When I file for taxes on crypto gains, do I only file net profit or do I need to count profit on every trade?
For example, lets say I bought an initial investment $1000 BTC and sold for at a loss for $700. Then I bough back in with the $700 and made $1200, bringing my portfolio's worth to $2000.
Do I report that I made $1000 trading crypto or $1300? Does it work the same way if it were different coins, like if my initial losing investment was ETH and my reinvestment was BTC?
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You don't have to report any of that shit. Nobody cares, those are pathetically small numbers.
In the US, profit and loss on every trade. Other countries, net profit.
Those are just example numbers I made up to make it easy.
how would they track that? whats to stop me from only reporting the final btc to fiat cashout?
Remember when you got verified on an exchange with your motherfucking identification card and passport?
IRS has you by the balls.
An audit of your assets. How do you like the IRS's thick veiny cock?
Fact is, if you report crypto earnings, you're almost guaranteed to be audited which means you better have your shit straight. If you've ever bank wired to an exchange they already know what's up. If you don't want to report earnings, use localbitcoin, bittrex, a proxy, and keep it all in cash.
Where to find porn of this?
>using bittrex, a us based exchange
Fucking kek. I cash out by sending my btc to my family in a foreign country, having them sell for cash and then send me an atm card which allows me to take it out of their bank account here.
Anyone not doing that is stupid.
So am I fucked if I made a bunch of $2 dollar trades just to test the waters?
I wired about 5k from my bank account to coinbase like 5 months ago. I turned it into like 30k but only ever withdrew 10k back to the bank. The money was sitting on gdax for a while and now it's in other small exchanges that I never verified. I've literally made hundreds of transactions. Am I fucked? Say my total earnings for the end of the year is 50k. Can I just send them 15k cash without all the transaction logs and tell them to fuck off? Can I hide it? What do
would like an answer too
i bought btc on coinbase and then fired it off to other exchanges, so if i send btc back to coinbase to cash out, how would they track all the trades in between? places like etherdelta and liqui dont have my info
rooshvforum.com
Only pay taxes when cashing out to fiat
Flip/daytrade/margin-trade all you want, do it for over a year and you have to pay 20% max.
Disclaimer: This is not legal advice, I don't know what the fuck I'm talking about.
They'd see you brought more BTC back than you sent and ask how you got the additional BTC.
>reporting crypto gains to the tax cunts
Those number are too low to bother. For several thousand dollars, but silver and/or gold online somewhere that takes Bitcoin. Purchases under $10,000 aren't filed with the tax cunt losers.
Just hire a professional to do your taxes for you. It's not that expensive or a big a deal.
Exchanges will let you download a spreadsheet of all your transactions. Give it to them and they'll do some Excel Macro magic in it and they'll figure it out quick.
>Fact is, if you report crypto earnings, you're almost guaranteed to be audited which means you better have your shit straight
wtf are you talking about, you literally have no fucking clue what "gaurantees an audit"
>cashing out
>shiggydiggy
every exchange makes it simple AF to D/L every single transaction, its literally nothing user.
bitcoin.tax has import for pretty much every exchange.
it will import and do the math.
What people don't get is EVERYONE gets audited, computers go through everyone's return and look for red flags. If your crypto returns look in the clear, odds are good they won't even bat an eye, they don't have time to look for how you made money just whether it adds up right.
>file all your taxes correctly, pay every penny you owe
>but intentionally make it look really confusing and complicated
>trigger an audit for the lulz
>waste IRS time
>???????
>PROFIT
protip: government loves wasting time, you aren't hurting them
IRS has nothing but time...
i get it user, every return gets run through the machine and its anyones guess what the algo's are looking for.
who knows, maybe this year they will be looking for crypto, or probably not.
even with all the money going in, its fucking nothing compared to the economy itself, literally not even a fucking rounding error.
time will come though when the irs will really be looking...
hmm in that case maybe they'll have fun and we can be friends!
for D-A-CH
IRS is understaffed.... nothing guarantees an audit. They've got hundreds of millions of returns a year. Some people screw with their taxes their whole life and never get caught.
...
>rooshvforum.com
I like what they are saying but not convinced in the slightest that they are correct.
in 5 years when they are able to easily and cheaply track everything, if they see you've been cheating them, they will call every single one of those chickens back home to roost
I've been reporting everything for 3 years, have no been audited any of those years. all my shit is kosher too.
>I've been reporting everything for 3 years, have no been audited any of those years. all my shit is kosher too.
how are you doing it user? do you do each trade as taxable, or only when you turn it back to dollars?
What information do you exactly provide, and in what format?
Net only dw
That's gonna suck for me. I like to mess with bots by filling order book with 50 buy orders for 0.01 coins then I'll fill the sell side the same.
every trade is taxable. given the fact you are trading to make a profit, that makes you a "professional" trader in the eyes of the IRS and there is no skirting around your altcoin trades with 1031 like kind exchanges (which actually would be a massive red flag for audit).
I enter all my trades into quicken and keep track of USD values at every transaction. report cost basis, amount of shares, sale date, net proceeds just like any other capital asset sale. form 8949.
>I enter all my trades into quicken and keep track of USD values at every transaction. report cost basis, amount of shares, sale date, net proceeds just like any other capital asset sale. form 8949.
so exactly as if trading stocks.
This was my understanding of what was the correct way to do it but I keep seeing people say "like kind" and other such arguments that just don't sound right to me...
Like kind would be simple, but sites allow import of your trades that automate all the stuff make it a non issue to track honestly...
yes, except it's a capital asset not a security which means you don't have to worry about wash sales and stuff. for the time being.
Wait, there's a site or program where you can import all your trades?
Where? How tf would that even work?
>hodl here
bitcoin.tax
most exchanges allow you to easily export your trades.
that site will suck them in and do the math.
>Like kind would be simple, but sites allow import of your trades that automate all the stuff make it a non issue to track honestly...
it's not. a 1031 like kind exchange is not for traders trying to speculate on shitcoins, it's for property exchanges. and you still need to record the initial cost basis and purchase dates and need to keep records of every exchange/transaction. if you are seriously considering this route (ie: to avoid short term tax rate or something), then you need to hire a tax attorney and get opinion letters from them on the transactions. odds are it won't work regardless though.
I made trades in 2013 and owe about $100 taxes. I also have hundreds of dollars in 2014-2016 that I didn't report. What are the consequences of reporting late?
I meant hundreds of dollars in LOSSES* in 2014-2016. But then this year I have hundreds of thousands in gains so I can't not report.
>profit and loss on every trade
>net profit
Don't they total to the same amount? What's the point of reporting every trade?
>yes, except it's a capital asset not a security which means you don't have to worry about wash sales and stuff. for the time being.
thanks user. I have never actually done anything but buy a small amount of crypto before 2017, some of which was eth which exploded.
I have since traded some of that eth for other shitcoins(huge mistake largely).
At least now, things are back above water, it occurs to me that i have traded about 100 eth that I was up 20x on, and then some of those things tanked, so the net of it really sucks, paying tax on a huge gain + the loss of value...
Will be working with accountant who has done my taxes for years, I haven't asked him about his familiarity so this conversation is very helpful
keep in mind if your gains are high enough you may owe estimated taxes quarterly. I'm not looking forward to writing a check for $4k at the end of the month, due 9/15 for Q3. I claim zero on all my W-2 income buy no tax refund for me this year thanks to cryptos.
Don't believe him. There are professional CPAs saying you don't have to tax every trade, not sure what their excuse is. According to the IRS cryptos are PROPERTY, not stocks.
The situation is muddy, why pay taxes you don't have to? If they audit you just claim ignorance, and you'll just have to pay back taxes plus a little bit of interest. Reality is they'll probably never catch up with you.
Late fees.
>The situation is muddy
this is why smart money is paying tax on every trade. do you think the IRS is just going to let the public make literal millions on ETH, bitcoin, and the rest of the shitcoins that have mooned this year without paying a dime on all the trades in between fiat? that's absolutely, completely absurd.
IF, and this is a big IF you are clearing tens of thousands or millions a month, then you won't be getting advice on this from biz. you'd be listening to your very expensive tax attorney on the best case for your own situation. everyone on biz should be paying taxes for every trade.
Well in most countries they won't investigate anything below $10000 given the investigation costs more than that.
440 € im JAHR?? Tschüss Deutschland, brb.
Was ist denn, wenn ich mit BTC direkt Güter kaufe, mithilfe irgendeiner Kreditkarte, falls es sowas in DE überhaupt gibt? Ist das dann steuerfrei (außer Mehrwertsteuer)?
Thank you dude!
Shit, I feel like imma start delving into day trading now... lambo bois!
Does coinbase? Or is it not really an exchange
Does trading stuff reset capital gains counter?
>buy some BTC
>trade it back and forth between various cryptos over a few years
>trade back into BTC
>sell BTC
Is this long-term since the cryptos were held for over a year, or short-term since it didn't remain in any one crypto for over a year?
Same with other stuff, say you buy a house, then trade it 8 months later for a different house, then sell that house 8 months later. Is it short-term since each house was held less than a year or long-term since no USD was involved intil after more than a year?
>tried out daytrading
>forgot to record my trades
>just fucking deleted all my recorded trades and started over by entering the numbers I currently hold instead
How fucked am I if I cash out
Net..
itt: IRS cucks
Scared the IRS will take their NEO.
Are amerifats this pathetic?
Who's that semen demon?
I have a question. I bought 300 eth on GDAX about 6 grand worth in march.
I sold 85k worth of it into my bank account and the other 6k I switched to Litecoin without withdrawing to my bank.
Do I only pay taxes on the 85k?
You pay tax for both
If you buy 3L milk for at a price of 20$ for 1L (i.e. if you spend 60$) and it rises to 21$ and you then sell all your milk for honey, you get 3$ worth of honey more than if you had keept your 60$ and you not had speculated with milk.
This gain is taxed.
In other words,
gain = (sell price) - (buy price)
and you'll pay some percentage of that advance to the government
I thought it's not taxable until it's cashed out to fiat. The 6 grand hasn't been converted to fiat yet. I switched it from ETH to USDT to LTC. Only the 85 grand is in my bank account.
Pay on 85k now, record the 6k transaction and pay on it only after cashing out
This is not legal advice, that's just my understanding based on things people post on the internet
This, but.
You're required to report every trade, however generally the result is just going to work out the same, you made $300 capital loss which offsets that $300 of capital gain.
As above, no one will fucking care about that pajeet money and merely pretending to be a retard should be enough to keep you out of trouble if it came to question time.
The main problem I see for anons down the road, which could easily apply to yourself OP, is when they catch rockets and get some good momentum going but still choose to ignore the tax issue. Rather than working to position themselves for the most favorable tax outcome they do nothing, when push comes to shove it will be too late to do anything and they will be open to the very unfavorable outcomes at the taxmans disposal.
It seems to be largely misunderstood that the man will be in no way interested in the false logic of a young cuck, and is in fact able to ass fuck with impunity, he will literally take your money and you will struggle to get back anywhere near a fair amount, no amounts of b-bu-bu will penetrate his ice heart, you will become wojak.
He is well fucking aware of our little scam, institutional investors are no longer ignoring it, the tax office sure as shit won't be either and will at this very moment be stroking his erection at the thought of the very public ass fucking he will impose on us, whilst at the same time shedding the salted tears of regret only the norman nocoiner can know. This is an extremely dangerous combination anons, be afraid, have a plan and be careful, I will see you all on the moon.
This is wrong, but you can apply for like kind treatment, there is a 3 page document you can complete for each and every trade to request this. Yet to see confirmation it has been granted to anyone.
The IRS literally has a page on their website that answers digital currency tax questions. It doesn't count as like-kind exchange. It's treated as Capital Gains or Capital Loss. There's no debating this.
Exactly, I don't get how this is ambiguous or debatable...
So... How the hell do losses work?
Maybe I mined those BTC
for the most part, I like your colorful language
if this is a possibility, then what's the big fuss?
How much would one of these professionals cost you though?
Sollte nicht sein, nein.
BTC is voletil als nebeneffect. Wenn's das nicht wäre würdest du es nur als Zahlungsmittel verwenden. Nun machst du extra Gewinn und der Fiskus will nen Anteil von deinem Glück.
Btw. in D ist the Freigrenze 600€, die 440€ since in Ö
Aber sei froh, die Amis zahlen auch 15% nach 1 Jahr halten
Yet i've seen people claim they've never recorded their alt trades only the fiat-in for BTC and fiat-out selling BTC, how do they get away with it?
They get away with it because no one gives a shit about crypto, right now. Also, they probably haven't sold back into USD to their bank account.