Income Tax and Bitcoins | Bitcointalksearch.org

keithers

legendary

Activity: 1456

Merit: 1001

This is the land of wolves now & you're not a wolf

Quote from: olloman on January 22, 2014, 05:16:53 PM

Quote from: keithers on January 22, 2014, 05:15:21 PM

Quote from: olloman on January 22, 2014, 05:14:15 PM

I am no expert, but I guess it is up to you as long as bitcoins are not directly taxed. If you convert them to fiat or report them for their value I think they will probably be counted as possession and hence taxed and probably will prevent you from getting a disability wage, but eventually depends on where you live and the local laws. Instead if you wanted a discussion on a more ethical/philosophical level, it is still up to you...I personally think it would not be right getting a disability wage when you don't need it, just think as if you were "stealing" it from someone who does need it...but I am not here to give lectures, and if you are into Bitcoins for superficial reasons you might aswell be a hyper-libertarian egoist Wink

Hey I just saw your profile to the left of your post, and I have more activity and posts than you, but I am the newbie and you are not...lol

huh I don't know why xD probably they changed some forum settings after the last attack, but it's just my guess ^^

edit: or maybe I'm satoshi, who knows Cheesy

edit 2: actually I think it depends on the time you have spent logged on to the forum, not the posts

Yeah, weird...I don't care about the title, but it is preventing me from freely posting and replying which sucks Sad

Bit4Biz

newbie

Activity: 5

Merit: 0

Your first question "do I have to report bitcoins as income". The answer is: only if u have income. Buying and holding btc does not create income unil you convert it by selling it or trading it for something else of value. Then you have income but only have tax on that income depending on the holding period and your tax bracket based on your other income. Your second question appears to relate to how it affects applying for disability. Your btc transacted would fall into the same category as your gains on stocks or gold sold. You may not always have gains and therefore no income related to your btc holdings. The IRS has been advised by taxpayer advocate, Nina Smith in her report to congress this month that guidelines need to be issued for taxpayers. I believe the controversy is based on the use of btc as a currency, however the precedents in Canada and Singapore indicate that btc will be treated as as asset for now. I post tax and business related issues at www.bitcoinforbiz.com. It does not represent tax advice because it does not consider your individual circumstances. However, hoping btc gains will escape taxation will eventually evoke the wrath of the honey badger

empoweoqwj

hero member

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Everyone is handing out tax advice when the OP hasn't revealed what country he resides in. Putting the cart before the horse a bit Wink

Bitware

hero member

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weaving spiders come not here

It depends how you use them. If you buy them and save them, I believe they are a security/investment where capital gains profit and loss may come into play. If you accept them for products and services, then you may owe income tax on their value as per IRS rules on barter and trade. If you mine them, I believe no tax is due until you convert them into a recognized negotiable instrument. If they are gifted, depends who gave them to you and your gifting history, but usually this is income unless its a once-in-a-lifetime gift freebie from a relation/family they may allow to go un-taxed.

It's almost always best to check with your attorney, accountant or tax professional.

Trance

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Quote from: jongameson on January 22, 2014, 05:07:14 PM

Do I have to report Bitcoins as income, if I just buy bitcoin debit cards and use those for my purchases? I'm thinking of filing for disability too (for other reasons)

Are you trying to use the BTC for prepaid VISA and show cash spending receipts to claim under taxes for a refund ?

empoweoqwj

hero member

Activity: 518

Merit: 500

Quote from: jongameson on January 22, 2014, 05:07:14 PM

Do I have to report Bitcoins as income, if I just buy bitcoin debit cards and use those for my purchases? I'm thinking of filing for disability too (for other reasons)

What country do you live in?

Cryptopher

legendary

Activity: 1789

Merit: 1008

Keep it dense, yeah?

Quote from: jongameson on January 22, 2014, 05:07:14 PM

Do I have to report Bitcoins as income, if I just buy bitcoin debit cards and use those for my purchases? I'm thinking of filing for disability too (for other reasons)

This is something that needs expert advice on. I'm sure that some accountant and other legal experts are following Bitcoin with interest.

For the past few months I've considered Bitcoin as subject to capital gains tax (in the UK), but I saw that there was an article posted last week explaining HMRCs views on the taxation of Bitcoin. If I am being honest I didn't give it a proper read (tl;dr). I don't plan on selling my coins for fiat anytime soon anyway.

I would seek professional advice, after all, you have no comeback against advice on the forum.

qiwoman

sr. member

Activity: 294

Merit: 250

Each country has its own laws and tax regulations. One should ask their own local Tax adviser. For example in Thailand you are banned from using or exchanging/earning bitcoins so there it's a no no. Other countries like Germany recognise Bitcoin as a currency and here in Canada and the U.S people are getting paid salaries in Bitcoin..It just all depends on where you are residing.

franky1

legendary

Activity: 4410

Merit: 4766

will people stop asking for tax advise on forums and just go talk to an accountant.

each country is different but if you want a general rule.

imagine you buy a car, a painting, a lump of gold.. 6 month later you found out its more valuable. do you claim it as income.... HELLL NO. you only claimit as income when you sell it into FIAT.

taxmen only care about fiat. so if your fiat has not increased they cant tax you for it. so wait until you sell bitcoins before declaring tax.

and if this has not helped clarify things, go talk to a accountant

Bit4Biz

newbie

Activity: 5

Merit: 0

As soon as you convert bitcoin you have a taxable transaction. A long term capital gain is held over a year. If you are in the lower 15 per cent tax bracket, basically taxable income under $40,000 your capital gains tax would be zero.

olloman

sr. member

Activity: 433

Merit: 250

Crypto Angel

Quote from: keithers on January 22, 2014, 05:15:21 PM

Quote from: olloman on January 22, 2014, 05:14:15 PM

I am no expert, but I guess it is up to you as long as bitcoins are not directly taxed. If you convert them to fiat or report them for their value I think they will probably be counted as possession and hence taxed and probably will prevent you from getting a disability wage, but eventually depends on where you live and the local laws. Instead if you wanted a discussion on a more ethical/philosophical level, it is still up to you...I personally think it would not be right getting a disability wage when you don't need it, just think as if you were "stealing" it from someone who does need it...but I am not here to give lectures, and if you are into Bitcoins for superficial reasons you might aswell be a hyper-libertarian egoist Wink

Hey I just saw your profile to the left of your post, and I have more activity and posts than you, but I am the newbie and you are not...lol

huh I don't know why xD probably they changed some forum settings after the last attack, but it's just my guess ^^

edit: or maybe I'm satoshi, who knows Cheesy

edit 2: actually I think it depends on the time you have spent logged on to the forum, not the posts

keithers

legendary

Activity: 1456

Merit: 1001

This is the land of wolves now & you're not a wolf

Quote from: olloman on January 22, 2014, 05:14:15 PM

I am no expert, but I guess it is up to you as long as bitcoins are not directly taxed. If you convert them to fiat or report them for their value I think they will probably be counted as possession and hence taxed and probably will prevent you from getting a disability wage, but eventually depends on where you live and the local laws. Instead if you wanted a discussion on a more ethical/philosophical level, it is still up to you...I personally think it would not be right getting a disability wage when you don't need it, just think as if you were "stealing" it from someone who does need it...but I am not here to give lectures, and if you are into Bitcoins for superficial reasons you might aswell be a hyper-libertarian egoist Wink

Hey I just saw your profile to the left of your post, and I have more activity and posts than you, but I am the newbie and you are not...lol

keithers

legendary

Activity: 1456

Merit: 1001

This is the land of wolves now & you're not a wolf

depends on what country you live in. In the United States, you are supposed to report any extra income (in addition to your normal work), including investments, sales of goods, etc. I believe as of now they would fall under short or long term capital gains. There aren't any guidelines set in stone as far as I know...so I think it is more on the honor system as of now if you report it as income. Be advised that the IRS is notified of any deposits into your bank in excess of 5k, so if you have been regularly cashing out 5k or more per transaction, you are exposing yourself to an audit if you don't report any gains...

olloman

sr. member

Activity: 433

Merit: 250

Crypto Angel

I am no expert, but I guess it is up to you as long as bitcoins are not directly taxed. If you convert them to fiat or report them for their value I think they will probably be counted as possession, hence taxed and probably will prevent you from getting a disability wage, but eventually depends on where you live and the local laws. Instead if you wanted a discussion on a more ethical/philosophical level, it is still up to you...I personally think it would not be right getting a disability wage when you don't need it, just think as if you were "stealing" it from someone who does need it...but I am not here to give lectures, and if you are into Bitcoins for superficial reasons you might aswell be a hyper-libertarian egoist Wink

edit: your post changed drastically while I was writing my answer so I'm probably off topic now Cheesy

jongameson

member

Activity: 84

Merit: 10

Do I have to report Bitcoins as income, if I just buy bitcoin debit cards and use those for my purchases? I'm thinking of filing for disability too (for other reasons)

Topic: Income Tax and Bitcoins (Read 1562 times)