Topic: How do I pay taxes? - page 2. (Read 2089 times)
If you're using it as a investment, then I would take a look at how Forex Trading is taxed, I would base your taxes on that.
So if I hold Bitcoin in my wallet for more than a year I have to pay taxes on that? are you sure?
You don't owe taxes for just owning Bitcoins. You will owe taxes on any gains when they are realized (sold, spent or traded)
I mine altcoins and spend them in WAY less than a year by trading them into Bitcoins and using them on Gyft. So do I even need to report?
Mining could be immediate income or it could be manufacturing and therefore treated as stock. There is no IRS guidance yet, so it is up to you and your accountant to decide how to report it.
Gains made from coins are taxable, so trading one coin for another, or for a product or service, is a tax event and you would need to work out the gains made in USD and report it. Say you mined 5 LTC over the year, then converted to BTC to buy a $100 card. Your 5 LTC were realized for $20 each, so you would subtract the cost basis less any transaction fees to find their gains. Problem is because there is no IRS guidance you could also say you manufactured those 5 LTC and then spent them. In which case, you had income (not gains) of $100.
Stating the obvious, but this only applies to any sales (or purchases) you made in 2013 (for the US).
No one is sure. My CPA commented that even they are unclear how to deal with it.
Safest thing is pay capital gains tax just like any other income and if you overpaid, at
least you won't go to jail. ;-)
Safest thing is pay capital gains tax just like any other income and if you overpaid, at
least you won't go to jail. ;-)
Quite true think every needs to do this what about the people who forgot about Bitcoin and have only recently found it for example the guy who have like 6 millions worth in the news recently did he pay tax?
If his name was in the news, he'd better have. I hope he cashed out also. Six mill is plenty!
No one is sure. My CPA commented that even they are unclear how to deal with it.
Safest thing is pay capital gains tax just like any other income and if you overpaid, at
least you won't go to jail. ;-)
Safest thing is pay capital gains tax just like any other income and if you overpaid, at
least you won't go to jail. ;-)
Quite true think every needs to do this what about the people who forgot about Bitcoin and have only recently found it for example the guy who have like 6 millions worth in the news recently did he pay tax?
I am not a tax lawyer, but I have heard it this way. You need to pay capitol gains if you hold the coins for a year or more. If you spend them right after buying them it can be said you are using bitcoin as a payment network and not an investment. If spending/selling after a year try this formula.
First find the taxable amount:
Value of bitcoin at time of sale - amount paid for bitcoin = Taxable amount.
$660 - $12 = $648
Now depending on your tax bracket you may pay 0%-34%. Likely it will be 15% or 20%.
Taxable amount x percentage = Owed amount
$648 x .2=$129.6
So at 20% you owe $129.60 in this example.
First find the taxable amount:
Value of bitcoin at time of sale - amount paid for bitcoin = Taxable amount.
$660 - $12 = $648
Now depending on your tax bracket you may pay 0%-34%. Likely it will be 15% or 20%.
Taxable amount x percentage = Owed amount
$648 x .2=$129.6
So at 20% you owe $129.60 in this example.
I mine altcoins and spend them in WAY less than a year by trading them into Bitcoins and using them on Gyft. So do I even need to report?
No one is sure. My CPA commented that even they are unclear how to deal with it.
Safest thing is pay capital gains tax just like any other income and if you overpaid, at
least you won't go to jail. ;-)
Safest thing is pay capital gains tax just like any other income and if you overpaid, at
least you won't go to jail. ;-)
So if I hold Bitcoin in my wallet for more than a year I have to pay taxes on that? are you sure?
I mean like for Bitcoin
You don't pay taxes for Bitcoin you only pay taxes when transferring into usd.
I'm not so sure. I've read somewhere that mining them is taxable also because they have value. If you win a car
in a contest, you have no USD to show for it, but you still owe taxes. This is the downside of them being legally
considered to be money.
I mean like for Bitcoin
You don't pay taxes for Bitcoin you only pay taxes when transferring into usd.
I am not a tax lawyer, but I have heard it this way. You need to pay capitol gains if you hold the coins for a year or more. If you spend them right after buying them it can be said you are using bitcoin as a payment network and not an investment. If spending/selling after a year try this formula.
First find the taxable amount:
Value of bitcoin at time of sale - amount paid for bitcoin = Taxable amount.
$660 - $12 = $648
Now depending on your tax bracket you may pay 0%-34%. Likely it will be 15% or 20%.
Taxable amount x percentage = Owed amount
$648 x .2=$129.6
So at 20% you owe $129.60 in this example.
First find the taxable amount:
Value of bitcoin at time of sale - amount paid for bitcoin = Taxable amount.
$660 - $12 = $648
Now depending on your tax bracket you may pay 0%-34%. Likely it will be 15% or 20%.
Taxable amount x percentage = Owed amount
$648 x .2=$129.6
So at 20% you owe $129.60 in this example.
Your question is a little vague. Generally, you fill out a form called a tax return, on which you declare how much money you made during the previous financial year (including Bitcoin mining/trading). You send this form to your country's revenue service, then they calculate how much tax you owe on the monies you declared and send you a bill, which you pay like any other. Is there a specific part of this process that you're confused about?
I mean like for Bitcoin
what are you talking about
I mean like for Bitcoin
I've never done it before.
You find local consultant and ask or visit irs website there is alot of helpful docs there
Pay capital gains, that's it
I've never done it before.
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