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Cryptocurrency & Tax?

38,970 6,569 April 15, 2018 at 10:56 PM
I read that people have to pay taxes on it.
Question:

How would the IRS know unless there is some info sharing?

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1

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#2
That's the case with lots of tax situations, and the legal burden falls on you to report all income, even from gambling or (yes, seriously, there's a way to do this) drug sales.

Ultimately it's up to your judgment. Does the IRS care if you received $50 in cash for babysitting? Made some trinkets to sell at a yard sale and made $200? Probably not, and if they did come across that information somehow, you'd just pay the tax due and that'd be the end of it probably.

But you better believe if you made $50,000 on bitcoin and the IRS does find out about it, they will come at you, and pleading ignorance will be a lot harder to get away with. It could be as simple as random audit one year, and when they review your banking records looking for unreported income, they'll ask about any large deposits you might have.

The problem that catches a lot of unsuspecting people is when they sell a lot of goods online but make very little profit. Suddenly Paypal sends them a 1099 (and the IRS) that says they received $22,000 last year. That might well be offset by $21,500 in cost of goods, leaving a tax bill on just $500 worth of income, but if you can't back that up with receipts you're in for a messy battle with the IRS. Same could apply with bitcoin if you're actively trading and showing large buys and sells. If you can't demonstrate a proper paper trail to show the cost basis for your assets you're going to get heavily taxed on the money you did receive. All that gets tracked well by your stock brokerage, but crypto requires a little more care on your behalf.
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#3
coinbase is reporting all usa transactions to irs
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#4
Quote from phillint
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coinbase is reporting all usa transactions to irs
and the spammer is back....mods, why do you let this guy continue to do this?
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#5
if you received a 1099 from Coinbase/GDAX or another exchange, then you should report it.
Read that it was about .04% of users reported it
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#6
Quote from aznboicn
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if you received a 1099 from Coinbase/GDAX or another exchange, then you should report it.
Read that it was about .04% of users reported it
if you receive a 1099, you have to report it. That for sure. Because it is reported to the IRS.

The question is for those whom didn't receive a 1099.
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#7
Quote from xxxHolic
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if you receive a 1099, you have to report it. That for sure. Because it is reported to the IRS.

The question is for those whom didn't receive a 1099.
Think I read that it was .4% of users reported. I know a lot of people that didn't.
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#8
Quote from aznboicn
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Think I read that it was .4% of users reported. I know a lot of people that didn't.
were those 0.4% received the 1099?
if you received the 1099 and didn't report. They will come after you later.
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Ta da.
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#9
Quote from fenderman
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and the spammer is back....mods, why do you let this guy continue to do this?
Would it make you feel better if he posted more facts?

On February 23rd, 2018, Coinbase notified a group of approximately 13,000 customers concerning a summons from the IRS regarding their Coinbase accounts.
Please refer to this document for the court's judgment. The court ordered Coinbase to provide taxpayer ID, name, birth date, address, and historical transaction records for certain higher-transacting customers during the 2013-2015 period.
https://support.coinbase.com/cust...tification


Legally you are required to include your gains on your tax return... Will you get caught if you don't? Maybe. Do you want to risk it? That is up to you.
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Last edited by TeeDub April 18, 2018 at 06:38 AM.
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#10
Quote from TeeDub
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Would it make you feel better if he posted more facts?

On February 23rd, 2018, Coinbase notified a group of approximately 13,000 customers concerning a summons from the IRS regarding their Coinbase accounts.
Please refer to this document for the court's judgment. The court ordered Coinbase to provide taxpayer ID, name, birth date, address, and historical transaction records for certain higher-transacting customers during the 2013-2015 period.
https://support.coinbase.com/cust...tification


Legally you are required to include your gains on your tax return... Will you get caught if you don't? Maybe. Do you want to risk it? That is up to you.
would it make you feel better if I pointed out that my issue is not with the accuracy of the bots statement, but rather the fact that its a bot? Fool.
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Quote from fenderman
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would it make you feel better if I pointed out that my issue is not with the accuracy of the bots statement, but rather the fact that its a bot? Fool.
Gotcha. If someone/thing answers a question and you don't get to hear yourself talk then obviously the answer is to resort to name calling.
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#12
C'mon guys... we all gotta pay our taxes. I mean, how else are we gonna fund all the illegal wars and bullying overseas?
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Nearly every problem and atrocity in the world boils down to someone's pursuit of imaginary things (religion, borders, money). Do away with these and humanity might have a chance.
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Quote from TeeDub
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Gotcha. If someone/thing answers a question and you don't get to hear yourself talk then obviously the answer is to resort to name calling.
You dont get it...the poster is a bot...see the other posts....its always a one liner drop and never responds to quotes...but if you makes you feel better to make excuses for keeping a bot here, then gotchaLMAO
You must feel stupid because you missed my point...and missed that the poster is a bot...gotcha...
"name calling" really? do you need a safe space to huddle in because I called a bot a bot?
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Last edited by fenderman April 22, 2018 at 06:43 PM.
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#14
Quote from fenderman
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You dont get it...the poster is a bot...see the other posts....its always a one liner drop and never responds to quotes...but if you makes you feel better to make excuses for keeping a bot here, then gotchaLMAO
You must feel stupid because you missed my point...and missed that the poster is a bot...gotcha...
"name calling" really? do you need a safe space to huddle in because I called a bot a bot?
When I'm feeling really cynical, sometimes I wonder if there's a competition among a group of sd employees to see who's bot/botnet can perpetrate the most click fraud.


*this probably isn't actually happening, but one wonders
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Why do conservative politicians oppose conservation?
Have you ever stopped to think the long-term GOP immigration policy might be to make the United States of America a less desirable place to live than Mexico?

"If you tell a lie big enough and keep repeating it, people will eventually come to believe it" -Joseph Goebbels
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Quote from jkee
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When I'm feeling really cynical, sometimes I wonder if there's a competition among a group of sd employees to see who's bot/botnet can perpetrate the most click fraud.


*this probably isn't actually happening, but one wonders
lol...so true.
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