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You are so wrong. Spending crypto using a card is actually what people want in order to avoid taxes on crypto as it's treated as a security from the IRS tax pe
by gt565k 6y ago
You are so wrong.
Spending crypto using a card is actually what people want in order to avoid taxes on crypto as it's treated as a security from the IRS tax perspective.
Anyone who has made money on crypto would love it if they can just spend the crypto as currency and buy every day things with it and remove the tax liability from having to convert to fiat.
15% tax capital gains, no thanks, let me spend it on food and furniture.
- gnaritas 6y agoYou are wrong, the ability to spend it in no way removes your tax liability. Currency traders still owe taxes on their gains, it doesn't matter what currency it is, if you make gains you owe taxes. You don't owe money because you convert to fiat, you owe money because you made gains.
- martamorena923 6y agoOMG in what country do you live? 15%??? We have to pay 50% on this in Canada, well at least the ones who are in the top earning bracket. I would gladly pay the 15%. I mean how greedy is it to make these kind of gains in crypto and then trying to avoid a measly 15% of tax lol.
- xsmasher 6y agoAre you sure you pay 50% in tax on the profits? A quick google suggests that 50% of the profits counts as income, which is then taxed at your income rate. 50*50 = 25% in the top bracket. In the US long-term cap gains is 0%, 15%, or 20% - not far off from 25%.
- draaglom 6y ago_people_ may believe that but I don't think the IRS does. Spending crypto that has appreciated in value on goods and services is still a taxable event for CGT purposes.
- PragmaticPulp 6y agoExactly. "Spending" the cryptocurrency is just convenient UX over the exchange process. Using a credit card that abstracts the details doesn't get you off the hook from paying capital gains tax.
- 01100011 6y agoDoes bartering an investment vehicle allow you to escape capital gains? If so, that seems like a loophole that should be closed. Why should you be exempt from gains on your capital investment? It seems like MasterCard should be reporting each swap of crypto for dollars to the IRS and sending you a tax form at the end of the year. If that's not the case, expect regulatory action to correct it.
- jkepler 6y agoNope, bartering (at least in the US) is still taxable on the fair market value of whatever you're exchanging.
- kelnos 6y agoSpending the crypto through a card will not stop the IRS from coming after you for their cut.
- svachalek 6y agoAt least in the US, spending crypto is taxed the same as selling it. https://www.coinbase.com/learn/tips-and-tutorials/crypto-and-bitcoin-taxes-US https://www.coinbase.com/learn/tips-and-tutorials/crypto-and...