Topic: Coinbase Bitcoin Users Who Evade Taxes Are Sought by the I.R.S. (Read 2035 times)

If the investigation is actually successful and people convicted because of this, then all I can say is that one of the fundamental basis of Bitcoin which is "anonymous transaction" is being defeated and I see quite a number of people moving to more "anonymous currency" to carry out their transactions. Aside that, this is a further proof to my theory in another thread that government will continue to have its way when it comes to income tax purposes. If we cannot tax you then we shutdown everything all together.

Hearing this makes me want to close my account with them right now.
It is not worth the hassle to keep an account with them and not knowing if they are up to something with your personal info.
That is a not needed extra stress on anyone's life.

That why some government that is aware on bitcoin existence im sure that they are already preparing up if the situation or adoption of bitcoin will arise on their nation.Yes, government will not surely sleep on that and they will find ways to impose taxes no matter what. Lossing revenue because of bitcoin is really a serious matter and i could say that if bitcoin adoption cant be stopped then this problem will surely arise.

http://www.foxnews.com/politics/2016/12/15/bitcoin-user-battles-irs-in-court-over-access-to-private-data.html

 Pretty bad news for the IRS when the legal heavyweights start weighing in AGAINST their abuse of process.

 Sad part is that the original judge didn't bother looking at the request and realise it was a blatant violation of 4'th Amendment rights and of due process.

This is getting serious as the regulations are coming gradually and this is what I have always say in my posts relating to legality of Bitcoin. I see US enacting a law very soon regulating this crypto-world in another dimension and other countries following suit. This among other reasons why exchange sites will even ask for blood group in other to trade. This is a drawback, in as much as we are celebrating the popularity of Bitcoin, we should also not be unmindful of the fact that as more people are coming in, more revenue loss to government and government will not sleep on that...

The buy/sell does not cancel your liability. You bought 1.5 bitcoins for $750 and sold them for $1000. So you will have to pay tax on the profit of $250.
The other 0.5 bitcoin that you have bought for $250, you will need to pay taxes only when you sell it (for a profit).

I saw this coming some time ago.  I decided to use localbitcoins (or private escrow members) and cash, which is legal, just to avoid "name capturing" by the Gov.  These big exchanges are totally legal, as I am, but I don't like names being sifted into a capture net.  LBC has my internet monikers only, and anyone can have them (its not Coin-Keeper obviously).  Also, my observation is that Coinbase is way too slow for me.  Not a reputation thing against them.  I just prefer to deal with instant or close to it.

Is there also a certain value that the gains must be above in order to require reporting taxes on them? If you had a gain of $5 are you still required to report it?

I'm assuming the IRS would likely only be hunting the big fish rather than smaller users. I was also curious if you bought 2 bitcoin for $1000 total and sold 1.5 bitcoin for $1000 . If you never sell the extra 0.5 that you have left, do you have to report taxes/ownership of it or does the buy/sell cancel each other out and limit your taxability?

I'm sure that makes Coinbase and all of it's users feel much better.

Thank you for sharing.

So did King George.  Until the Yankees became sufficiently infuriated by his ruinous taxation, writs of assistance, and general warrants.

So did Hillary.  Until the FBI let it be known she would have been frogmarched if her husband wasn't a former President, and Trump ended her career.

(Wednesday 11/30)
...In a two-page court order, US Magistrate Judge Jacqueline Scott Corley agreed that the IRS can serve the San Francisco-based company with a form that would require disclosure of essentially all personal data of all Coinbase users who conducted a transaction between 2013 and 2015. ...

I'm not sure why Coinbase thought they would be able to fight this.  This agency has a well documented history of essentially doing anything they want without recourse.  Check your records folks...you might be getting a letter from our friends.

Taxes, among other intolerable acts, are the reason there is a United States, rather than just a bunch of English colonies.

The proper response to taxation without representation is tar and feathers.

'member this?



We fought a revolutionary war over issues like general warrants and writs of assistance, which is what the IRS is issuing to Coinbase for its due process violating fishing expedition.

We killed or otherwise defeated our oppressors until they left us alone to be "a shining city on a hill."

Back then we had muskets and cannons.

Today we have sniper rifles, pistols, plastique, drones, chemical weapons, and undetectable poisons.  All available over the internet.

Back then, the tyrants' property and families were safe back in merry old England....

They want the information on everyone and anybody who ever transacted or purchased with bitcoin including your account information.

If you bought bitcoin, held it, sold it, sent it to a different wallet, what your email, phone, etc. all of that they want it.

Coinbase is fighting it but we know how this story ends.

The law will side with the IRS.

In the end, no one should be surprised. A U.S based company that asks for identifying documents -- we all knew that the moment any exchange asked for ID documents there was a possibility they would be reported to the IRS. That's why some people choose localbitcoins or avoid exchanges that require ID altogether.

We also knew that any company based in the U.S. is subject to the jurisdiction of the united states which isn't necessarily known for it's freedom. Very focused on surveillance,  etc.

note even as they outlaw oppressive laws in one hand; they pass new ones with 'subtle' names with the other. Ex. the new law that allows the Feds to remote control any one's computer device if they are using any kind of vpn or proxy.

I would be surprised if there is anyone actually surprised that this is happening. I personally had thought this had happened sooner.

I think it's definitely time to look at decentralized exchanges that don't request identity if there are people who haven't already.

Only if you sell and only if you had gains.  If you bought high and sold low then that would be a loss instead which is not taxable.

Only if you sell and are audited.

Oh, so do you mean people who trade and then finally retain their earnings in bitcoin ?


Yes, that part I understand, but when you sell it the money will enter your bank account and you will anyways have some explaining to do then.

There's no need to buy. You can receive bitcoins via Coinbase. Selling them would then be a taxable event, assuming you're not just sending bitcoins to yourself (but you might have a hard time explaining that to the IRS).

If you both bought and sold bitcoins through Coinbase and had realized gains (sold bitcoins for more than they cost), then the IRS would be able to identify that fairly easily. If taxes were not paid on those gains, they would would be able to go after you for the taxes due on those gains.

Since people using Coinbase would be buying bitcoins using their bank accounts, so how exactly would people be evading taxes here ? Wouldn't all that money earned that they didn't pay taxes on would have hit their bank accounts first ?