A community dedicated to Bitcoin, the currency of the Internet. Bitcoin is a distributed, worldwide, decentralized digital money. Bitcoins are issued and managed without any central authority whatsoever: there is no government, company, or bank in charge of Bitcoin. You might be interested in Bitcoin if you like cryptography, distributed peer-to-peer systems, or economics. A large percentage of Bitcoin enthusiasts are libertarians, though people of all political philosophies are welcome.
Hello /Bitcoin! I've been lurking here for the past year, just haven't made an account until now. This is my first year playing with Bitcoin and I had a question about when exactly the taxes for Bitcoin are applied in the US. I know that your profit is taxed once you exchange into fiat, but was wondering if it was taxed before or after you move your money from an exchange and into your bank account (is your profit taxed before the exchange fees are taken out, or profit taxed after the exchange fees are taken out)? For example, let's say I have $100 in Bitcoin on Coinbase (just using small numbers for simple math). Suppose the value of Bitcoin doubles, and I now have $200, and I decide to cash out. I will have made a profit of $100, but when withdrawing from Coinbase and depositing into my bank account, I will only be left with a profit of $97 (using Coinbase's 1.5% withdraw fee). Would I report the income made from my Bitcoin investment as $97 or $100 to the IRS?
Hi /personalfinance! I was wondering if anyone here knows of any resources I could use to help calculate taxes on profits made from Bitcoin? I asked a specific question about it over in /Bitcoin but had conflicting responses, so I figured I ask if anyone here knew of any good resources for filing taxes on it.
Seasoned HODLer here with a question. I’m expecting a big bonus in mid 2021 and I looked into call options for mid 2021 or end 2021 because I’m bullish. I signed up for an account on LedgerX but I’m unfamiliar with how bitcoin options are treated by the IRS. Let’s say I exercise an option at expiry and I decide to transfer the ownership of the bitcoin to an address, is that a taxable event? Scenario: I pay a $1500 premium for the option to buy 100 mini contracts at .01 btc each at a strikeprice of $50,000 with an expiry of December 31, 2021. Now let’s suppose S2F is right and bitcoin reaches $100,000 at expiry. I would then have a gain of $100,000 - $50,000 - $1,500 = $48,500. LedgerX would then give me the option to transfer ownership of the bitcoin once I fund my account. If just send that bitcoin to an address after funding the account for $50,000 is that event taxable? I get it’s taxable if I sell it. BUT is it taxable if I hodl?
Given the USA's power privilege on the world stage, if they were to adopt Bitcoin, instead of attacking it, and accept it as a form of tax payment, it might actually cement the US government's leadership role on the world stage for years to come. It's actually scary that this is one possible future
What if the US government decides to pay the Pentagon in Bitcoin instead of USD?
Hi all, I have a simple question on what event trigs a taxable event with bitcoin. i know buying bitcoin is not but selling, converting, trading bitcoin, as I understand, creates a taxable event. So wouldn't use of cypto cards, with each transaction, create a taxable and reportable event?
I'm planning on selling some of my Bitcoin for the first time. I know taxes are a long way away, but I want to make sure I've got my record keeping down. All of my Bitcoin has been gained as income for employment, over a period since 2017 (on and off). Previous years I never reported it because my total income was below the minimum required for filing taxes. This year I will (hopefully) be over the income to file, so I will be reporting my income that I've earned in Bitcoin this year as normal income taxes. However, I'm also planning on selling for the first time. I know the US charges capital gains tax on Bitcoin sales, but the way I have researched it, since my Bitcoin has been gained for a service (my employment), I do not have to list them as capital gains. Is that correct? Has this been everyone else's experience?
If you're a US citizen, the long-term capital gains tax you pay on Bitcoin is equivalent to a property sale (up to 15% depending on income). The long-term capital gains tax on Gold? 28%. Seems like another advantage to BTC over Gold.
Full disclosure: I hold both. But as an investor, I'm always looking at all of the various advantages in assets/positions. Tax implications are a big deal. To me and to institutional investors. I won't be surprised to see a lot of institutional investors choosing BTC as their inflation hedge in this current economic climate over gold-- or at least weighting it heavier (like I am). Time will tell though. Good luck guys!
In the US, lost your job, and selling long held Bitcoin to pay your bills? Watch out for estimated taxes and underpayment penalties.
Some people here are in the unfortunate position of having been furloughed or recently lost their jobs due to the pandemic, but are in the highly fortunate position of having well appreciated Bitcoin holdings that can be sold to pay your living expenses. In the US this situation presents a minor tax risk in that you might not be expecting. The IRS (and many states) require that you make payments through the year which total either 90% of your tax obligations or 100%* of last years taxes (* 110% if your AGI is over 150k). If you don't meet these requirements and owe $1000 or more in taxes there is an underpayment penalty of roughly 0.5% per month under paid plus interest (recently around 5% but it may drop to 3.25% due to the federal funds rate changing). When you have an ordinary job payroll tax deductions mostly take care of meeting your obligations, or at least getting close to them. However, if you lose your job and start living off selling Bitcoin you'll owe taxes on your capital gains and you won't have payroll withholdings. Any time you have large capital gains the same sort of risk exists but the combination of gains plus having lost your payroll withholding create an increased risk of large penalties. To address this you're supposed to make quarterly tax payments. Perhaps you're unable to do so. A tax penalty isn't the end of the world. Maybe because of the pandemic they'll wave or lower penalties (they have done so in the past when changes in taxes left many people under-withheld)-- I wouldn't count on it, it's better. Regardless, better to be forewarned so you can incorporate it in your planning!
hello , i have friend moved to USA (will stay there for 2-5 years ) , he want to transfer money to my country that don't support international transfer , solution is buy bitcoin in US and send it . Question is : there is any tax he have to pay it to IRS or the tax service ?( he want to send 5k$ ) i hope you get the idea of what i mean waiting for you guys thank's
Taxes on the blockchain before paying bitcoin taxes?
Would like everyone’s opinion as to whether there should be a movement to anonymise your cryptocurrency trail through privacy coins and DEX if the governments of your country refuse to put taxes obtained from bitcoin on the blockchain so that we can transparently follow the supply chain of goods and services the taxes are used for. In my opinion, if the taxes are coming from bitcoin using blockchain tech, what the tax is used for should also be transparent on the blockchain. So if your country puts the tax obtained from crypto gains on the blockchain, pay your taxes. If not, anonymise it as much as possible to break the trail. They don’t deserve the taxes if they do not contribute back to us bitcoin tax payers. The movement should also focus on making tax spending more transparent eventually leading to us taxpayers being able to choose where our taxes go to.
Tax for investing in US stocks and also in Bitcoins
Hi there. I am trying to understand when I have to pay tax and when not, now that I started investing. I live in UK and just recently opened and account in Trading 212 (ISA account) for buying stocks and in Coinbase for buying Bitcoin. My questions are:
Does earnings from US stocks count from ISA account as capital gains? ( I've read that earnings from ISA do not need to be reported to HMRC and are all tax free, but I also read that we need to pay tax 15% in our earnings from US stocks after passing the capital gain free allowance ) . What is true here?
If earnings from US stock count as capital gains and are taxed. Does that mean that only UK shares are tax free when investing from an ISA account ?
Is it correct that my coinbase account does not count as ISA, and all my earnings coming from Bitcoin count as capital gains, and will be taxed 10 or 20% after £12000?
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