I am an American citizen. I buy 1 BTC with USD transferred from bank to coinbase. I sell on CB 1 BTC into x ETH...

Z= Tr([BTCsubSell - 10000]+[ETHsubSell-BTCsubSell])

Where Tr = Tax rate for your income bracket.

Dude, look at my answer. This is how it works. You pay taxes only on gains and losses get deducted. The problem is that you pay on every crypto/crypto trade, but have to pay the taxes in USD.

>Buy 0.5 BTC at 10k
>Sell for 1 ETH at 1k when BTC at 20k -> Taxes on 5k gain
>Sell 1 ETH for LTC when ETH at $500 -> $500 loss
>Have to pay taxes on $4.5k

Have fun calculating this shit when you don't know the theoretical USD value of your coins at the time and just use a tool like cointracking or find some way to circumvent taxes.

$0, because you haven't cashed out. New buys are deducted from any imaginary gains as expenses. $10,000 + ($10,000) = no tribute for Israel. Now gas yourself, kike.
>it's the hourly "jews lying about taxes" thread

IRS has labeled any transaction, even crypto to crypto, as a taxable event. any profit from that is taxed at 50%. can you please go back to sucking your own dick and let the men talk?

It's as if you went BTC > USD > ETH... you need to know what the price of BTC was in USD at the time of trade.

>>Have to pay taxes on theoretical gain between BTC buy price in USD and BTC sell price in USD
No, you don't, you fucking kike.
>the jews literally cannot tell the truth

IRS Notice 2014-21 says hi.

A "taxable event" doesn't mean you pay taxes on it as figured immediately at that second in the transaction, you worthless oven-dodging kike. "Selling" $1000 worth of ETH to "buy" $1000 worth of DOGE means you haven't gained all of dick or shit. If you're actually following your trades that closely you've just lost 0.02% or whatever your exchange fees are for that transaction, meaning Israel owes YOU on that trade. There have been no gains.

Now fuck off back to your oven, jew.

say you buy $900 worth of bitcoin and it goes up to buy $1000 worth of etherium. You make $100 and you pay a tax of %50 on that $100 so you pay $50 on that.

Or in your context, you buy $900 worth of etherium and it goes up to $1000 so you buy $1000 worth of DOGE, you have to pay a %50 tax on those profits.

What is so hard about this for people?

completely new to taxes, but the deduction makes the rape a little easier

You're assuming your cost basis of ETH was $1000. Most of us try to buy low and sell high instead of selling at the same price all the time.

I thought it was 39%

>every example is a BTC to taxable services or BTC to cash-out fiat transaction
It causes a jew physical pain to tell the truth.

>"Selling" $1000 worth of ETH to "buy" $1000 worth of DOGE means you haven't gained all of dick or shit
This is true if you paid $1000 for that ETH to begin with. If you paid more, then you can deduct the difference as a loss. If you paid less, then the difference is taxable, since you're "selling" the ETH for other property worth more than your cost basis.

it's taxed under short term capital gains tax which is 50%

>Q–1: How is virtual currency treated for federal tax purposes?
>A–1: For federal tax purposes, virtual currency is treated as property.

>Q–6: Does a taxpayer have gain or loss upon an exchange of virtual currency for other property?
>A-6: Yes.

you can only deduct up to $3500 worth of losses in a tax period

You didn't "make" anything because you just rolled that money into a new expenditure, you ignorant fucking jew. How do you think a company like Amazon can have $140 Billion in yearly sales yet show not a goddamn dime of on-paper income? It's because your expenditures are deducted from your profits.

This is literally the most basic fucking part of accounting, yet you jews will still lie about it no matter how many times you get called on your kike shit.

Yeah since youre such a little faggot you should just give up and stay poor.

Ok let me get this straight, if you bought 1 Bitcoin for $1,000 and then after it appreciates you sell it for $10,000 worth of ETH. You're saying there's no capital gains on that transaction?

>dont pay taxes
>if they come looking for money they will have the number already calculated for you
ezpz

Your "gain" is immediately negated in the next fucking microsecond by your buying a new crypto. You don't "gain" anything if you just spent your gains on a new expense. There are no on-paper gains.

You kikes just refuse to give up.

>Israel owes YOU on that trade
kek

I don't know if you're stupid or stubborn, but I'm going to go for both.

also an idiot, they'll tax you on 100% of everything traded instead of profits made on the trades.

don't fuck with the IRS, they have the power to take everything you own. your are guilty until proven innocent with them

just hire a CPA, they can get your tax rate down to 5-10% using loopholes and deductions. It's money well spent, stop being idiots

No stop, you literally don't know how capital gains work.

Such a shill. Fuck off jew. I cant even tell if you are a larp or a true idiot.

>uses crypto
>sucks state cock

Thats my secret captain, I never make a profitable trade.

If you bought 1 bitcoin for $1,000 and after it appreciates you sell it for $10,000 worth of ETH, you just realized a $9,000 short term capital gain the moment you make the trade. You don't get to deduct the price of the ETH from that.

Buy high sell low brother!

This is only true if the exchange is considered like-kind. Bear in mind that the IRS is pretty particular about what counts as a like-kind exchange, and that the newest tax law that Republicans just passed explicitly clarifies that crypto-to-crypto trades are not.

Otherwise shit like this would be feasible:
>make500 million profit in stocks
>buy coke and hookers with 250mil of it in the same year
>only pay tax on 250 mil because you immediately lost any gain on the other 250mil when you bought hookers and coke

Right, and every single accountant I talked to wouldn't allow like-kind exchanges for crypto because they know that'll immediately throw up red flags.

You're confusing capital loss with "expenditure". You ACTUALLY don't get it.

>any profit from that is taxed at 50%
No it's not, short term cap gains are taxed at the same rate as income.

Capital gain or loss = FMV - Cost Basis

A tax payer realizes capital loss when the Cost Basis of the coin sold is greater than the FMV of the trade. Again if I bought Bitcoin for $1,000 and sold it for $10,000 worth of ETH. FMV = $10,000 , Cost Basis is $1,000. Capital gain is $9,000. The fact that the ETH cost $10,000 is NOT considered a deductible "expense".

Now if your ETH holdings declines to say $6,000 FMV and then you sold it, THEN you would realize a -$4000 capital loss which can subtract agains the previous capital gain of $9,000.

It's not "Jews tricking you" you simply are not high IQ enough to understand the difference between capital losses and expenses. The fact that the money is "rolled" into a new investment doesn't matter unless you can defer the capital gain as a like-kind expense. Which the consensus of all accountants I talked to say that it is inappropriate for crypto.

BASICALLY YOU ARE BEING STOLEN FROM. YEAH IT SUCKS. SEND A LETTER TO YOUR SENATOR IF YOU GIVE A SHIT. YOU WON'T.

I meant like-kind exchange* not like kind expense.

>invest $15k in crypto a while back
>worth $200k, cashed out $100k in 2017
>do taxes
>have over 2000 trades on binance, make sure to calculate how much I owe on a per trade basis
>end result: I owe $2,000,000

HOLY FUCK YOU LITEARLLY CAN'T WIN WITH CRYPTO

TAXED ON EVERY SINGLE TRADE AT THE PRICE IN USD, AT THE PRICE IN BTC, FOR EACH TOKEN OF THE ALTCOIN YOU HAVE AT THAT EXACT MINUTE OF THE DAY DOWN TO THE SECOND THAT THE TRADE WAS EXECUTED

IT'S ALL A PLOY YOU ARE GOING TO OWE THE US GOVERMENT 10x WHATEVER YOUR GAINS ARE IF YOU ARE IN ALTCOINS

NOOOOOOOOOOOO MOOOOOOOOOMMMMMMMMMYYYYYYYYYYYYYYYYYY

This is wrong also, you can deduct $3k of NET capital losses per year against all other income. You can deduct all gross capital losses against gross capital gains.

No, you got it wrong also.

you guys are all fucking retards and no matter how many threads are made, you still won't understand how simple fucking capital gains work.

/thread

Z=0
Crypto is untaxable.

>cointracking

Also, to answer your question, OP, z = 0 because as you described the situation, none of the prices changed. Therefore you made no gain (or loss) on the transactions, therefore you incur no tax liability.

>taxes
Nice try schlomo

Here is a simpler question. I mine one million shitcoins in 2017. The shitcoin moons to $1 and I sell it in exchange for $1 million worth of junkcoins, giving me a capital gain of nearly $1 million for 2017 minus any mining costs. In 2018 I try to sell the junkcoins for money to pay my taxes but junkcoin unexpectedly collapses to $0 before I can sell it for dollars. Do I still owe the IRS the capital gains taxes on $1 million from the shitcoin sale? Will the IRS forgive the taxes because the junkcoin I received for the shitcoin is no longer worth anything?

I'm not 100% sure if you owe capital gains tax on something you did not "purchase" (your mined shitcoins). But let's say you did buy those coins, instead of mining them. Yes you would still owe that tax on the $1m profit you made. It's your fault for not setting aside some of the profits for the tax liability.

u file capital losses

you can file for capital loss, but that capital loss can only offset your gain up to $3,000. The rest can carry over to future years.

Nigga

make a corporation

invest your USD or buttcoins into the corp (tax free) and buy your buttcoins or eth in the name of the company. now everything is tax free. you can freely convert between any coin you want

you now only pay capital gains once you remove the money from the corporation.

but why would you do that

employ yourself for a dollar and have state tax-less catering every day and a company car while still collecting welfare

Please tell me you don't believe the crypto-crypto lies.
You only pay on what you convert to fiat.
If you WANT to pay on crypto-crypto trades, the tax man wouldn't mind at all.
People talking about crypto-crypto taxes are being asinine and spreading rumors for normies to fall for
I guarantee you a fuck ton of people will pay more than their fair share because they believed them.

No, that's just what I'm doing personally. If they ask for my trade history they can sort it out themselves, otherwise I'm paying the difference on what was bought and taken out with fiat.
Good luck determining the precise price of "x" shitcoin at "x" moment in time in terms of Bitcoin, and then the USD value of Bitcoin at that present moment in time. Not realistic at all.

z = f(ud)

>It's your fault for not setting aside some of the profits for the tax liability.

But I did. You can substitute Tether or Bitcoin or Ethereum for the generic junkcoin in my example. Not all trading accounts have the ability to convert to dollars. Maybe I traded into "junkcoin" just to hold my money until I could upgrade my account to allow cash withdrawals. Here I traded my shitcoin into junkcoin because I thought it would be more stable only to have junkcoin become worthless due to unforeseen events (i.e. another ETH DAO debacle, BTC flippens to BCH or Tether just becomes worthless without explanation).

How do I use a 2018 loss in the 2017 tax year? The $1 million capital gain occurred in 2017 while the $1 million loss occurred in 2018 (if I sell the junkcoin in 2018).

Someone just please offer a reasonable way to avoid taxes

in that case you're shit out of luck. You incurred the tax liability the second you realized those profits. It's your responsibility to have that money owed to them in USD.

ITT: People not understanding taxes and thinking everyone who tells them the truth is full of shit. Looking forward to next year to be honest.

This is called "tax evasion" and it is also known as "fraud." You saying something doesn't make it the law lol.

If you get audited, which is highly unlikely (especially if you're not a high roller), then they will sort it out themselves and they'll fuck you in the ass for the money you owe them.

You just found the gigantic loop hole within the current system. I know people will tell me I'm wrong, but I can assure you this is 100% correct.
Yes, you owe taxes on the $1 million. Yes, you do not have that kind of money. Yes, you're fucked now. The good news is you have a 1 million loss for 2018 now, so you probably won't have to pay taxes this year. The bad news is you owe them around $400k. No, you cannot retroactively file capital losses. You are pretty much forced to cash out in 2018 to pay your 2019 taxes, or else you could lose everything AND owe the IRS taxes beyond belief.

It's these threads and the ignorance on full display in them which finally pushed me into finding a decent CPA. It's going to cost a thousand bucks to sort out years of shit and get assistance in the case of an audit. All these people claiming gains who can't protect themselves for so little are fools who will be separated from their money soon enough.

lol this

Funny since it’s 35%, so .350, so literally tree fiddy
>mfw Uncle Sam is a funny guy

Is there like a cutoff point where I won't get reported? Like Paypal's 20k for instance

THAT'S NOT EVEN REMOTELY TRUE SHUT THE FUCK UP FAGGOT AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA

>Looking forward to next year to be honest.
Why? You typically don't receive adjustment letters until 2 years later.

Short term cap gains are taxed as income it can be anywhere from 10% to 37%, there's no way to know this without knowing his total income.

>what is estimated in good faith
Make a reasonable and non-kike payment and guess who doesn’t get audited

Because that will be the first time people try to file their taxes. And when they come across the absurdity of the new 'system' - that's when biz will get really entertaining.

Exactly. Or mine. I’m 43 years young and have been juggling certified mail from the internal rectal scewers for years. Never sign, never answer any mail from the IRS. Ever. Pay your annual taxes, if you have questions talk to anyone but your HR Stacy. She is NOT your attorney.