Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

IRS Says Bitcoin Is Property

bloomberg.com

Post reply on HN
Print view View original

1–10 of 317 posts

Re: IRS Says Bitcoin Is Property

#3

Post by antr »

I'm not familiar with US tax, but isn't property tax in the US something like 200bp per year?

If I understand this correctly this can be a huge blow for Bitcoin users in the US

Re: IRS Says Bitcoin Is Property

#4

Post by mjn »

antr wrote: post #3

I'm not familiar with US tax, but isn't property tax in the US something like 200bp per year? If I understand this correctly this can be a huge blow for Bitcoin users in the US

The U.S. has no property taxes in that sense (a tax on all owned property, more commonly called a "wealth tax"). Some states have a tax called a "property tax", but it applies only to land and buildings ("real property"), not to other kinds of property such as stocks, baseball cards, gold, bitcoin, bank accounts, paintings, etc.

Re: IRS Says Bitcoin Is Property

#8

Post by uptown »

"Under the ruling, purchasing a $2 cup of coffee with Bitcoins bought for $1 would trigger $1 in capital gains for the coffee drinker and $2 of income for the coffee shop."

So if the coffee shop leaves the "property" as bitcoins instead of converting it over to dollars, and the value of those bitcoins falls before cashing-out, they're stuck paying tax on the $2 worth of income despite potentially no-longer having the funds to cover those taxes.

Re: IRS Says Bitcoin Is Property

#9

Post by thematt »

Interesting, but unsurprising. The more interesting aspect is that unlike tangible property, bank accounts or stock transactions that can be audited, this seems practically unenforceable on the IRS's part.

Re: IRS Says Bitcoin Is Property

#10

Post by jcampbell1 »

It seems there are hypothetical scenarios where your taxes could exceed your net worth. If you mine a bitcoin worth $1000, and then it's value falls to $100, you could owe taxes on $1000, and the $900 capital loss would only carry forward to the next year.
Post reply on HN