if you wait until 2014 youre just delaying the tax until next year.
if you have to pay taxes on capital gains shouldnt the IRS have to pay me for capital losses if i lose my investment?
Topic: Will people be selling after the 1st of the year for tax benefits? - page 3. (Read 4352 times)
December 28, 2013, 12:05:31 AM
December 27, 2013, 11:52:22 PM
some may claim their miner's as 'cost basis' as well... they didn't just appear in your wallet without expenditure. Electricity as well. Maybe even maintenance/administration costs too. All those USBees can be a nice tax write off in this manner
December 27, 2013, 11:28:19 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn? Bitcoin is very risky - I could make another trade tomorrow and lose it all or the exchanges could shut down and run away with the funds, get seized, or get hacked, and I could lose everything that way. This type of exchange risk isn't there in the stock market. The money I have on exchange is like imaginary cloud money goxbux disneydollars etc that could all be lost - I don't see it as real money that I've actually made yet. So I don't think taxes should need to be paid anyway until you actually withdraw USD back to a bank. What do you guys think?
In fact I lost money from BitFloor - can I deduct that?
In fact I lost money from BitFloor - can I deduct that?
All good questions. It would be much easier for everyone involved if the gov't just taxed fiat leaving the exchange. I wonder how on Earth people pay their taxes on automated trading algos? What a nightmare.
Also, what's to stop someone from saying:
- I lost my Bitcoin private keys, thus I have 100% losses.
- Those Bitcoins are not mine, I day traded them for a friend.
- The dollars on Bitstamp (for instance) aren't really dollars. They are (potential) claims against money in Bitstamp's bank account.
I think the bottom line is the IRS needs to make compliance easier in order to encourage compliance.
If it's true that coinbase.com and the exchanges don't report a 1099 to the IRS then the IRS won't know for the most part. The part that gets tricky is when you buy a Lambo or other extravagant items. In my case, I want to buy a house for the interest benefit. I have to show a certain amount of equity in order to qualify for a loan.
As far as losing private keys, you could certainly make the same point that a gambler makes when he says he may have won over $10,000 at one sitting (gets reported to the IRS) but then lost it at the tables the next couple days and thus owes nothing on the previous day's winnings.
December 27, 2013, 11:24:36 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn? Bitcoin is very risky - I could make another trade tomorrow and lose it all or the exchanges could shut down and run away with the funds, get seized, or get hacked, and I could lose everything that way. This type of exchange risk isn't there in the stock market. The money I have on exchange is like imaginary cloud money goxbux disneydollars etc that could all be lost - I don't see it as real money that I've actually made yet. So I don't think taxes should need to be paid anyway until you actually withdraw USD back to a bank. What do you guys think?
In fact I lost money from BitFloor - can I deduct that?
In fact I lost money from BitFloor - can I deduct that?
Many people think this but it is wrong per US law. Any transactions are considered taxable, it doesn't matter if you withdrawal the funds or not. Poker players on Stars or Tilt asked many of the same questions who were in a very similar situation.
Think of it as day trading. You add funds to ETrade. You buy and sell Tesla stock. You make money on some trades, you lose some. You never withdrawal funds. You still owe taxes on all the trades.
Now of course how does the IRS track offshore trading platforms...that should be the next question...ie, they can't. The US tax system is mainly based on the honor system. Until you get audited of course!
I think you're right. However, in my case and in the case of many others, we made just a few transactions and held for a good part after that. So the few times I bought in low and made money and then lost because I kept buying and the price went down, I am about even on completed transactions. However, the early purchases I have kept and haven't cashed out so they are not yet realized gains since I have not transacted them after first buying them.
December 27, 2013, 11:14:04 PM
If I withdraw btc into cold storage, and they are just in the cloud, then there are no assets in any account in my name. In that case, does the government still consider the btc to belong to me, and that I hold any assets? Also, does the government yet consider Btc a thing or a legitimate asset/currency? Does the gov give btc a value? Where does the value come from?
The real question is, how does the IRS handle people losing their private keys? In my opinion, it is no different than precious art lost in a house fire. Total loss. In that case, what's stopping people from telling the IRS that they lost their keys whenever they get audited? It is a claim which cannot be refuted. In that situation, I can't see the IRS being able to collect taxes on anything but fiat transfers back into one's bank account.
December 27, 2013, 11:09:15 PM
If I withdraw btc into cold storage, and they are just in the cloud, then there are no assets in any account in my name. In that case, does the government still consider the btc to belong to me, and that I hold any assets? Also, does the government yet consider Btc a thing or a legitimate asset/currency? Does the gov give btc a value? Where does the value come from?
December 27, 2013, 11:07:52 PM
Yes I plan on selling in early 2014 to fund 2013/2014 Roth IRA contribs.
December 27, 2013, 11:07:03 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn? Bitcoin is very risky - I could make another trade tomorrow and lose it all or the exchanges could shut down and run away with the funds, get seized, or get hacked, and I could lose everything that way. This type of exchange risk isn't there in the stock market. The money I have on exchange is like imaginary cloud money goxbux disneydollars etc that could all be lost - I don't see it as real money that I've actually made yet. So I don't think taxes should need to be paid anyway until you actually withdraw USD back to a bank. What do you guys think?
In fact I lost money from BitFloor - can I deduct that?
In fact I lost money from BitFloor - can I deduct that?
All good questions. It would be much easier for everyone involved if the gov't just taxed fiat leaving the exchange. I wonder how on Earth people pay their taxes on automated trading algos? What a nightmare.
Also, what's to stop someone from saying:
- I lost my Bitcoin private keys, thus I have 100% losses.
- Those Bitcoins are not mine, I day traded them for a friend.
- The dollars on Bitstamp (for instance) aren't really dollars. They are (potential) claims against money in Bitstamp's bank account.
I think the bottom line is the IRS needs to make compliance easier in order to encourage compliance.
December 27, 2013, 10:57:52 PM
Is there any way to avoid paying taxes?
Can I just open a new bank account outside the US and transfer my BTC there?
Can I just open a new bank account outside the US and transfer my BTC there?
December 27, 2013, 10:57:17 PM
As far as I understand it, Coinbase does not kick out a 1099 to the IRS.
Do what you will with that information.
Secondly, even ebay has a policy that they don't report until you've filled two requirements:
1) You have done over $20,000 in business, and
2) You have over 200 transactions within a calendar year.
Its not or. Its and.
Do what you will with that information.
Secondly, even ebay has a policy that they don't report until you've filled two requirements:
1) You have done over $20,000 in business, and
2) You have over 200 transactions within a calendar year.
Its not or. Its and.
December 27, 2013, 10:28:00 PM
Show me a man who pays taxes on his Bitcoins and I will show you a fkn loser.
Keep your pennies gentlemen. You will put them to far more positive and productive use than your governments will.
Keep your pennies gentlemen. You will put them to far more positive and productive use than your governments will.
December 27, 2013, 08:50:50 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn?
Yes. But without that USD entering your bank account, how will IRS know?Question is, will you report each trade?
Hell, BTC-E doesn't even require dox.....
(ahem, I mean, pay your taxes......)
December 27, 2013, 08:41:58 PM
It would be more wise for those who are taking earnings out throughout 2014 to take it out steadily throughout the year.
To take it out on January 1 when the price could jump 10x (as it has done most years) by 2015 would be foolish.
To take it out on January 1 when the price could jump 10x (as it has done most years) by 2015 would be foolish.
December 27, 2013, 08:38:42 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn?
Yes. But without that USD entering your bank account, how will IRS know?Question is, will you report each trade?
Hell, BTC-E doesn't even require dox.....
(ahem, I mean, pay your taxes......)
December 27, 2013, 08:37:30 PM
I sold ~$50k this year (Novemberish) to see what will happen with my taxes. I should know by April 15th if I'm going to continue to live in the US or not as I still own coin. If you guys want, I can start a blog about it or something. Right now I'm just doing as many home improvements and charity donations as I feasibly can.
Or if you could post in this thread. I think I will do the same.
The problem is how many accountants are well-versed in bitcoin, not to mention altcoin transactions? Would your local CPA know how the IRS considers these investment vehicles? Or am I going to have to find a bitcoin accountant online?
I'll try doing Google searches to find out.
I'd also like to find an accountant who understands bitcoin as mine is considering it currency trading ala Forex. I don't know if that is correct or not. I'd be happy to go to someone else who is an expert in this. There were a lot of losses and even more wins.
If names come up, please let us know. I'll also look....
December 27, 2013, 08:19:21 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn? Bitcoin is very risky - I could make another trade tomorrow and lose it all or the exchanges could shut down and run away with the funds, get seized, or get hacked, and I could lose everything that way. This type of exchange risk isn't there in the stock market. The money I have on exchange is like imaginary cloud money goxbux disneydollars etc that could all be lost - I don't see it as real money that I've actually made yet. So I don't think taxes should need to be paid anyway until you actually withdraw USD back to a bank. What do you guys think?
In fact I lost money from BitFloor - can I deduct that?
In fact I lost money from BitFloor - can I deduct that?
Many people think this but it is wrong per US law. Any transactions are considered taxable, it doesn't matter if you withdrawal the funds or not. Poker players on Stars or Tilt asked many of the same questions who were in a very similar situation.
Think of it as day trading. You add funds to ETrade. You buy and sell Tesla stock. You make money on some trades, you lose some. You never withdrawal funds. You still owe taxes on all the trades.
Now of course how does the IRS track offshore trading platforms...that should be the next question...ie, they can't. The US tax system is mainly based on the honor system. Until you get audited of course!
December 27, 2013, 07:55:55 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn? Bitcoin is very risky - I could make another trade tomorrow and lose it all or the exchanges could shut down and run away with the funds, get seized, or get hacked, and I could lose everything that way. This type of exchange risk isn't there in the stock market. The money I have on exchange is like imaginary cloud money goxbux disneydollars etc that could all be lost - I don't see it as real money that I've actually made yet. So I don't think taxes should need to be paid anyway until you actually withdraw USD back to a bank. What do you guys think?
In fact I lost money from BitFloor - can I deduct that?
In fact I lost money from BitFloor - can I deduct that?
All good questions. I'll try to find out by finding an accountant who has experience with these things.
December 27, 2013, 07:55:03 PM
I sold ~$50k this year (Novemberish) to see what will happen with my taxes. I should know by April 15th if I'm going to continue to live in the US or not as I still own coin. If you guys want, I can start a blog about it or something. Right now I'm just doing as many home improvements and charity donations as I feasibly can.
Or if you could post in this thread. I think I will do the same.
The problem is how many accountants are well-versed in bitcoin, not to mention altcoin transactions? Would your local CPA know how the IRS considers these investment vehicles? Or am I going to have to find a bitcoin accountant online?
I'll try doing Google searches to find out.
December 27, 2013, 07:35:29 PM
I presume we can deduct silk road loses?
December 27, 2013, 07:32:23 PM
Do bitcoin profits count for taxes if you only have usd on an exchange but haven't withdrawn? Bitcoin is very risky - I could make another trade tomorrow and lose it all or the exchanges could shut down and run away with the funds, get seized, or get hacked, and I could lose everything that way. This type of exchange risk isn't there in the stock market. The money I have on exchange is like imaginary cloud money goxbux disneydollars etc that could all be lost - I don't see it as real money that I've actually made yet. So I don't think taxes should need to be paid anyway until you actually withdraw USD back to a bank. What do you guys think?
In fact I lost money from BitFloor - can I deduct that?
In fact I lost money from BitFloor - can I deduct that?
Jump to: