Bitcoin Is Property Not Currency - page 7.

gollum

sr. member

Activity: 434

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In Hashrate We Trust!

Quote from: Polycoin on March 26, 2014, 11:00:28 AM

Quote from: gollum on March 26, 2014, 10:58:45 AM

Thank you IRS!

That was the nail in the coffin for speculation in bitcoin.
Instead we can use colored bitcoins to issue USDollar IOUs, which implies a fixed price between the colored coin and USD, therefore no profit will be possible.
And no volatility will occur when the coin is pegged to US dollar.

the U.S dollar is doomed to fail, having lost 97% of it's original value since 1913...No one should want to be pegged to the U.S Dollar.

Only a fool would keep money for 100 years, instead you use money to consume, or to invest in real estate, stocks and bonds.

Polycoin

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Activity: 294

Merit: 250

Quote from: gollum on March 26, 2014, 10:58:45 AM

Thank you IRS!

That was the nail in the coffin for speculation in bitcoin.
Instead we can use colored bitcoins to issue USDollar IOUs, which implies a fixed price between the colored coin and USD, therefore no profit will be possible.
And no volatility will occur when the coin is pegged to US dollar.

the U.S dollar is doomed to fail, having lost 97% of it's original value since 1913...No one should want to be pegged to the U.S Dollar.

gollum

sr. member

Activity: 434

Merit: 250

In Hashrate We Trust!

Thank you IRS!

That was the nail in the coffin for speculation in bitcoin.
Instead we can use colored bitcoins to issue USDollar IOUs, which implies a fixed price between the colored coin and USD, therefore no profit will be possible.
And no volatility will occur when the coin is pegged to US dollar.

This is good for commerce and consumers, and bad for speculators and hoarders of bitcoin.

BadBear

legendary

Activity: 1652

Merit: 1128

Quote from: sykal on March 25, 2014, 11:30:31 PM

Quote from: amspir on March 25, 2014, 11:25:44 PM

Quote from: sykal on March 25, 2014, 11:13:44 PM

this is all great and fine with everyones examples of 1 BTC...but what about the other 99% of us who mine like .1/.2/.3 btc/day for example.

We're now supposed to keep track on every fraction of BTC we receive as well as the current price we receive that at? that's almost impossible.

Look at your receiving address(es) that you use for mining on blockchain.info. It will show all of the time and amounts of received btc. I'm pretty sure that the blockchain.info api has a function to show what it was worth at the time of the transaction, since my android blockchain wallet will tell me the "now" and "then" values in USD on each transaction.

Not impossible if you have a computer connected to the internet and your receiving address(es).

So what happens when you sell? You have accumulated coins over the months, but how do you know which particular coins you are selling? Maybe you're selling 5% of the coins you mined at $600, 2% of the coins mined at $630, 6% of the coins you mined at $510

Do you see where I'm going with this?

I have an accountant who used to work for the IRS doing my taxes, and she said to use a FIFO type system. First in, first out. It's not as complicated as some of you are making it out to be.

That was before this ruling though, we haven't talked in depth about the tax situation since this, though she did give me a heads up on the IRS statement.

bitcoiner49er

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Activity: 457

Merit: 250

When does this take effect? What about those who already filed taxes?

dogechode

full member

Activity: 182

Merit: 100

Here is what I don't get. Someone said if you mine then you pay taxes based on the value of the coins at the time you mined them. That seems borderline impossible to calculate since there is no central body in charge of prices and they change rapidly. You could be mining doge and it could be worth 120 sat on mintpal and 115 sat on cryptsy at the same moment. Also, the value changes constantly even throughout one single day. Are you supposed to valuate each payment from the pool individually?

And, are they saying that if you mined and held the coins and they dropped in value you would owe taxes based on what they were worth when you mined them? So for example if you were mining doge when it was worth 300 sat, and you have held them, and end up selling them when they are worth 125 sat, then you owe taxes based on the 300 sat figure? That seems absurd...

rohnearner

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Activity: 350

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REAL-EYES || REAL-IZE || REAL-LIES||

Quote from: BitOnyx on March 26, 2014, 09:33:58 AM

I hope you guys know it is only in USA

That is the reason about all the hype around it too..! USA is I guess one of the largest bitcoin market after China[correct me if i'm wrong] and there is a huge impact of authorities stand on crypto no matter how much we deny that in this community.!

Joshuar

hero member

Activity: 504

Merit: 500

eidoo wallet

Quote from: nitehawk on March 26, 2014, 05:09:16 AM

so i'm curious if bitcoins a property.. why is the owner of silkroad being charged for transmitting money without a license??

He's being charged with fraud, and distrubtion of drugs etc.

The fraud charge makes no sense, this Bitcoin isn't really regulated... , but the distrubtion of drugs makes sense since he owned a Drug market lol.

BitOnyx

member

Activity: 112

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Cryptocurrencies Exchange

I hope you guys know it is only in USA

Searing

copper member

Activity: 2898

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Clueless!

Quote from: h3m96 on March 26, 2014, 04:58:08 AM

I agree with Dissonance and Holliday.... I saw the NYT article last night and have been reading posts here. It is shocking what some people have said haha. But yeah I have no problem paying taxes on money I earn mining. I can easily export my wallet right there from inside the wallet into a CSV file so I don't see the problem with tracking dates. And I think it's also good for Bitcoin. I have been worried my credit union will eventually say, what are all these deposits? We've all been wondering that I'm sure and I am glad it's going to be implemented into the ecosystem and I can mine for a living now and relax

by tracking dates i assume you mean when I shoot my "pool wallet" to my blockchain address? then i'm 'paid' and use those dates?

it would be impossible to keep track of how much .00859000 btc or whatever day by day in the pool wallet imho

so if in a 3 month period..i have 15 payments to my block chain...dated and timed ....from that you can figure your tax rate

and just to end this (mr. obvious) you don't have to pay any taxes (capital gains) if you don't sell the coins?

trying to get a handle on this i'm a bit dense

Searing

whtchocla7e

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Worlds Simplest Cryptocurrency Wallet

Quote from: nitehawk on March 26, 2014, 05:09:16 AM

so i'm curious if bitcoins a property.. why is the owner of silkroad being charged for transmitting money without a license??

law doesn't work backwards.

bbeagle

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Activity: 63

Merit: 10

Quote from: sykal on March 25, 2014, 11:30:31 PM

So what happens when you sell? You have accumulated coins over the months, but how do you know which particular coins you are selling? Maybe you're selling 5% of the coins you mined at $600, 2% of the coins mined at $630, 6% of the coins you mined at $510

Do you see where I'm going with this?

Even though YOU might keep the coins you mined in different wallets, the IRS doesn't know any difference - or care. YOU are paying taxes, and they're all YOURS.

Example:
Mint 1 btc on April 1 - going rate $600 = $600
Mint 5 btc on May 1 - going rate $700 = $3500
Mint 5 btc on June 1 - going rate $500 = $2500

On August 1 you sell 20% of each.... the IRS doesn't care which 'wallet' they came from - they're ALL yours.
The IRS simply takes the August 1 selling rate, say $1000, and .2 + 1 + 1 = 2.2 x 1000 = $2,200 cashed in value.

The IRS uses a first-in-first-out to determine the profit you made. The IRS calculates that out of 2.2, the 1 came from April 1 btc, and 1.2 came from May 1 btc. Therefore the cashed in value of $2200 is subtracted from $600 and $700 x 1.2 = $840. $600 + $840 = $1440.

$2200 - $1440 = 760 - your profit.

Despite you keeping your coins in different wallets, you still have 11 - 2.2 = 8.8 btc left. That's all the IRS cares about.

Earnings = 600 + 3500 + 2500 = 6600
Profit = 760
Total Taxable = $7360

Accountants have been doing this for years. It's no different with bitcoins.

nitehawk

hero member

Activity: 532

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Worldcore - Banking for the Future

but then they would be the ones committing the crime.. . how am i going to be charged for someone else sending me money.. i cant control what other people do with there cash

amspir

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Activity: 112

Merit: 10

Quote from: nitehawk on March 26, 2014, 05:09:16 AM

so i'm curious if bitcoins a property.. why is the owner of silkroad being charged for transmitting money without a license??

My guess is that it has to do with vendors on silkroad that would mail you cash for bitcoin.

nitehawk

hero member

Activity: 532

Merit: 500

Worldcore - Banking for the Future

so i'm curious if bitcoins a property.. why is the owner of silkroad being charged for transmitting money without a license??

h3m96

member

Activity: 60

Merit: 10

I agree with Dissonance and Holliday.... I saw the NYT article last night and have been reading posts here. It is shocking what some people have said haha. But yeah I have no problem paying taxes on money I earn mining. I can easily export my wallet right there from inside the wallet into a CSV file so I don't see the problem with tracking dates. And I think it's also good for Bitcoin. I have been worried my credit union will eventually say, what are all these deposits? We've all been wondering that I'm sure and I am glad it's going to be implemented into the ecosystem and I can mine for a living now and relax

seriouscoin

hero member

Activity: 658

Merit: 500

Quote from: smooth on March 26, 2014, 03:15:32 AM

Quote from: seriouscoin on March 26, 2014, 03:11:47 AM

Quote from: ?? on ??

Quote from: seriouscoin on March 26, 2014, 03:04:31 AM

Quote from: DeathAndTaxes on March 26, 2014, 02:38:48 AM

Quote from: iambk on March 26, 2014, 12:45:21 AM

With BTC there isn't a broker so I assume you simply need to document your decision but I'm not a tax lawyer so I'm not really sure.

The blockchain is the most perfect broker record you could hope for.

With coin control you could sell exactly the coins you wanted to at exact the basis you wanted to at any time.

How? as far as i know you can choose wallet to spend but btc are stored in transactions.

I can have bunch of tx in that wallet, but i cant pick the a specific one, correct?

You can if your wallet software supports coin control.

Is it the same coin control from Armory? Because it only let me choose which address to spend from. Not tx....

Please share if i miss something

Sounds perfect as long as you don't reuse addresses.

No sounds terrible if you understand bitcoins are just tx outputs. Address was used to make it easy for traditional money management.

smooth

legendary

Activity: 2968

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Quote from: seriouscoin on March 26, 2014, 03:11:47 AM

Quote from: ?? on ??

Quote from: seriouscoin on March 26, 2014, 03:04:31 AM

Quote from: DeathAndTaxes on March 26, 2014, 02:38:48 AM

Quote from: iambk on March 26, 2014, 12:45:21 AM

With BTC there isn't a broker so I assume you simply need to document your decision but I'm not a tax lawyer so I'm not really sure.

The blockchain is the most perfect broker record you could hope for.

With coin control you could sell exactly the coins you wanted to at exact the basis you wanted to at any time.

How? as far as i know you can choose wallet to spend but btc are stored in transactions.

I can have bunch of tx in that wallet, but i cant pick the a specific one, correct?

You can if your wallet software supports coin control.

Is it the same coin control from Armory? Because it only let me choose which address to spend from. Not tx....

Please share if i miss something

Sounds perfect as long as you don't reuse addresses.

seriouscoin

hero member

Activity: 658

Merit: 500

Quote from: ?? on ??

Quote from: seriouscoin on March 26, 2014, 03:11:47 AM

Quote from: ?? on ??

Quote from: seriouscoin on March 26, 2014, 03:04:31 AM

Quote from: DeathAndTaxes on March 26, 2014, 02:38:48 AM

Quote from: iambk on March 26, 2014, 12:45:21 AM

With BTC there isn't a broker so I assume you simply need to document your decision but I'm not a tax lawyer so I'm not really sure.

The blockchain is the most perfect broker record you could hope for.

With coin control you could sell exactly the coins you wanted to at exact the basis you wanted to at any time.

How? as far as i know you can choose wallet to spend but btc are stored in transactions.

I can have bunch of tx in that wallet, but i cant pick the a specific one, correct?

You can if your wallet software supports coin control.

Is it the same coin control from Armory? Because it only let me choose which address to spend from. Not tx....

Please share if i miss something

I don't know, I haven't used it. Of course, there is always Armory!

So you're telling me the new coin control feature from Bitcoin Core let you choose specific tx output to spend?

Armory coin control only let you pick address, which contains bunch of tx.

seriouscoin

hero member

Activity: 658

Merit: 500

Quote from: ?? on ??

Quote from: seriouscoin on March 26, 2014, 03:04:31 AM

Quote from: DeathAndTaxes on March 26, 2014, 02:38:48 AM

Quote from: iambk on March 26, 2014, 12:45:21 AM

With BTC there isn't a broker so I assume you simply need to document your decision but I'm not a tax lawyer so I'm not really sure.

The blockchain is the most perfect broker record you could hope for.

With coin control you could sell exactly the coins you wanted to at exact the basis you wanted to at any time.

How? as far as i know you can choose wallet to spend but btc are stored in transactions.

I can have bunch of tx in that wallet, but i cant pick the a specific one, correct?

You can if your wallet software supports coin control.

Is it the same coin control from Armory? Because it only let me choose which address to spend from. Not tx....

Please share if i miss something

Topic: Bitcoin Is Property Not Currency - page 7. (Read 14732 times)