111–115 of 115 posts
Earlier quoted context omitted.
I had the same problem with the Canadian equiv (CRA). I just treated it like I bought it all at $0 / BTC. I was selling between $100 and $1000, with an average purchase price between $4 and $10, so the cost was basically minuscule.
I would personally be wary of a $0 purchase price since that seems more like a gift to someone reviewing it.
Earlier quoted context omitted.
This is not tax advice but from what I've seen in news reports, the IRS has different rules for currency. The reason bitcoin users have to report every little gain/loss is that the IRS doesn't consider it currency.
And the main reason they don't consider it currency is to impose a tax that discourages its use. Without capital gains, if Bitcoin had ~0% inflation and the US got back up to 5%-10% inflation, then Bitcoin would become a better store of value. However, with capital gains, the US would have to have significant inflation, around 20% or more, before Bitcoin would really be competitive. (I'm assuming there are significan…
Just to be clear, I'm not agains taxes, because not paying taxes is like swatting an apartment, and generally taxes make sense to be paid, although most places also have several unfair tax codes, so I understand the common perception of taxes as "highway robbery".
Earlier quoted context omitted.
Is there a "first bought, first sold" clause in US tax law regarding securities, or is it the average purchase value of your total holdings during a sale that counts? E.g. I buy 10 BTC for $1 and then buy 10 BTC for $50 and then sell 10 BTC for $100: I have to pay tax on ($100-$1)
> Is there a "first bought, first sold" clause in US tax law regarding securities, or is it the average purchase value of your total holdings during a sale that counts? Neither. It's all specific lots (individual orders). How Coinbase chooses which bitcoin to sell will affect what tax you owe. With a typical brokerage (e.g. Vanguard), you can configure individual securities to sell FIFO, lowest cost, avgcost, or spec…
Earlier quoted context omitted.
> Is there a "first bought, first sold" clause in US tax law regarding securities, or is it the average purchase value of your total holdings during a sale that counts? Neither. It's all specific lots (individual orders). How Coinbase chooses which bitcoin to sell will affect what tax you owe. With a typical brokerage (e.g. Vanguard), you can configure individual securities to sell FIFO, lowest cost, avgcost, or spec…
How is anyone supposed to distinguish the first 10 BTC from the last 10 BTC when the underlying satoshis might not even be the same? e.g. I might transfer those 10 BTC to an online store (web wallet, other trading, whatever) but then transfer them back, except I'll likely get a different 10 BTC. Seems like all you can determine is that you once bought $x and once sold $y. Since you can also exchange btc for goods, or…
That's all that matters. Your gains (or losses) are $y - $x.
> it seems like there's nothing stopping someone from always taking the least expensive taxes first.
Yes. If you had some with gains and some with losses, you could even choose to sell those at a loss in order to offset other gains.
Earlier quoted context omitted.
Two counters: 1) These are bit players in the world economy, with nothing like the clout that the US derives from manipulating the world economy via seigniorage, reserve currency status, monetary policy and the ability to lock other countries out of the global economy 2) They will all change their tune if/when crytocurrencies start impeding the state's ability to make policy and collect taxes. There's a digital curre…
> There's a digital currency in our future, but I guarantee that it won't be decentralized and that the government will have the signing keys. That might be possible, but its too early to say anything at this point in time. The thing is that Bitcoin has technologically established itself as a stable crypto-currency and also an open-source wallet software. In future, some governments may also come up with their own ce…
I feel like some Syrians would disagree.