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What's you seem to be missing (I think) is that you do not pay taxes on buying a coin for $950 even if it's only worth (face value) is $50.
by invisible 17y ago
What's you seem to be missing (I think) is that you do not pay taxes on buying a coin for $950 even if it's only worth (face value) is $50.
- tptacek 17y agoHuh? You don't pay taxes on buying a $50 item for $950, because you've just taken a $900 loss. If you sell something for which you paid $50 for $950, you absolutely do pay taxes for the gain.
- byrneseyeview 17y agoThat's not the transaction for which you would be taxed. But if you're paying your workers something that you claim is worth $50, for which you spent $950, that $900 difference is money that would be an expense if you paid them normally. Instead, it's profit, and you owe $300 in taxes on it -- even though you have the negative cash flow from your $950 coin. That's what's missing from the story. Either we're reading it wrong, or what he committed was a conventional tax fraud with a gold-bug spin.