So what happens to bitcoins which were seized by the US government?
Barr gives them to Trump to help pay off some of his debts before he flees the country
U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
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Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#292Earlier quoted context omitted.
This is the kind of magical thinking I'm talking about. If you owed the IRS tax money, you have a legal obligation to pay it, the IRS isn't responsible for coming and finding it. Garnishment or seizure are tools they can use to get the money, but the obligation is always there. If you don't pay you incur fines and penalties, potentially criminal penalties. You also have an obligation to report your assets. If you tri…
>You also have an obligation to report your assets. Do you? I own things that are worth money that I've never had to report to anyone. I see needing to report a gain when the asset is sold, but the asset itself is less certain. Do I need to tell them about the $100 bill in my wallet?
If it's at an overseas brokerage, you'll need to report make FinCEN report each year.
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#293I find it extremely amusing that the US government has over the last several years become one of the world's largest traders in bitcoin. It's not quite the path many were predicting back in the early 2010s, but Bitcoin has been full of surprises. If history is any guide, the bitcoin will be auctioned off sooner rather than later.
Not unless they can prove it was ill-gotten. It has to go through a trial
If only that were true. The FBI usually goes with the policy of "might makes right".
Especially for relatively low-value items (like laptops, phones, et c) stuff that the state seizes cannot be cost effectively retrieved, even in the absence of a charge or conviction. You're looking at a minimum of $10k USD in legal fees to begin demanding your stuff back.
The "innocent until proven guilty" policy is mostly a myth in the USA.
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#294Earlier quoted context omitted.
You can indeed 'rightfully stash $1B in cash under your mattress' - but almost any other private/public storage mechanism will involve gains/losses which have to be disclosed.
Wouldn't they only have to be disclosed when they get turned back into usable currency within your jurisdiction?
US citizens are taxed on their worldwide capital gains (and income).
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#295Earlier quoted context omitted.
They can "ask" you for your Bitcoin, but the question is phrased, "Would you rather give us your Bitcoin now, or would you rather spend some time in jail first and give us the Bitcoin later?" It generally requires a court order to get money out of your bank. If it's a Bitcoin wallet, then they can just send the court order to you directly, and put you in jail until you comply (i.e. as many years as it takes). The dif…
I don't believe that in most sane juridictions a court would keep a suspect in prison indefinitely when the suspect claims to have forgotten the passphrase for a bitcoin wallet. I think the court would have to find the suspect guilty and sentence them to an appropriate custodial sentence (which in my personal opinion would be no longer than what they'd get for deliberately forgetting the passphrase). The only incenti…
> I don't believe that in most sane juridictions a court would keep a suspect in prison indefinitely when the suspect claims to have forgotten the passphrase for a bitcoin wallet.
I think you overestimate the sanity of jurisdictions.
See RIPA for example: https://en.wikipedia.org/wiki/Right_to_silence_in_England_an...
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#296Earlier quoted context omitted.
Wouldn't they only have to be disclosed when they get turned back into usable currency within your jurisdiction?
US citizens are taxed on their worldwide capital gains (and income).
Right, but capital gains tax is calculated based on the profits relative to the currency in which it was bought and sold with. You have to sell the bitcoin or exchange it for another form of recognized currency in order to pay capital gains on it. This is more or less how stocks work as well.
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#297This is bad
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#298Earlier quoted context omitted.
do it with money you already paid tax on lol. so so many options
If you make more money with this money you stash away, that is taxable as well in most places in the western world. You normally also are obligated to inform the government wherever you are about your holdings in the west. The way to get around this, is to start an offshore company in whats referred to as an tax haven. Basically its a company that has an unknown owner normally some legal secretary or a lawyer firm st…
I don't think an offshore company gets around the requirement to report your holdings. You would legally need to report on that company and pay taxes on any profits if you are a US citizen.
But you could likely defer taxes this way, by holding the bitcoin with the offshore company. You would then only pay taxes when you liquidated the bitcoin and paid yourself something.
Whereas if you held the bitcoin yourself, you would need to liquidate to pay taxes every year that it increases in value.
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#299Earlier quoted context omitted.
No 'lol' because gains/losses on those assets relate to taxation, also, in many regimes you'll have to declare it anyhow.
which you only have to worry about when you have to tap into the rainy day fund, or when the collateral gets liquidated Because you can borrow against it instead of selling and without touching a financial institution, and this gives you liquidity without a tax event Welcome to the 2020s
>Because you can borrow against it instead of selling and without touching a financial institution, and this gives you liquidity without a tax event
But how do you repay the loan without liquidating the bitcoin?
Re: U.S. Feds Seized Nearly $1B in Bitcoin from Wallet Linked to Silk Road
#300Earlier quoted context omitted.
They can "ask" you for your Bitcoin, but the question is phrased, "Would you rather give us your Bitcoin now, or would you rather spend some time in jail first and give us the Bitcoin later?" It generally requires a court order to get money out of your bank. If it's a Bitcoin wallet, then they can just send the court order to you directly, and put you in jail until you comply (i.e. as many years as it takes). The dif…
>"Would you rather give us your Bitcoin now, or would you rather spend some time in jail first and give us the Bitcoin later?" A billion dollars is an enormous amount of money. The kind of money that could covertly pay an entire prison worth of guards to look the other way for an escape attempt. Of course, you end up on the run for the rest of your life, which doesn't sound especially fun.
That would require they are all educated about bitcoin, which is unlikely.