Tax implications for crypto

Discussion of all things crypto and blockchain.
silverpv
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Re: Tax implications for crypto

Postby silverpv » Mon Jun 11, 2018

Bucketeer wrote:
Long John wrote:
Bucketeer wrote:
silverpv wrote: I hear they are a bit busy trying to figure out what to do for 2018. It’s going to be interesting..


2017 will be a wash, 2018 will have regulations.

Now you tell me. :lol: I paid a fair bit of taxes on my 2017 crypto activity. It would be just my luck if the IRS wasn't really paying attention yet.


I paid more taxes than I deserved. Crypts are currency, not assets.

Seriously....if I move Bitcoin from my KeepKey to a softwallet in order to update the KeepKey firmware, is that really a transaction?

Where is John McAfee when you need him?

I'd hate to be a trader. Schedule D nightmares. HODL


If you're worried about multiple tx's, just get another keepkey as a backup. Upgrade the firmware on one and test your backups. You shouldn't have to move your funds if you have tested you backups. The funds are on blockchain, not on the device. If you have only 1 keepkey you run the risk on bad hardware or loss. Total prepper fundies, 2 is 1, 1 is none here.

As far as taxes, i'd rather make sure they don't come knocking on my door, pay the man. If they see i overpaid, i'm not on the list when they match me up with the coinbase/bittrex list.

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Bucketeer
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Re: Tax implications for crypto

Postby Bucketeer » Mon Jun 11, 2018

I'm not worried about multiple tax entries, but it's just about entering another Schedule D entry for recordkeeping. Good advice about getting another KeepKey. At least I'll get a 1099 from Coinbase next year.

What happened yesterday? A $1K drop? WTF??? Must have been Wall Street, HODLers aren't selling.
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Recluse
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Re: Tax implications for crypto

Postby Recluse » Mon Jun 11, 2018

Bucketeer wrote:
Seriously....if I move Bitcoin from my KeepKey to a softwallet in order to update the KeepKey firmware, is that really a transaction?


What convinced you that move is a reportable/taxable transaction? Everything that I read leads me to believe it is not.
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silverpv
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Re: Tax implications for crypto

Postby silverpv » Mon Jun 11, 2018

Recluse wrote:
Bucketeer wrote:
Seriously....if I move Bitcoin from my KeepKey to a softwallet in order to update the KeepKey firmware, is that really a transaction?


What convinced you that move is a reportable/taxable transaction? Everything that I read leads me to believe it is not.


When you send money out of a wallet, that currently is counted as a "sale" because the IRS doesn't know if you sold it or transferred it to yourself. When it hits the receiving wallet it counts as a "buy" since its incoming and should wash but you still get dinged for cap gains if you transfer wallet to wallet in less than 1 year. It's a little annoying right now, but that's the way its recorded currently.

Right now unless you do it manually, only you know what's yours since you're your own bank and have to report it yourself vs. the banks and companies that do it for you and send you a 1099. In current systems a wallet address is another bank account and since you are managing that account its your duty to report. There's no concept of multiple accounts under a single user in crypto. This is part of the complications of the space.

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Bucketeer
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Re: Tax implications for crypto

Postby Bucketeer » Mon Jun 11, 2018

Recluse wrote:
Bucketeer wrote:
Seriously....if I move Bitcoin from my KeepKey to a softwallet in order to update the KeepKey firmware, is that really a transaction?


What convinced you that move is a reportable/taxable transaction? Everything that I read leads me to believe it is not.


Schedule D rules and regs. Maybe I'm overdoing it, but I've done the IRS dance twice and don't want a 3'rd.
Gentlemen prefer Engelhard.

Recluse
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Re: Tax implications for crypto

Postby Recluse » Tue Jun 12, 2018

Bucketeer wrote:
Recluse wrote:
Bucketeer wrote:
Seriously....if I move Bitcoin from my KeepKey to a softwallet in order to update the KeepKey firmware, is that really a transaction?


What convinced you that move is a reportable/taxable transaction? Everything that I read leads me to believe it is not.


Schedule D rules and regs. Maybe I'm overdoing it, but I've done the IRS dance twice and don't want a 3'rd.


Can you point me to a source for these rules?
They make it clear that it is to be treated as property. I cannot find where the IRS has specified that a transfer of your property from one location to another and remains your property is a taxable event. I realize that Coinbase includes all transfers in their generated reports because you "may" be transferring your property to someone else. This is the most recent document from the IRS that I have found pertaining to cryptocurrencies. https://www.irs.gov/pub/irs-drop/n-14-21.pdf It doesn't mention the movement of your property thats remains your property.

At this time this does not affect me one way or another. I do think it is important to have a definitive answer because right now that transfer may result not only in a huge gain, but for some a huge loss. Incorrectly reporting a huge loss can be a pretty bad thing.
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Bucketeer
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Re: Tax implications for crypto

Postby Bucketeer » Wed Jun 13, 2018

Gentlemen prefer Engelhard.


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