charge you the taxes and penalties on it and also may charge you with tax fraud along with a jail sentence. The IRS does not need proof - YOU need to prove how you bought the car.

I don't think you understand how the IRS works.

All the IRS cares about is the final dollar amount. If you tell the IRS that you owe $0, and then attach thousands of pages of documentation (which you'll be paying to send to them), they'll just throw that in a binder and file it away and never look at it. YOU will be doing all the work for nothing.

If you mined a coin at $1200 then you technically received property worth $1200 that is now worth $600.

When can you realize the loss?

This is hurting my head.

If your in a foreign country and using a US pool, are you liable for earning on property in the US?

Surely this is virtual property and a virtual problem.

If you use a off shore pool and exchange, then your property is outside US until you exchange that foreign currency for US dollars is it not ?

OK, you have overseas property gains by US terminology but in that country it may be a virtual property.

really? Holding longer means a higher tax rate? Normally it is the other way around. In Germany Bitcoin is a currency and you pay 25% as a capital gain in the first year and after one year you pay nothing (like with every currency. Under one year is considered as speculation, trading).
Now on assets we pay 25% flat on every gain, no matter how long you hold it. This is new since 2008. Before that it was 30% tax within the first year and nothing with more than one year - if you are a individual private saver.

This regulation is no big deal. Question: Is there anything else considered as currency in the US, except of national currencies?



I think you have a first in first out. If you sell one btc or buy something with it, there will be no tax at the price of 100$.

No. It's an accounting problem.

If you bought 1 BTC at $10 and another at $100 and the bitcoin price is $100 when you buy a $200 shirt with 2 BTC then you have a capital gain of $90 which is now realized. If that $10 BTC was kept for less than a year before the shirt was bought the $90 profit would be taxed at an income tax rate, perhaps 40%, otherwise it would be more like 20%.

Reminds me of this:
 

Won't this affect Bitcoin's fungibility ?

One Bitcoin won't be the same as another Bitcoin.. since there will be tax to pay on the capital gain.

If you bought a BTC at $10 and another at $100, and now you wanted to spend one to buy a $100 shirt, when the price is 100$/btc.

The 2 bitcoins have different value now.. 

Is that what they are saying ?

  Can you guys base those earnings on MtGox rates, $122 wasn't it when last traded.

Or do you have to base it on the price of an US Exchange 

Now what if there was only one US Exchange and it was like a fraction of the real price (no buy orders obviously).

Are those coins Earned oversea's ? or in the clouds ?

So much to go wrong here..

It's obedient cunts like yourself why the world economy is up shit creek.

"Great for bitcoin", "I like paying taxes". Amazing what you read, slaves will be slaves.

Let's go chimps, evolve already. I wanna see liberty in my lifetime.

So who is going to have fun with the IRS by sending one satoshi back and forth between wallets millions of times and then reporting all those transactions on their taxes?

Well the thread was about bitcoin capital gains.  Foreign Earned Income "can" be excluded from US taxes but the key word is earned income (i.e. salary or wages).   Sadly capital gains, interest, dividends, royalties, etc do not fall under FEIE.  It is also possible the US has a tax treaty with another nation where foreign paid taxes reduce (possibly to $0) the US taxes owed.  Of course this doesn't save the US taxpayer any money (if you owe $10,000 in US capital gains the only way you pay Uncle Sam $0 is if you paid >=$10,000 taxes to another nation) but it doesn't prevent double taxation (paying $10,000 to France and then having to pay $10,000 to US for the same capital gain).

Have you considered going to get some fresh air rather than abusing everyone in sight?

It would suit The Man very nicely to steer it into being a commodity rather than currency. Lots of money to be made, little threat to the dollar as a day to day medium of exchange.

 Are you people retarted? "I won't pay my taxes" Har har har... Good luck with that you stupid cunts.

Actually i was told that i can still keep my citizenship and only pay tax to the primary country if i only stay in US for less than xx days.

Many dual citizens do this.

no matter how you will call it, bitcoin is power
its like chaos theory, you can't predict it if this news matter or not and to how many people.

the IRS is already guilty as sin for selectively targetting Tea Party groups and other Libertarian-minded organisations in politically motivated ferocious, terrifying audits that drag on for months and sometimes years ... what's changed again?

Once the war starts it may behoove you to recall who fired the first shots?

Edit: celebrating and cheering on of State sanctioned violence, intimidation and threats of violence for what are essentially acts of civil disobedience is disgusting and downright ghoulish, on a moral par with the Nazis cheering the persecution of Jews.

Interestingly the markets still don't seem to care...

Excellent summary of evasion vs. avoidance.