Topic: MSN article on BTC and taxes. - page 3. (Read 489 times)

What doesn’t make sense to me in the article is that if you make a purchase with btc your selling it for cash and then purchasing with it since it is property. How are you selling it for cash? If I buy a cell phone from you and give you .002 btc for it. Where is the cash conversion? There was no conversion. It’s a property to property trade. Also since it’s property. If I sell you a 100 bucks worth of btc for 100 cash. Then it’s a property purchase like I sold you that cell phone for a 100 bucks. People sell stuff all the time on eBay and Facebook with no income taxes paid.

Is it really a scare tactic when the IRS is trying to make sure US citizens follow the existing laws. It's probably helpful that they're releasing articles and reminders like this. The penalties for tax evasion are serious. I'd rather read an article like this than one about some new "Burt W" getting dragged through felony convictions for not reporting investment gains. The laws are simple. Bitcoin and other crypto currencies are an investment. If you sell your investment for dollars you should be paying the taxes on the gains or getting a tax credit for the losses.



First, you don't incur taxes if you purchase BTC. You incur a tax liability when you sell it back for Dollars.

The tracking is the same as if you were to win big a casino or sell your car. It's limited how well the IRS can track the transactions, but the responsibility to pay taxes owed is on the tax payer.

If you walk into your bank with $10,000 or more you have to file a form explaining exactly where you got the money. So, yes, your Banker will ask you about it.

The questions are precisely made to verify that you don't own the cash illegal, i.e,. through selling drugs or money laundering or any other illegal transaction.

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If you want to manage your tax liability I propose two things:

(1) Don't spend or sell your Bitcoin and you won't initiate a taxable event, or

(2) If you do intend to spend your Bitcoin, use a BitPay debit card which allows you to load the debit card with dollars converted from bitcoin in larger and price-consciously timed transactions. That way you're not incurring tax with each purchase, only the transfer to load the card.

If you think Bitcoin is a way for you to evade existing laws within your country, you are opening the opportunity for Governments to want to make more laws about the use of Bitcoin.

My wife just emailed me this article. The IRS is really trying to scare you into reporting your transactions.   

https://www.msn.com/en-us/money/markets/if-you-own-bitcoin-heres-how-much-you-owe-in-taxes/ar-AAv9Evn?li=BBnbfcL


If you make a purchase with BTC. Just how do they think they can charge taxes on that purchase? What a load of crap. Here is another thing that pisses me off. Have you ever walked into your bank with a large amount of cash and been questioned about how you got it by the banker?  Its cash. Its not illegal to own it and you don't have to explain how you got it. You saved it. I can bet though if I sold a bunch of BTC person to person and walked into the bank with cash there would be questions.