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So, if an individual buys BitCoin with some capital to not pay taxes for said amount of capital ,is he evading or avoiding?
by Fluxenein 10y ago
So, if an individual buys BitCoin with some capital to not pay taxes for said amount of capital ,is he evading or avoiding?
- paulsutter 10y agoIANAL but example taxable transactions might be to sell bitcoins for a gain, or to use appreciated bitcoins in a barter transaction. Losses are also taxable transactions, but in a good way. Mining is awkward, since I believe mined coins are taxed as income on the day they are mined, even if you don't transact. Best to talk to an accountant, of course, and not rely on the advice of a random HN commenter like me.
- justin66 10y ago> Mining is awkward, since I believe mined coins are taxed as income on the day they are mined, even if you don't transact. The IRS has indicated that bitcoins are property and taxed as such, so that seems unlikely. Do you have a source for this?
- paulsutter 10y agohttps://www.irs.gov/pub/irs-drop/n-14-21.pdf https://www.irs.gov/pub/irs-drop/n-14-21.pdf
- justin66 10y ago(Q-8 is the relevant FAQ on that doc) Thanks.
- Fluxenein 10y agoThanks, that helped. GNU Taler will be something to look forward to now.
- Daishiman 10y agoIf they're reporting it, sure. Companies defer profits all the time to do this within the bounds of what is legally acceptable. What's not fine is if the numbers only add up if you're not reporting.
- ksherlock 10y agoNeither because buying bitcoins doesn't help you not pay taxes. If you have legitimate money that's reported to the IRS and taxed, what you do with it is largely irrelevant. If you have illegitimate money (selling drugs, working under the table, etc) then you're not paying taxes on it to begin with. Buying bitcoin doesn't change that. (And if you're paid in bitcoin, that's bartering and you either report it or you evade it.)