BchainTalk Forum - Community for Blockchain Believers

Join like-minded people in a collaborative culture to share & learn.

Latest topics
» Intimate ICO Launches Sex Industry Token, 7 Days Until Pre-Sale Ends
Yesterday at 8:58 pm by Vladdirescu

» Crowd for Angels ICO Progressing Ahead of Schedule
Yesterday at 4:39 pm by Vladdirescu

» Market.space Announces Partnership with Web Shield to Secure the Decentralized Cloud
Yesterday at 3:53 pm by Vladdirescu

» Dreams On a Smart Contract
Yesterday at 4:50 am by Vladdirescu

» Twitter May Ban Cryptocurrency Ads, Following Facebook and Google’s Lead
Yesterday at 3:35 am by Vladdirescu

» Global Digital Finance to Manage Code of Conduct for Cryptocurrencies
Yesterday at 2:49 am by Vladdirescu

» Coca-Cola Together with the U.S. State Dept to Fight Forced Labor using Blockchain
Yesterday at 2:19 am by Vladdirescu

» Eligma - Revolutionary Approach to Online Shopping Using AI and Blockchain
Yesterday at 1:44 am by Vladdirescu

» Dinosaur Skeleton Set to be Auctioned for Bitcoin in France
Mon Mar 19, 2018 4:26 am by Vladdirescu

» Gaining That Competitive Edge: Safinus Jumps Novices Profitability In Crypto Trading, While Enhancing That Of Experienced Traders
Sun Mar 18, 2018 11:24 pm by Vladdirescu

» Securing the Future of the Internet Through IPSX
Sun Mar 18, 2018 8:45 pm by Vladdirescu

» Business School of the University of Oxford: the Blockchain Revolution is Yet to Come
Sun Mar 18, 2018 7:36 pm by Vladdirescu

» Fighting the Most Dangerous Security Problem Using Blockchain Tech and Ethereum Smart Contracts
Sun Mar 18, 2018 3:42 am by Vladdirescu

» Philippines Senator Calls for Applying a Get-Tough Approach to Bitcoin Crimes
Sun Mar 18, 2018 12:15 am by Vladdirescu

» Eggs in the Right Basket: Global Blockchain Offers Expertise for Capitalizing on Digital Money
Sat Mar 17, 2018 11:20 pm by Vladdirescu

» Chek is a Token Connecting Business and Charity
Sat Mar 17, 2018 5:54 pm by Vladdirescu

» Playboy Plans to Add a New FinTech Payment Option – Cryptocurrency
Fri Mar 16, 2018 9:41 pm by Vladdirescu

» Financial Solutions And Crypto Debit Card Provider Etherecash Launches ICO
Fri Mar 16, 2018 7:44 pm by Vladdirescu

» Blockchain is Conquering Global Stock Image Market
Fri Mar 16, 2018 7:02 pm by Vladdirescu

» Global Crypto AML Rules Enforcement Initiated by Japan to be Discussed at G20 Summit
Fri Mar 16, 2018 3:38 am by Vladdirescu

No, you can’t avoid taxes by investing in Bitcoin

View previous topic View next topic Go down

No, you can’t avoid taxes by investing in Bitcoin

Post by Kirti verma on Fri Apr 21, 2017 5:17 pm

If you think investing in bitcoin or a similar “crypto-currency” may be a good method for hiding income from the tax man, you’d better think again.

While many bitcoin aficionados tout the new virtual currency as a promising alternative to so-called “fiat” currencies like the US dollar, the IRS considers investments in bitcoin as property deals — requiring that capital gains or losses in this usually volatile medium of exchange be considered like stocks or bond sales and reportable on Form 8949.

But compliance with this requirement is virtually nonexistent, at least if you go by numbers reported by the IRS.

The agency began going after Coinbase, the largest bitcoin exchange operating in the States, in November 2016, requesting that the San Francisco-based company turn over data and complete transactions on every one of its more than 14 million accounts from 2013 to 2015.

But in court papers filed by the IRS this month — after Coinbase refused to honor the request, complaining that it was “overly broad” — the tax-collecting agency reported that only “802 individuals reported a transaction on Form 8949 using a description likely related to bitcoin” for 2015, the most recently concluded tax year. And this is apparently no fluke, with only 807 of the Form 8949s filed for 2013 and 893 for 2014.

This low level of reporting occurred during the same period (2013-2015) that the value of the currency (in dollars) went on a bumpy ride, skyrocketing from less than $20 to more than $1,100, presumably generating significant capital gains for many investors.

“In my view, 800 reports per year of profits and losses in virtual currency transactions is ridiculously low,” says Martin Mushkin, an attorney specializing in bitcoin law.

“The publicity given to this proceeding now and the forthcoming enforcement actions would result in a substantial amount of tax collections,” he adds. “The anonymity of bitcoin should not be allowed to foster tax evasion.”

Coinbase, for its part, blames the IRS itself for this underreporting, and its chief executive has called for creation of a Form 1099-B to be issued to each of its clients participating in a potentially taxable transaction — a proposal that the IRS has called low priority because of cuts to its budget.

“We’re very serious about complying with the laws and we actually support the idea that people who ought to pay their taxes do so,” says Michael Lempres, Coinbase chief legal and risk officer. “But the demand for three years’ worth of transactions conflicts with privacy interests.”

Mushkin and others familiar with the case say they expect Coinbase to cut a deal with the IRS. “I suspect that, as we speak, Coinbase is preparing an answer to the anticipated Order to Show Cause and negotiating the terms of the summons,” he says. “The papers show the parties have been talking, and Coinbase will try to cut this down.”

Coinbase is already registered with FinCEN, the Treasury’s Financial Crimes Enforcement Center, obliging the exchange to report transactions in excess of $10,000 per day and suspected transactions to be structured to avoid the $10,000 reporting threshold (such as multiple $9,750 transactions). The Coinbase response, Mushkin predicts, “will be to initially limit the subpoena to FinCEN reporting accounts and smaller accounts with large turnover volumes.”

Kirti verma

Posts : 11
Reputation : 0
Join date : 2017-04-15

View user profile

Back to top Go down

View previous topic View next topic Back to top

- Similar topics

Permissions in this forum:
You cannot reply to topics in this forum