IRS reminds taxpayers to report virtual currency transactions

Post by asfasgasg » Mon, Mar 26, 2018, 4:05 AM UTC

CryptoPunk wrote: post #170

sekh60 wrote: post #147

Earlier quoted context omitted.

Ugh, not a cryptocurrency trader, but I recently learned that by having U.S. citizenship from birth, and though I never lived there, I'm responsible for FBARs and tax-filing in the states. $4000 or so later and I'm compliant now. What a stressful pain that was.

No surprise that in both Great Britain and the US, the income tax was first instituted during a time of war. Only during a war, with the demands it places on the public conscience to make sacrifices, would the population acquiesce to an institution so contrary to natural rights and so pernicious to liberty.

Post by asfasgasg » Mon, Mar 26, 2018, 4:14 AM UTC

jupiter90000 wrote: post #97

purple-again wrote: post #4

If you are walking down the beach and find a $20 bill on the ground, you are required to report it as income. The only way that I know of that you can legally enrich yourself without paying taxes is via a direct gift and that’s because the giver pays tax instead of you.

One other way is selling a home -- in certain circumstances, one can get $250k (single filer) or $500k (married filer) gains from the home sale tax-free. https://www.irs.gov/taxtopics/tc701

Post by spookthesunset » Mon, Mar 26, 2018, 4:36 AM UTC

throwawaybbqed wrote: post #234

anonymous5133 wrote: post #226

Earlier quoted context omitted.

I work as a tax auditor and this is completely false. Taxpayers only need to pay the MINIMUM amount of tax required by law, not the maximum. If you are audited then we will tell you why you owe additional tax. No, you will not go to jail for paying less tax but upon audit you will be required to pay the deficiency or provide additional explanations/documents etc. Then you can introduce any counter arguments like you…

I have two questions: 1) If one had used bitcoin as a currency (bought pizza, bubblegum, etc.), are these new "treatments" of cryptocurrency implying one has to report each of these purchases and the tax implication there in? 2) Lets say you are a miner and mine a bitcoin a month (I know not realistic but helps simplify question). Now, lets say you buy pizza with bitcoins from your wallet every month. What is the cos…

Post by letitgrowx » Mon, Mar 26, 2018, 4:43 AM UTC

bringtheaction wrote: post #14

tunesmith wrote: post #7

I thought you didn't need to unless you sold. If you simply buy or receive, that also needs to be reported? I have some of those stellar/lumens from when they awarded them for free for signing up back in 2016, but have never sold or transferred them.

Keep in mind: - Trading cryptocurrencies produces capital gains or losses, with the latter being able to offset gains and reduce tax. - Exchanging one token for another — for example, using Ethereum to purchase an altcoin — creates a taxable event. The token is treated as being sold, thus generating capital gains or losses. - Receiving payments in crypto in exchange for products or services or as salary is treated as…

Post by toast0 » Mon, Mar 26, 2018, 4:46 AM UTC

sokoloff wrote: post #144

tunesmith wrote: post #34

Earlier quoted context omitted.

The signup promotion in 2016 was for 5000 or 6000 lumens. Historically it looks like in 2016, 6000 lumens would have been worth five or ten bucks. So I guess that should be reported as income back then although it approaches being a rounding error. At some point, stellar converted lumens to stellar. Anyone know if that would be considered a taxable event? Did that change my basis?

Not a tax pro, but I would treat any involuntary conversion similar to a corporate action where you got new shares for old shares, the new shares inherited the basis of the old shares, and would generally not be a taxable event. This is assuming it’s analogous to a tax-free spinoff event in the equities world.