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Should you pay taxes on Bitcoin?

  • MusicMoguls Level X3
    • 10

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    Should you pay taxes on Bitcoin?

    Bitcoin is the crypto currency king and many people trade it, use it, and mine for it on a daily basis. It's becoming so popular that governments are scrambling to try and figure out a way to tax it. Just recently the IRS is asking the federal treasury to come up with a tax plan for this digital currency. The plan is to consider it an asset so that it can be taxed. They want you to pay taxes on digital wages and same small business or self employment taxes will be used.

    Should you pay your taxes? The answer im going to give you is yes. You should not try and avoid taxes buy using Bitcoin. I know that not all people are honest and im pretty sure alot of people are avoiding taxes. The IRS will come after you and you will have to pay your taxes one way or another. I am not saying that its impossible to hide money what im saying is i don't recommend it.


    Here are the new guidelines set by the IRS for you to follow:

    https://www.irs.gov/uac/newsroom/i...urrency-guidance


    As always thank you for reading please don't forget to follow me and like the topic.

    https://listingdock.com/user/jkeyz2

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    #Bitcoin #Digital #Currency #Crypto #Irs #Taxes #Federal #Usa #Treasury Technology & Internet
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    Lynne

    Lynne

    Thanks Jkeyz2. I thought that a huge part of the current appeal of Bitcoin is that it is not regulated in that way. I guess though that is was only a matter of time until the tax authorities get into it right? Quite rightly, it is an asset if it has monetary value.

    I agree with you paying taxes is always the right thing to do.
    9 years ago

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    MusicMoguls

    MusicMoguls

    Its the rite thing to do especially for me. Im reading what Mike posted below though and he is making me rethink. It was only a matter of time before the governments started to try and tax it. The question should be should Bitcoin be taxed? if i was living here in the USA and i had a business in Europe and i had a bank account i would be paying taxes to Europe. If i only have Bitcoin well then guess what? Its like me having currency and making currency in a different country. Im not saying this is rite but if you use a hardware wallet, a VPN to access it, and you never cash out. The governments of the world have no way of taxing it, they also have no way to freeze your money if you dont pay. Here in the United States they will lock you up so pay your taxes lol!
    9 years ago

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    idealmike

    idealmike

    No! Did you know that it's actually an illegal act to charge people taxes? See: Are Income Taxes Unconstitutional or Illegal? Taxes were introduced by greedy kings many hundreds of years ago and governments have followed this shady practice ever since! The point of crypto currencies is to have a currency you could trade in that cannot be taxed, regulated and monopolized by the government. I think that the government is trying to tax people who use bitcoin and other crypto currencies is an act of war. Governments don't own the revenue that crypto currencies hold. They don't own the technology (block chain) that produces it. So they shouldn't be able to tax people on it when it's not recognized as legal tender in any jurisdiction.

    Of course, we should pay taxes on wages and and other payments made to us. Without taxes there wouldn't be any real way to pay people who work in the civil industry like police, firemen, hospitals and education systems and the like. They would have to be constantly rallying around for donations. And in the UK, tax and NI goes towards these things (NHS), and things like street lighting and the like. So I'm happy (well happy is a bit of a strong word), more "okay" to pay my taxes knowing they are going to go towards these things that I might need.

    But to try and regulate and tax a currency that isn't even recognized as legal tender in any jurisdiction is just a crime in my books. It's like, if I was to pay you for something in 50 bananas that I grew in my back yard, and the government was to say, well, we want 10 of those bananas for each 100 bananas you grow. And then say to you, we want 5 of those bananas they paid you in. Well that wouldn't be right. I grew these bananas myself in my own backyard in a property on land that belongs to me. In the same token, crypto currencies are home grown and created using technology that anyone can use. Why then should we have to pay taxes on something the government didn't create?

    The government prints money. So we have to pay tax on that because it's their money. But the government didn't print crypto currency, they didn't create the technology that is used to create it. So they shouldn't be able to tax it either. Of course, like most taxes, many people will just shut up and pay it and all the while the bullies that are the government will be laughing behind our backs, all the way to the bank!
    9 years ago

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    MusicMoguls

    MusicMoguls

    The thing is Mike nobody upholds the constitution or our amendment rights. If im correct i think federal taxes didn't start until after 1900. We still had police and roads and everything else we have now. I am surprised the American people have not rioted with the 40% income tax we have to pay. We started a war over a tea tax of 2-3%! I don't understand how this happens but what i do know is that if you don't want to pay taxes and if you feel like its slavery maybe with enough money and a good lawyer you can pull that off. Great analogy and thank you for taking the time to share your opinion.
    9 years ago

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    hitmeasap

    hitmeasap

    Insightful reply as usual, Mike. I appreciate it but how would that play out if you sell you BTC for cash then? - I mean, BTC in itself has a value of course but from my understanding, most people who are using BTC "as a regular user" (not being BTC experts who's holding and trading that is) sells their BTC for real money, so they can withdraw them in an ATM or whatever they want to do. Basically so they won't have to limit themselves to use BTC. - How about these scenarios? - Do you think they would need to pay taxes on that money?

    I mean, the person who buy your BTC have probably already paid taxes to begin with. So that would be taxes on money you've already paid taxes on.
    9 years ago

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    idealmike

    idealmike

    I thought that might be Andre and I'm willing to be put right if I'm wrong about anything. I'm passionate about tax having to pay tax myself and after all the experiences I and my friends and people I know have had with Mr Tax man. I remember a case just recently where my friend got a brown envelope letter from the tax man (HMRC) telling him he owed just over £1000 in tax to them for work he'd done between 2011-12. But after he argued his case and showed that he was PAYE and proved it they dropped it. That's just an isolated case but there's many more like that. The thing is, a lot of people, old people in particular, would just get a brown envelope in the post telling them they owe this much money and most people would just say oh okay then and pay it. But some of those people genuinely don't owe that money and HMRC don't tell you that. I can't speak for IRS on that case but he used knowledge as his power and this is a guy who knows a lot about governmental conspiracies and the like. I borrowed a book from he recently called "The Secret History of the American Empire The Thruth About Economic Hitmen, Jackals and How to Change the World". It shines light onto dark areas of the government including the IRS system and how it can never benefit the common man or even those that hold the funds (IRS/HMRC) in the long term.

    So do people "need" to pay taxes on bitcoin converted to USD. Well like all earnings, virtual (intangible) such as earnings from freelance work, and physical (tangible goods). The government has already passed a law to say that you need to pay taxes on all earnings. You need to declare everything you make over a certain amount. In the UK that's £10,600. ($4,000 for US residents). And the law says if you don't pay your tax you'll be prosecuted and that either means a fine or prison. Which I (and many others) think is a really wrong system. It's not that I'm against paying tax. It's just what that tax goes on and is spent on that matters. When you have councilors and MP's spending $100k on luxury first class air travel and pads in Manila and the like and you see nothing being done to improve the areas that you live in or live near it kinda makes you question just what it is the government is collecting taxes for in the first place.

    So yeah, you would need to pay taxes on all money earned in USD. Whether it's through physical work or online or something. That would include bitcoin as well. From that perspective of the law. But all I'm saying is to think outside the box, just because the government says you need to do something, like pay tax on some earnings, that doesn't mean that it's right. Especially when all you see and hear about is countries going to war and spending peoples taxes on buying weapons for war, rocket launchers and fighter jets and other big guns and weapons of mass destruction. That's what you're really paying for. So they can spend your money on luxury items we don't really need that will just sit and gather dust for 100 years until it's replaced with an upgraded version and then sold off to the nearest bidder. The US army actually sells a lot of its old weapons to OTHER countries! And most of that is then sold off to other smaller countries and arms dealers and some of those include terrorist cells. But that's okay because it's all money going into the country and is all "non-taxable". Well the government can't tax itself!

    Okay okay I know some of it does go back into the country but not enough! Not far enough! I see hospitals and health clinics, schools, universities and businesses struggling to make ends meet. Not enough equipment needed to care for, educate and help people to succeed all around my country and in other countries too including the USA. Cor what about the US health system? I couldn't imagine having to pay thousands of dollars if I broke my leg if I didn't have insurance that covered it. In that sense, I'm kind of glad of how my own revenue system works and that we have the NHS because of it.

    But I don't know, I just see it as big brother trying to invade and always looking for a way to tax something. One day I think they'll even try and tax the air that we breath!

    I'll leave you with that and shut up now lol
    9 years ago

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    Lynne

    Lynne

    Yes I think sometimes big time chances are taken by agencies and the little guy just coughs up. We had a huge problem here with the municipality and out water bills... I won't go into it but they were just screwing us and it is upsetting!
    9 years ago

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    MusicMoguls

    MusicMoguls

    We cannot trust the governments the greed and corruption is out of control. Especially in South Africa.
    9 years ago

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    MusicMoguls

    MusicMoguls

    You don't have to pay taxes until you cash out. Then they charge you almost 40% of your money. You don't have to pay taxes the government has no way of keeping track of it unless your buying houses and cars with BTC. Even when i cash out i still don't have to pay taxes all i have to do is cash out using Localbitcoins.com. It allows users to deal directly with each other to sell or buy Bitcoin. They can deposit money into your bank or send it via paypal, or money gram, Etc. No way to keep track of these types of transactions. I never recommend trying to deceive the IRS out of taxes. They will find out eventually and you will go to jail.
    9 years ago

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    Corzhens

    Corzhens

    Is the IRS watching the Bitcoin owners? I wonder how you pay the taxes when the Bitcoin is just a pseudo currency. My take on Bitcoins is that it is a commodity with value because you have to sell it in order to convert it to cash. You cannot spend Bitcoin and use it to buy food in the supermarket, right? If that is a commodity then how would you pay the taxes?
    7 years ago

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