Can someone please give me an exact answer on alt coin taxes in this case?

chaosfourever

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Quote from: bouren on July 07, 2017, 10:31:12 AM

Quote from: chaosfourever on July 07, 2017, 08:20:26 AM

I will use a very specific answer. Lets say I bought NXT when it was very low. It has now gone up. So on the NXT exchange through the client I exchange the NXT for Ardor. Do I need to pay taxes on this exchange? Or do I pay the taxes when I actually turn the Ardor into USD? I am in the US. If I would need to pay taxes now then how would I even go about something like that since even tax guys don't understand this?

This is pretty obvious concern because accounts professionals don't know about Cryptocurrencies and crypto professionals don't know about accounting stuff, so both lack answers.
Well in your case. You can freely exchange cryptocurrencies (NXT to ARDR here) without any worry of taxes. Government can't in the hell spy your exchange account no matter how much profit you made. But yes when you exchange ARDR to USD and withdraw it to bank, tax authority may throw torch light on your face and inquire about sudden surge in balance. Best is to show your cryptocurrency income as profitable income from stock/shares in your tax return and pay considerable tax then to worry later.

Thank you. I have records of the trades, but it would be pretty ridiculous if they taxed you on every exchange. Especially since exchanging is the only way to get alt coins. I can see taxing bitcoin simply but alts are a whole different story. Makes since to tax when I gain actual money, but in the meantime it is just all in coin form still.

bouren

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Quote from: pereira4 on July 07, 2017, 10:36:05 AM

Quote from: bouren on July 07, 2017, 10:31:12 AM

Quote from: chaosfourever on July 07, 2017, 08:20:26 AM

Well, governments can ask exchanges about their records, and if you use your real data, they can find out about your trades. For example, to register in bittrex, you need to give your real name, place of birth etc, and they check against public records, so you cant enter fake names.

Really because I am daily Bittrex user but site never asked me any kind of verification. I invest bitcoins, buy other coins, earn profits, change coins to bitcoins and withdraw bitcoins.
Also how can government ask me details of something which is really unregulated.
No country can ask you taxes on something which it doesn't own or which is not natural until it regulates that thing. Similarly when you make profit with cryptocurrency then you just need to declare it as your investment profit and pay adequate tax, that's it.

spartak_t

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@FAILCommunity

No one can tax you for this. Back in 2014 (I think?) in Bulgaria they tried to put a 10% corporate tax on profits from Bitcoin, but there's no way for them to prove anything. I will give scams as an example. A good amount of money (100s of thousands $) should be involved in a scam in order some agency (say IRS) to start investigating it. Can you guys imagine how much money and resources (not to mention trained personnel) it would take them to investigate ALL the people trading with Bitcoin (or whatever) and ALL of their trades? The best thing the governments can do is to declare some tax on Bitcoin profits and to research on random basis. Keep low profile (don't rob a bank!) and you'll be fine.

pereira4

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Quote from: bouren on July 07, 2017, 10:31:12 AM

Quote from: chaosfourever on July 07, 2017, 08:20:26 AM

I will use a very specific answer. Lets say I bought NXT when it was very low. It has now gone up. So on the NXT exchange through the client I exchange the NXT for Ardor. Do I need to pay taxes on this exchange? Or do I pay the taxes when I actually turn the Ardor into USD? I am in the US. If I would need to pay taxes now then how would I even go about something like that since even tax guys don't understand this?

This is pretty obvious concern because accounts professionals don't know about Cryptocurrencies and crypto professionals don't know about accounting stuff, so both lack answers.
Well in your case. You can freely exchange cryptocurrencies (NXT to ARDR here) without any worry of taxes. Government can't in the hell spy your exchange account no matter how much profit you made. But yes when you exchange ARDR to USD and withdraw it to bank, tax authority may throw torch light on your face and inquire about sudden surge in balance. Best is to show your cryptocurrency income as profitable income from stock/shares in your tax return and pay considerable tax then to worry later.

Well, governments can ask exchanges about their records, and if you use your real data, they can find out about your trades. For example, to register in bittrex, you need to give your real name, place of birth etc, and they check against public records, so you cant enter fake names.

In any case, always pay your taxes, and try to keep track of your trades, even if you shoud only pay capital gain increase tax once you sell for USD, but what if they ask where the money came from? you are going to be able to give an explaination.. so save your trades.

I lost my trades in Mintpal because the exchange is dead and now I dont have these trades so im a bit worried about that in case they ask.. but how would they even check? they trace the bitcoin addresses? how thy know if it belongs to an exchange or not?

Honestly this is so new that it becomes so confusing.

bouren

sr. member

Activity: 392

Merit: 250

Quote from: chaosfourever on July 07, 2017, 08:20:26 AM

I will use a very specific answer. Lets say I bought NXT when it was very low. It has now gone up. So on the NXT exchange through the client I exchange the NXT for Ardor. Do I need to pay taxes on this exchange? Or do I pay the taxes when I actually turn the Ardor into USD? I am in the US. If I would need to pay taxes now then how would I even go about something like that since even tax guys don't understand this?

This is pretty obvious concern because accounts professionals don't know about Cryptocurrencies and crypto professionals don't know about accounting stuff, so both lack answers.
Well in your case. You can freely exchange cryptocurrencies (NXT to ARDR here) without any worry of taxes. Government can't in the hell spy your exchange account no matter how much profit you made. But yes when you exchange ARDR to USD and withdraw it to bank, tax authority may throw torch light on your face and inquire about sudden surge in balance. Best is to show your cryptocurrency income as profitable income from stock/shares in your tax return and pay considerable tax then to worry later.

Febo

legendary

Activity: 2730

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Quote from: chaosfourever on July 07, 2017, 08:20:26 AM

I will use a very specific answer. Lets say I bought NXT when it was very low. It has now gone up. So on the NXT exchange through the client I exchange the NXT for Ardor. Do I need to pay taxes on this exchange? Or do I pay the taxes when I actually turn the Ardor into USD? I am in the US. If I would need to pay taxes now then how would I even go about something like that since even tax guys don't understand this?

You for sure dont need to pay taxes if you had not exchanged in UDS one some bank in USA.

I am not sure how is in USA, but in some countries you need to report all your crypto holdings. But that is sort of difference question since you only asked about tax.

chaosfourever

sr. member

Activity: 406

Merit: 250

I will use a very specific answer. Lets say I bought NXT when it was very low. It has now gone up. So on the NXT exchange through the client I exchange the NXT for Ardor. Do I need to pay taxes on this exchange? Or do I pay the taxes when I actually turn the Ardor into USD? I am in the US. If I would need to pay taxes now then how would I even go about something like that since even tax guys don't understand this?

Topic: Can someone please give me an exact answer on alt coin taxes in this case? (Read 293 times)