The government and shit

If, God forbid, the CRA decides to audit me for my capital gains in crypto (Canadafag) will I need to show them the history for every trade I've made since converting my dollars to crypto?

bump

The website is doing the trading under their own agreement, you only pay taxes on the lump sum deposited in your bank account at the end. It weighs the same way with Robinhood.

USA member though, so i don't know how Canadian laws work.

This. The government doesn't care that you hold 18 million CumCoin, only that you cashed out for $14.83

Now see that doesn't make much sense, because what if I turn 1k into 10k with crypto, but I only cash out 500? I get to write off 500 as a capital loss now all of a sudden?

Also, let's say I buy 10k worth of crypto on Coinbase, send it to Polo and make it into 50k. Then I convert that to USDT on Polo and send that to my tether wallet. Then I send my tether wallet money right back to my bank.

Who's to say that 50k coming into my bank is the same as the 10k I took out? There's thousands of ways to make all that in between exchange completely untraceable, especially if I mix it up, send it to lots of shady sites, trade it all around, etc.

There is no way to check that. How the fuck is that explainable?

Note that in this case money goes into Coinbase but comes back to the bank from an unrelated website. Or even better, let's say I sell my BTC for cash and show up to the bank one day to deposit it.

How do they know it wasn't just a gift and I lost my BTC completely on some Russian exchange?

How does one turn usdt into usd.

I haven't found a way to turn tether into fiat without getting fucked.

That's not how trades work. By your logic you could put 1k into the stock market, turn it into 10k, cash out of only $500 and declare a loss. That's fraudulent and flat out wrong.

You have to look at the number of shares, or coins, you cashed out of. If you turn 1k into 10k and cash out $500, you will have to report the cost of buying however many coins you sold for $500. So let's say you buy 1,000,000 coins for 1k and it goes up in value to 10k. Paying 1k for 1,000,000 coins means you got 1000 coins for $1. If 1,000,000 coins are worth 10k now then 100 coins are now worth $1. If you cash out $500 you are selling 50,000 coins. The cost of buying those 50,000 coins was $50 so you have to report $450 profit.

Go to the tether website?
The homepage of tether? Sell them your tether and get the USD.

Ok good point.

What if I buy 10k BTC but cash out 50k ETH? Or rather, what if I convert it to USDT and cash out my USDT for USD on a website with no connection to Coinbase and no way to prove affiliation?

But let's say I turn 10k into 50k with crypto on some Russian exchange, then sell it for cash on Localbitcoins and deposit 14k per year in cash to my bank to avoid the gift tax. I don't see how that could be taxed.

You know what OP?

Sell your crypto for cold hard cash and then just buy everything with cash everywhere you go and nobody will fucking know.

There is no WAY this can be taxed, right?????

What if I bought Bitcoin when it was cheap intending to hold forever and now I run a business accepting Bitcoin payment that I sell for dollars?

You're just asking how to commit fraud now. Let me give you another similar scenario.

Let's say you buy 10k of stock A then tell your broker to sell A and buy B then you cash out of 50k worth of B. If the broker never reports any of this to the CRA (or IRS if you are American or whatever) then all they will know is 50k arrived in your bank account. That's the same thing you're trying to do with BTC and ETH.

In theory you need to report that you bought 10k of BTC and sold it for $x and pay taxes on that difference. Then you need to report that you bought $x of ETH and sold it for 50k and pay taxes on that difference.

Yes you can roll the dice and hope that the CRA/IRS/whatever hasn't caught up with crypto yet and claim your "gains" are really just non-taxable gifts. But that's you getting away with something, the proper reporting is still no different than trading stocks or any other instrument.

Tax is a unit we pay the federal reserve as a thanks for them letting us use their monitary system as currency. Most alt coin groups do not charge us for using their item as currency.

If you convert a non-expensed altcoin into expensed(taxed) USD or other countries currency, backed by a reserve that makes commission on usage of the currency; you pay that reserves commission charge on the use of their currency.

USD runners want 6 cents for every USD passed around. In return, they regulate items we can use to trade, so we don't fight over how many chickens a pig is worth.

>Tax is a unit we pay the federal reserve as a thanks for them letting us use their monitary system as currency

That's not what tax is at all. It's a payment for services rendered by the state. The fact that your money is held as crypto doesn't change anything, you are liable for tax on gains as long as you are a resident of a country like the US that charges tax.

I don't have money, i have crypto.

>tfw i don't need to worry about this since all my crypto trades are losses

I see your point but if you're like me and making tons of trades on many, many different exchanges every day, that kind of tracking becomes impossible.

And in your scenario you're still cashing in with a broker and presumably cashing out with them. I'm talking about buying in on Coinbase, trading around essentially thousands of trades over tons of websites, maybe some of which don't even exist after a few years, and then cashing out with Tether.to or cex.io or some other site that has no idea how much you bought in with.

I get your point that it's not supposed to be this way but for many reasons it just seems untraceable. I'm not sure what the IRS could legally do about it, especially if the deposit comes back to the bank in the form of a cash deposit. Are they going to claim every cash deposit is "probably" the taxable income from the crypto?

They might, I don't know. How, then, will they know I've realized my gains at all? How do they know it's not just separate cash?

It's completely unverifiable for thousands of reasons. Sure it may be fraud but I think if you mix it all up like that it's inevitable.

Continuing: if someone buys my crypto for USD, i will be required to pay taxes on the USD they give me.

I don't understand. Why not transfer the crypto to a wallet on your cellphone and withdraw cash from a bitcoin atm.

Wrong. That's double taxation.

I pay taxes on my income, then buy crypto with it. When someone then buys back my crypto, I don't pay taxation again, I (in theory) pay taxation on only the profit I made.

The problem is that it's completely impossible to differentiate selling a product and receiving a gift with crypto because by design the property rights of crypto are impossible to trace. This makes them virtually non-existent. You have no property rights over your crypto solely because, while you might own them in theory, there cannot ever, by design, be a way to prove it.

For this reason alone, it is not currently possible to tax cryptocurrencies and those who work to calculate crypto taxes and then pay them are providing unnecessary labor and capital.

To add: I think withdrawing cash is like a 5% charge. Unless you use localbitcoin to exchange in person

>cryptos are da way of the future
>No regulations!!!!!!!!! Buy now!!!!!
>O shit I got audited and owe thousands

Again, there are a thousand reasons why, short of you confessing, no such lawsuit could hold up in court. It is by design untraceable and there are a million provably viable and plausible explanations you could give to justify literally any amount of gains in crypto.