Topic: Is the IRS going to tax me if I change my bitcoins to cash ? (Read 1266 times)

Yes, you should declare it as a capital gain, to avoid any risks in the future.

But I think of those who have made millions off Bitcoins by spending merely $15.

Actually he should declare the bitcoins as assets and not as an income. And it depends on the amount, OP you should try to contact an accountant and get professional advice before you declare anything to the IRS.

Anything you claim as income is taxable and should be reported under u.s. laws. There is no reason not to report it. No different than capital gains from a stock portfolio.

yeah again imho you should wait a few years to move any crypto in the usa for the law to get more clear......but eventually assuming BTC and or LTC or
whatever gets to be in big buck $$$ area...you probably as you move such funds from your coin to $$$ ...it will prob revert  to 20% capital gains or some such

best just to wait till that is the case for everything (mining etc) and not this nonsense that you have to pay capital gains on funds the day you got the btc
only taxes on what the cost of the coin is at that point in time (loss or gain works)

but anyway .... to get around such you would simply buy stuff with btc and not report it.....or something like that i guess my advice is for people hoarding
it will probably all work out in the end

or hell it will all go underground even more so for crypto

anyway I know zip..just my situation in that I am 'flagged' as a crypto biz due to circumstances ..even so ..with the biz and equip depr etc ...I likely (with
the amount I have in equip etc) break even more or less ie pay little if no taxes anyway....more by luck and being small then strategy

anyway again i assume this will all 'wash out' to something sensible in a couple years or you are gonna have a lot of BTC whales hiding large amounts of btc and
traveling overseas to spend it

When you sell with profits you've made capital gains and for that you have to pay taxes.
I'm no US citizen so I have no clue in how far you can avoid this for instance if you would sell your coins for cash and not via coinbase.

OR maybe you should buy something for your coins and then sell the bought items on craigslist or other local online markets in your area.

er yep if like in my case they know you have a btc biz (bank ratted me out had a bank error ...sec involved ..so had to declare a biz back in 2013 when
btc was EVIL

if you have the choice stay 'dark' when btc rules etc are in more clarity then say in 2017 say 'wow' i had a good year and if you go legal then don't say
you mined them (they tax mined coin at 25% at income) say you bought them or traded them (you had a good year in 2017) and pay the 20% capital gains
tax on whatever you said you got them for

myself can't make it to the trees..cut down by IRS gunfire ..save yourselves

but anyway side note....I can get 25% of my equip back towards taxes paid ..have paid no taxes thus..it will prob be a wash in 5 year (3 out of 5 must show
a profit or your biz they call a hobby)

so I prob will get the same place as a home biz with the equip depr and other CPA tricks (my CPA laughs says I'm a farmer lol )

but yeah supposedly (no one does it ) you are also supposed to pay capital gains on all virtual currencies from 2009 onward so if you made or bought a btc
in 2009 for 2c and got a stero with it for the price of btc now (285 usd say) you'd owe the IRS 284.98 usd taxed as capital gains at 20%


so my advice wait ..if btc gets high enough eventually the smart thing is to declare all/some of it and pay the capital gains to be safe on what you spend

but unless you are in my position due to circumstanes....I'd wait ..till they clean up the laws some ..but even I with mining my coin and the equip depreciation
it likely will be a draw.....with what i get back in equip vs any taxes on what I mined ...so just a bit of run around to the same place

only good thing is I'm so frigging legit if BTC goes to 10k and I buy a speedboat and buy the gold digger girl friend a car ..the IRS will have nothing on me
I'm so squeaky clean because of this bank issue and sec I squeak when I walk/talk btc

but for the rest of you just stay dark ..report what you move ...pay the 20% if it is a lot of cash you should be ok imho

here is a link to the irs guidelines and as for the capital gains on all coin from 2009 example above no one pays attention to that even the marshall's office
sale of seized btc this last year said screw that ......so again i suspect this 'guideline' will be changed for the better after the next presidental election imho

http://www.irs.gov/uac/Newsroom/IRS-Virtual-Currency-Guidance

Also my CPA has no issues with how to handle this .ie she is not joking when she says I'm a farmer.. the IRS wants me to buy equip so they can tax my crops
in this case mining at 25% thus I get the 25% over 5 years in equip depreciation ....I did not make enough in 2013 and 2014 for any taxes to be paid..this year
because I kicked ass and the LTC price went up (mining with titan(s)) I may have to pay say 3k as an example If i make 16k and taking off the 6k of equip depreciation
I will have this year for miners etc.....that is 10k .....1/4 of that is 2.5k prob say some off of that home biz etc so figure 2k ..but such is my lot in life cause
LTC decided to kick ass here lately

anyway next year my miners will be kaput ...less coin ..no taxes again ...etc as it winds down...so again if you are in my situation it will likely still work out

those who need to talk to a CPA

those who bought /holding/ the IRS has no idea you even have a btc or ltc address just wait till the laws get more coherent in next couple years
*just never tell them you mined it lol*

anyway what is going on with me due to circumstances beyond my control thou it was epic when the bank tried to screw me said i was not legit i pointed out
their error (i did not send 100k overseas sent 10k to knc) etc in front of SEC .then you guessed it when they tried to say I was an evil btc not legit fellow
slapped the home biz tax forms down by my cpa ..the last words from the sec guy on the phone i heard on speaker was "why am I here again?*

so considering my options on above I will not sweat the eventual 2 or 3k to the IRS don't ya know

anyway times are changing now my NEW bank thinks I'm a wonderful fellow BTC and LTC and all

in fact i don't know, he should be the one who tells you, but IRS will knows about it if he hold a large group of goats, $599 does not seems the case

there also a minimal income per year to be taxed, if you stays below that there is no tax and 599 is surely below that amount, at least this is how it work here, i don't know in the USA

Yes, if you make a profit, it is a capital gain.
Gifts are also taxable in different jurisditions. So it depends on the jurisdiction where your girlfriend is.

How did you know my friend taxed them goats to death prior to endowing them to me?

i don't think they are the same thing , with the first you can go away and not declare anything because they will never know about it, but it is taxable ....

the second should not be taxed because it was already taxed, presumably

If you sell, its normally a capital gain.

However, you're onto something.  There ARE  legal and permissible ways to structure your affairs to avoid paying taxes.
Many loopholes exist that wealthy people take advantage of all the time.  In fact some of the most powerful
corporations not only pay zero taxes, but actually receive hundreds of millions of dollars in tax credits.

What happens if you find ten one-hundred-dollar bills on the street. Does one need to file taxes that.

Do I have to pay taxes if a friend gives me $599 worth of goats because he no longer desires them?

Say an American citizen buys 10 bitcoins for $300 and then two years later sells for $500 through a company like coinbase.com

Will I have to declare this as a capital gain?

How about if that person decides to give the 10 bitcoins to his girlfriend who is not a US citizen.  What happens then?