BlackCrayon

for now that might be true but who knows for how long. fact is people should be paying for any gains made on the coins when you exchange them for goods or services.

__________________
you don't know you're wearing a leash if you sit by the peg all day..

L-Pink

Incorrect; and I'm not trolling.

At what price did you acquire the bitcoin? What is the current value of the service or product you are trading it for?

The value of the product/service minus your bitcoin acquisition price is the taxable amount of your transaction. (a negative is a loss carry forward on your taxes)

The decision to pay taxes or not is yours to make and has nothing to do with "internet currency". It has to do with profit earned. I paid my pool guy $120. per month weather he paid taxes or not was his choice as well.

Telling someone they owe no taxes is bad advise and evasion on their part.


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L-Pink

If I have a bitcoin I mined at $7 and give it to your company for $100 worth of product I owe taxes on the $93 gain.

What you owe on the bitcoin depends on your companies profit/loss on that coin when you use it. Telling someone it's a tax-free exchange is wrong.


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facialfreak

Please do not try defame me or my company, because you do not understand the concepts of deferring income tax, and personal/business tax shelters.

Savvy business owners fully understand the concept behind deferring income tax. What the IRS (or CRA, or similar agency) does not make from YOU as income tax, they will make from the merchant - as sales taxes and/or income taxes. This is NOT tax evasion in any way, shape, or form.

What I am saying is that the tax burden is on the person who converts the coin for cash value. Taxes will be paid on the transaction, but if you are not the one claiming a fiat financial gain, then no, you are not required to pay taxes on it.

I have given you my credentials ... please tell me yours.

Tax deferring is not tax evasion .... businesses have practiced tax deferring as a way to reduce their tax obligations for a long long time, and it is not illegal.

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L-Pink

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adult_text_links

Bravo Nicely Said!

L-Pink

"Are you going to tell me that depositing personal checks into your credit card account -- to be applied towards paying your credit card is tax evasion too?"

Nicely said? Your personal check didn't increase in value did it? The increase in value of an asset is taxable at each transaction. In the US you can't realize a gain without accruing that gain and paying tax on it at year end.


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dyna mo

L-Pink

Right from the IRS ……………...

"Almost everything you own and use for personal or investment purposes is a capital asset. Examples include a home, personal use items like household furnishings, and stocks or bonds held as investments. When a capital asset is sold, the difference between the basis in the asset and the amount it is sold for is a capital gain or a capital loss"


Your customer either made or lost money on their bitcoins and buying something from your company in no way negates any tax owed.

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helterskelter808

You can't correct me because nothing I said is incorrect; repeating "you don't understand" won't change that fact.

dyna mo

Hey big L, how does the irs view an exchange for services rendered? is that = to being sold?

dyna mo

ok, now what?

i rly wasn't in the mood to argue with you but it doesn't make any sense for you to expect me to defend bitcoin to you either. that's whj i mentioned i've posted so much about it.

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So I cant go to Amazon and buy a flatscreen TV for $800 with a credit (Can also use a debit card, that isn't 'credit' but its still just a piece of plastic) card and then buy the exact same TV for $800 using 7.6 BitCoins? I spent the same amount on both TVs I just used BTC funds for one instead of actual money out of my bank or from my credit line.

Dollars, Euros, Rupee, any type of currency can be used as investment, buying, selling and commerce, just like BitCoin, so I am not really sure what you mean by that.

It is a relatively new currency, so it stands to reason not many places will accept it yet but as it continues to grow (in terms of popularity) the amount of places it can be spent will increase also.

As for your comment about it being used for investment and not commerce, that just doesn't ring true, any time someone purchases BTC, trades BTC, buys a physical or virtual good with them, they are using it for purposes of 'commerce'.

L-Pink

That would fall under bartering laws which I don't follow.

I'm NOT trying to be a dick. I'm not anti bitcoin. There are tax consequences that people should be aware of is MY ONLY POINT! Paying them or not isn't my business. Just don't make uninformed decisions that can bite you in the ass.


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Agreed.

Unfortunately like most things in 'adult' the majority of GFY people see it as a tax less system of buying and selling goods and services... Just like Epass, Paxum, Paypal, et al... Even though it isn't

dyna mo

i didn't get that impression, that you were being a dick....... but i am also familiar with your postings/comments in btc threads and understand where you are coming from.

L-Pink

You're missing the point. Did you pay tax on the $800? Should have at some point so you are using after tax money.

On the bitcoin was a tax paid on the gain in value before it was used? Probably not and that is what I'm talking about.

Trading a bitcoin you have profit in is a taxable transaction on that profit.

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L-Pink

lol, very true. There just shouldn't be a company here telling people to use bitcoins and not pay taxes on gains.


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BlackCrayon

no you can't because amazon doesn't accept bitcoins but what does that have to do with anything? my point was credit isn't an actual persons money. its a debt backed by a billion dollar company. i can't wait for the day when i can buy a bag of chips for .00004529823232232 bitcoins. that's convenience.
obviously but its not its main purpose. with bitcoin most people own them because they think they are going to make money off them. i am not working for dollars in hopes my dollars will be worth more one day. see the difference?
if the government ever releases its own virtual currency (and they would be smart to do so) then i think bitcoin will remain in the dark corners of the web and not become mainstream. canada is already working on a virtual currency.
mhmmm... you knew what i meant.

__________________
you don't know you're wearing a leash if you sit by the peg all day..

helterskelter808

My point is simply this: if you're going to tell someone they are wrong, you have to do better than simply, "you are wrong". And when asked 'why?', you have to do better than, "look it up". And I don't want to argue about it either.

What are the advantages of bitcoins over currency and payment systems that already exist (dollars, credit cards and Paypal)? For Bitcoin to get any traction there needs to be a good reason for people (normal, average people, who don't give a rat's ass about its 'protocols' or what a technical marvel it is) to use it. If it's taxable and it's not anonymous, and it has a mountain to climb in being accepted anywhere, what is the (non ideological) reason to use it?

Not just for you, holograph is welcome to answer too, if he likes.

I'm not even against Bitcoin, I just don't think it will go anywhere, and think has no real, significant use other than as a commodity on the exchanges.

facialfreak

The main thing you negate to mention, is that household furnishings, and stocks and bonds are purchased with fiat currency. Bitcoin is an algorithm. Bitcoin is not legally a currency - by definition - until it is traded for a fiat currency.

OK ... so hypothetically, your neighbor has a lawn mower that is broken. You know how to fix it, and you do so. Your neighbor in appreciation for your fixing his mower, agrees to mow your lawn 3 times .... are you honestly telling me that you pay taxes on that exchange of services? C'mon man!

People talk a big game from the protection of their keyboards, but thus far all you have done is tried to defame my company.

Unless you can back up your claims, that you have proof of any tax evading activities, I suggest it is not in anybody's interests to be making unfounded accusations against fellow board members.

Cheers!

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dyna mo

the value of bitcoin is it proves the concept works. people will embrace digital currency. purely digital transactions can be made without middlemen or paper changing hands. people agree that it has value as a currency and agree to establish that value often.

bitcoin has also revealed some issues in cryptocurrency concept, namely, that mining btc isn't going to work. it also has been shown to not be truly anon as the block chain can be dug into to retrieve transaction records.

bitcoin is not going to be the crypto currency of choice, it will fail, die, end, whatever.

but the proof will remain.

at least that's my take on it.

facialfreak

THis is the problem .... I am not promoting it as a TAXLESS system of exchange .... as I will (or at least my company will) be paying taxes on the value of the exchange to fiat currency.

My offer is not really any different than a BIG BOX store that has a WE'LL PAY THE TAXES promotion ...

If you spend your bitcoin for my services, YOU will not be paying taxes on the same, because my company will be the one converting its value to cash, and will be responsible for the taxes.

I'm still at a total loss where there is any wrong-doings on anybody's part??

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BlackCrayon

uh, how do you think most people get bitcoins in the first place? they use fiat currency to purchase them.
that's quite the extreme example but think about this. herman bought 1400 bitcoins for 3 bucks each way back. now they're worth $130 or whatever each. herman buys goods and services with his now valuable bitcoins. should herman not have to pay any kind of taxes on gain in value he got from the bitcoins?
calm down, no one is trying to 'defame' your company. and in case you haven't noticed 80% of the posts on this board are people making unfounded accusations against fellow board members.

__________________
you don't know you're wearing a leash if you sit by the peg all day..

dyna mo

also, just as important, the exchanges were never part of the development of bitcoin.

they emerged later, to fill a need to cash out, etc. and they are truly the weak link. mtgox, for instance, fell into the #1 spot by pure luck, they already had the functionality as they were the exchanger for the online game

MagicTheGatheringOnlineeXchange = MTGOX

and that is exactly where the big problems lie.

L-Pink

"If you need somewhere to spend your bitcoins ... so you do not have to convert them into fiat, and thus you do not owe any taxes on them …."

The above is what you posted. You state that if a customer trades bitcoins for your product the customer owes no tax on his bitcoins. That is incorrect.

The bitcoin is an asset that for most increased dramatically in value. Any of the profit on the bitcoin is subject to taxation. If I have a bitcoin I mined at $7 and give it to your company for $100 worth of product I owe taxes on the $93 gain.

How does purchasing from your company allow the customer not to pay taxes on his $93 gain? "Mr IRS auditor I bought something for $7 and traded it for $100 but don't owe taxes" That is what you said.


As far as your company paying taxes on the bitcoin how can you pay for someone else's gain? Your value is now set at whatever the price was for the product you traded it for.


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I wont end up paying tax on it until the end of the year... It still goes into accounting though.

L-Pink

Correct. End of year or quarterly depending on your situation. But unfortunately there is a tax due on anything that turns a profit.

Telling someone to buy hosting with bitcoins and to forget about taxes on any gains is poor advise.

helterskelter808

Oh, okay. Thanks. Now I understand what you meant by proof of concept. I thought you were specifically relating it to Bitcoin (as other people seem to do), rather than the concept being used for other currencies.

I also believe the concept, or at least similar concept, will be used somehow in the future, but I probably thought that anyway, long before Bitcoin. I mean cyber currencies are not a new idea, it's just the implementation that's different in this case.

I don't believe it will spring out of 'the underground' though, and it will be the usual suspects who create and control it.

DWB

Bookmarking and will revisit in 2 years.

Dead

Still loving the BTC! Simply because on paper, I have no gains nor any losses....but damn, I have enjoyed the benefits of being anonymous with my trades and gains. Fuck cashing out, it is better to play with the profit until the day it is required by law to bring it to light. DWB and L Pink you really need to take a look at how this could benefit you. You would be amazed!

DWB

L Pink has to go first.

TheSquealer

Neither is an apartment. An apartment is not a currency. However, if I hire you and include free housing, that becomes taxable compensation to you. Taxes don't solely revolve around "profits" in the form of cash.

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Rochard

Dead

Ladies and Gentleman,
Welcome to the Wild Wild West!
Sure be a good upstanding citizen and claim every spec of gold you pull from your claim, we do appreciate that, and require this by law.
To the outlaws that are doing trade with others that will most likely do the same, we will get you, Cause we are a very efficient branch of government that will not tolerate those kind of shenanigans!

Give me a break!!!! Those asshats have more to worry about then some made up cyber currency, have you seen the spin on the local channel?. Let me rephrase this, until the feds get their shit together, I will do everything at my disposal, to take advantage of the system as much as the base line is capable of.
The whole thing is broke, lets not feed the machine any more then We see fit.

L-Pink

I'm not an IRS agent and personally don't give a fuck what people do or don't do on their personal taxes any more than I care what drugs they take. The only points I'm trying to make are don't be ignorant of existing laws. Make informed decisions aware of the facts.

The IRS doesn't take "oops my bad, I didn't know" as an excuse.

Bitcoins while new still fall under existing tax laws regarding profit on assets. Having a business come here and falsely say profit earned isn't taxable if they pay by bitcoin is foolish. Always know the law but obey it at your informed discretion.

Personally ??.. I'm pissed I didn't load up when they were cheap and envious of those that did. Then again I didn't buy microsoft or google at their lows either.


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Dead

As a company, not sure I would blend the waters of BTC and the great ol' USD , matter of fact, was advised not to.
I see your point and will raise you a fuckin great opportunity!
The ship has not sailed, you have a chance to still benefit from an amazing occurrence that has been presented to break the rules a little with out strait up tax evasion.
I just gave those fucks 20 gs last year and realized I over payed for any benefit I will ever receive in this future or any other portrait they show......

I will never again be fooled by this administration or the minions put in place to uphold their dream, or believe that doing the "right" thing is the way. They break every one of the rules, and we pay, sic?

Savvy will win this race, I am still learning the way as well....

Find your wind, and sail......fast and far, the water is great!

dyna mo

The big bubble is coming. Especially considering the current state of affairs with govs. A big natural disaster even can cause a run. Dont let a number like $1000 be a sueprise. A lot of decimal places to divide a btc for purchase.

PhoneSexKing

Lol.. you guys argue about Bitcoin like it is a religion - It's not.

It's a payment system, and the value in it is its ability to communicate value at a distance using a distributed ledger.

The tax laws in every country are so complex that I'm sure that everyone is filing incorrectly anyway. Just do what your accountant/you think is best and fucking move on.

The tax argument is a waste of your life.

clickhappy

I live in silicon valley and go to technical networking events all the time, almost daily. I havent heard 1 thing about Bitcoin. Theres not 1 lecture on it, not 1 Billboard, not 1 advertisement, not 1 sponsorship from a company who wants to get in on it...nothing.

If it were going to be a bid deal I would hear *something* about it by now. So it seems like no one who matters gives a shit about them or knows what it even is.

PhoneSexKing

Silicon valley was moved to China. Didn't you get the memo?

dyna mo

Bitcoin Companies Attract Frenzy Of Venture Funding
http://www.huffingtonpost.com/2013/0...n_3368035.html

Bitcoin finds investors, geeks, politics at Silicon Valley event

The event is small by Silicon Valley standards, with about 1000 attendees expected and 19 exhibitors, but it's bustling with startups launching new exchanges, software developers looking to strengthen the Bitcoin network, and venture capitalists seeking places to invest.

There's now $45 million a day being traded on the Bitcoin network, or $16 billion a year, according to Peter Vessenes, chairman of the Bitcoin Foundation, who talked at the start of the event in San Jose.
http://www.pcworld.com/article/20391...onference.html

silicon valley biz journal:
http://www.bizjournals.com/sanjose/n....html?page=all


several btc start-ups in the valley as well, such as coinlabs, silicon valley bank in fact is partnered with mtgox.

here's more via a goog search for silicon valley bitcoin
https://www.google.com/webhp?sourcei...w=1600&bih=775

here's a lot more from a goog search for venture capital bitcoin
https://www.google.com/webhp?sourcei...w=1600&bih=775

dyna mo

google matters right? or no??


Google Ventures chip into Bitcoins with investment
http://www.bizjournals.com/sanjose/n...chip-into.html

dyna mo

shit, i hadn't realized andreeson invested! that is nutty


Venture Investors Pour in Millions

a $5 million investment in San Francisco-based Coinbase led by Twitter Inc. investor Union Square Ventures.

$2 million put into OpenCoin Inc., another virtual currency startup whose backers include venture firm Andreessen Horowitz.

Jeremy Liew, a partner with Lightspeed Venture Partners, which has invested in three virtual currency startups including OpenCoin, said he's "incredibly bullish" because it allows for cost-free micro-transactions—such as buying a single candy bar—that would be too small for other electronic payments.

"The appeal of zero transaction costs is really strong and extremely disruptive for a massive industry, the payments industry," he said.

Chi-Hua Chien, a general partner at venture firm Kleiner Perkins Caufield & Byers who found the Facebook FB +0.78% investment while previously working at Accel Partners, said his firm is actively exploring investments related to Bitcoin and has already looked at more than two dozen such companies.

Mr. Chien estimates almost 100 companies are operating in the Bitcoin domain, including exchanges, payment processors and Bitcoin ATM machine operators. "It is completely crazy that money is not borderless," he said. "This is super-logical."

http://online.wsj.com/article/SB1000...375269952.html

Serge Litehead

How would you peg $7 to your mined bitcoin?

is it by time-stamp when it hit your wallet or when it was actually mined (issued) to a mining pool where you mine, or few milliseconds later when pool assigned it to your account?

That's rhetoric, an actual question is: when does any particular, mined bitcoin get their value? would it be safe to assume that bitcoins kept in storage before being used in actual transactions are valueless or unassigned? - reason being that no exchange of values have had happened yet and its value is undetermined. - does it make sense?

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ilnjscb

Bitboys, they can and will get you at any time. If the IRS wants you, they will get you. If they seize, you will go down and not get back up. They have thousands of laws to choose from, they can monitor everything you do, and they have sympathetic courts.

Anti-bitters, virtual currency is going to happen. It may not be bitcoin, but in a world with no escape this disruption will be more than economics. Look above - the posts are about freedom and emotion. Early adopters, outsiders, this is as much a social movement as it is a "currency".

Both sides will have victories and losses. Best hedge your bets and be in the middle. Enable, take fees, and pay taxes on those fees.

BlackCrayon

only a very small % of people are mining them these days, people mostly buy them. you should know that. you could argue for those who are mining that when the coin is mined, at that current point it the value is has is whatever the coins are selling for currently. what do they do with gold when they mine that? does it have no worth when its pulled out of the ground? only when its finally sold?

__________________
you don't know you're wearing a leash if you sit by the peg all day..

- Jesus Christ -

Only because collectively people like you say shit like this.
Men in robes only have power becasue you are a coward.


http://www.literature.org/authors/po...-pendulum.html

__________________

Amen

ilnjscb

Ouch - I'm an internet coward! Ok, usually the insults come out when someone starts losing.

Jesus, the men in robes have power because the men with guns back them up. There are millions of men with guns. Judges can set aside popular votes, Jesus. And petty power attracts certain people. You of all people should know this, Jesus.

So we agree about judges ... about the coward thing, not so much. I'm confused what any of this has to do with bitcoins.

DWB

Says a keyboard warrior named Jesus who ironically wore a robe.

That said, I've been looking for photos of you on the streets throwing Molotov cocktails, but I can't find any. So keep on trollin'!

TheSquealer

That same idiotic question and can be asked of anything of value that is bought, sold, traded/bartered and so on. You can pose hypotheticals until you fall over and die. Obviously there are many interesting questions, but that doesn't change the fact that... these questions have already been answered time and time and time again, both in the courts and in the Internal Revenue Codes.

The IRS does not need a new section to the internal revenue codes to clarify this for anyone as L-Pink keeps pointing out. All they have to do is say you owe money. Its that fucking simple., "how...this".. "how that..."... "how the other thing" is 100% irrelevant when they show up at the door announcing your delinquent taxes based on their own assessment of what the value was, what you earned, what taxes are due, what the penalties will be and so on.

All the immature kids and social retards on this forum simply don't get that in the USA as with most western countries, tax authorities let you know what you owe, if you fail to do so. It is that simple. Once you've crossed that line, ... once that threshhold is passed... the burden of proof IS ON YOU... not the IRS... and it can cost you dearly. I understand though that all the GFY millionaires think they can just go to trial with the IRS and their army of 1000.00/hr attorneys and get their own childish way.

__________________
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Yes, fewer illegal immigrants working equates to more job opportunities for American citizens.

Rochard