3 ms·

> We don't tax people on the FMV of gold when they dig it out of the ground. Uh, yeah, we definitely do. I have relatives who sell the oil under their property

> We don't tax people on the FMV of gold when they dig it out of the ground. Uh, yeah, we definitely do. I have relatives who sell the oil under their property, and that absolutely is taxable income.

dcow 3y ago
The sale is taxable obviously and of course. The same is true for gold and crypto. But your relatives didn't get a tax bill for 25% of the value of the oil the moment it was prospected, did they? Their land value went up but they weren’t taxed on the value increase either (that happens when the land is sold).
- dgfitz 3y ago
  Maybe I'm mistaken, but my property taxes increase as the value of the property increases. The sales tax is a tax on the sale itself when sold at price $X.
  - dcow 3y ago
    Sorry I meant you're not taxed on the value of the oil at the moment it increases the property value. You are correct that eventually the property value might increase in the eyes of the county assessor or via sale of the property and there would be a measurable effect in that regard. Generally though, you also don't pay property taxes on securities (property tax is a pretty specific tax and a unit of crypto currency doesn't directly translate). I don't have any apropos objection to a property tax on crypto at the moment mostly because that's not the point being discussed. We just don't do it currently. The more appropriate analogy would be like you have barrels out and oil rained from the sky. Now you have some barrels of oil. Your land value doesn't increase, but also you don't get taxed because you collected oil from the sky. You get taxed when you sell the oil. Maybe we do need a tax on the latent potential of your property to generate crypto, or that information should be factored into property value, but again that's not quite what we're discussing.

3 ms·

> We don't tax people on the FMV of gold when they dig it out of the ground. Uh, yeah, we definitely do. I have relatives who sell the oil under their property

by Analemma_ 3y ago

> We don't tax people on the FMV of gold when they dig it out of the ground. Uh, yeah, we definitely do. I have relatives who sell the oil under their property, and that absolutely is taxable income.

dcow 3y ago
The sale is taxable obviously and of course. The same is true for gold and crypto. But your relatives didn't get a tax bill for 25% of the value of the oil the moment it was prospected, did they? Their land value went up but they weren’t taxed on the value increase either (that happens when the land is sold).
- dgfitz 3y ago
  Maybe I'm mistaken, but my property taxes increase as the value of the property increases. The sales tax is a tax on the sale itself when sold at price $X.
  - dcow 3y ago
    Sorry I meant you're not taxed on the value of the oil at the moment it increases the property value. You are correct that eventually the property value might increase in the eyes of the county assessor or via sale of the property and there would be a measurable effect in that regard. Generally though, you also don't pay property taxes on securities (property tax is a pretty specific tax and a unit of crypto currency doesn't directly translate). I don't have any apropos objection to a property tax on crypto at the moment mostly because that's not the point being discussed. We just don't do it currently. The more appropriate analogy would be like you have barrels out and oil rained from the sky. Now you have some barrels of oil. Your land value doesn't increase, but also you don't get taxed because you collected oil from the sky. You get taxed when you sell the oil. Maybe we do need a tax on the latent potential of your property to generate crypto, or that information should be factored into property value, but again that's not quite what we're discussing.