I am not a tax expert, so take this with a grain of salt, but I believe these are accurate answers. 1. Once you mix your coins the value of a coin from your pe

I am not a tax expert, so take this with a grain of salt, but I believe these are accurate answers. 1. Once you mix your coins the value of a coin from your perspective becomes the average cost of a coin. So if you paid $1 for a coin and $100 for another coin, put both into something that made the distinction impossible, and then sold a coin for $150, you would have to pay taxes on $150 - ($100 + $1)/2 or $99.5 of income. Note that turning into non-Bitcoin is the event, type of Bitcoin does not matter, but anything but a Bitcoin does. 2. Technically you would have an income on your gains of xxx-w%. I don't know offhand if you could write off the expense, but I doubt it. 3. You are talking about bitcoins being bitcoins, so no taxable event. Whether it counts as an expense for writing off purposes is another point I don't know. This would likely be a loss so could be deducted. Your edit: Assuming you account for the value of the bitcoins gained at the time you gained them as income (which you should have) then you can consider that as the cost of the bitcoins. If you never counted the value of the bitcoins when you gained them then your cost basis is $0, so the entire value of the cash out is income. There may also be penalties involved in that but they likely won't care for small amounts of original value.