Hi guys. i'm in deep shit

The IRS collects taxes illegally. Write them a letter and tell them to go fuck themselves and everything will be alright because they can't do anything about it.

How fucking stupid are you? Jesus fucking Christ did you consider googling “capital tax explained to people educated in Mississippi”?

you dont owe shit unless you cash out

Only crypto-to-crypto or crypto-to-anything-else is taxed. If you just bought some coins and held, and they've increased in value, you do not pay any taxes yet. You DO pay taxes, however, when you trade for anything else or cash out. This is accurate for US residents. Crypto day traders get pretty rekt, though.

Op what exchanges are you using? And are you fully verified?

If you are making your gains purely on offshore exchanges your chance of them cooperating with US gov is far less.

But even if you dont want to avoid claiming the gains what you could do is burn all your coins and say you were hacked in dec and lost control of your trading account and the hacker seized all your coins, effectively a full loss. Or you could sell and claim you sold in 2017 and lie your way through it. Scrub as much info as you can, delete accounts, delete wallets, lose keys, and say fuck it.

yeah my advice is investment money is for something expendable you know you can cover, so next time don't be stupid with your money

Thats not how it works LMAO

fucking retarded if you don't know how taxes work.

Just pay taxes on the final cash out and fuck everything else.

My dude I can help you out with this, easily. I'll keep your bill low for only a small fee

LONG TERM CAPITAL GAINS TAX FAGGOTS DO YOU SPEAK IT? 365 DAYS = LONG TERM TAX

No. It may affect the final tax bill when you DO cash out but it's offsettable by the losses. You have nothing to worry about.

This, im 5k in loss and will fucking tell the taxation office to go fuck themselves and send them my 10000 transaction log stating 5k loss.

What the fuck are they gonna do if there's nothing in your bank account? If they hit you with a big bill you can't afford, declare bankruptcy.

Op were you trading? Or just held coins the whole time? If you traded yeah you owe capital gains anytime you sold a coin. Best option is to just hold, and pray to kek that by the time April rolls around we have recovered some. Even then, you can put it off longer and file for an extension. How much do you owe?

This is the reason America is in the shitter. Citizens of the country don't even understand their own bureaucracy.

inb4 MUH PUBLIC SCHOOL EDUMACATION

i traded a quite a lot. enough to not afford capital gains on the trades.

...

So fucking retarded. You pay capital gains tax when you REALIZE GAINS. if your internet space money goes to 0 you owe zero, idiot.
if it goes to 1Milllion you owe the cap on that amount when you cash out. holy fuck why is this so fucking hard for people to understand. You can do the same thing if you are casually day trading, you pay taxes on the INCOME YOU EARN, so your initial investment is free of tax, but the profits you earn churning/pumping/moving your positions is what is taxed. No, you dont have to fucking sift through every trade you made on binance.

The Irs is not that fucking retarded. It's a pretty simple equation folks
Did your total amount of fiat/wealth increase? pay tax on that increase. Fuck you guys are retarded.

i thought crypto-crypto trades were taxable events.

also the longer you dont pay, they add interest which compounds daily. Pay your taxes go- err guy

AAAAAAAAAAAAAAAAAAAGH THAT DOESNT FUCKING MATTER!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

im jk op i'll be nice

so its actually pretty simple, if you are day-trading, and it accounts for more than 50% of your total income, then that is income tax
(in US which i assume u are in)
so pay based on your tax bracket.
if you're playing around here and there and moving positions actively but not all day, that's captial gains and it taxed as such.
The only thing that really matters is
did you make money? then pay your tax on it.
so if your btc is worth less than you traded it up to/bought it for you dont owe.

AAAHHAHAHAHAHA

reddit.com/r/Bitcoin/comments/1uccfz/i_am_a_tax_attorney_here_are_my_answers_to_the/
reddit.com/r/CryptoCurrency/comments/7m56g0/the_absolute_fucking_impossibility_of_reporting/

...

OP i'd like to thank you for your sacrifice because i didn't understand shit either. while all of the harsh posts apply to me too they aren't directly at me

damn that really sucks. you might want to hire a tax attorney and try to get him to sign off on a letter that let's you use the like-kind exemption, which could cut your tax bill in half. 2017 is still sort of a gray area so it could work

Holy shit that was legitimately funny. Thanks user

Posting in a brainlet thread

kik?

Umm. No.

Yes that apply when you cash out

can you cite that?

no it applies to every trade dumbass. stop spreading misinformation

I'm about in the same position, would have to liquidate whatever I have left to pay taxes and would end up in a pile of shit.

in the US, you can file for a tax extension. I'm not sure what the paperwork is, but it moves your payment date into the future. unfourtunatly this means that you'll have too pay even more next time around, but you have time for your assets to appreciate again. Unfourtunatly if you wind up with mostly short term gains from your assets because you haven't held for over a year, you pay capital gains tax again.

so if you start with 10k, make it to 90k, you own about 5k plus 25% of about 55k so about 19k in short term capital gains assuming that is your sole source of income, you then crash back to 10k at the start of the next year, meaning you now owe more that you have. you can extend a certain amount (idk exactly what).
just remember, that if your holdings then go back up to 90k, and they classify as short term gains again (because you've been trading)
you now have to pay the 19k back taxes, and another 19k for that years tax cycle. you can deduct realized losses at a rate of 3k per year, and extend losses into the future enabling you to deduct another 3k of losses each year until all realized losses are accounted for. however, that still sucks because if you realized 30k of net losses, that will take 10 years to get back from your taxes and that is assuming you never have another realized capital loss.

basically, it is out and out theft. you pay money, even if you never got to see a penny of real world profit, the IRS rapes you, and then tells you it will "forgive" your losses because you're such a worthless fuckup at a rate of 3k per year, so, too bad, serves you right for trying to become successful and putting money into a new market to spur a technological revolution.

of course I'm not a tax attorney, so don't take this as truth, but from what I've read this is what we're left with. consult an actual crypto tax attorney

Yes, but you only pay this on liquidation. If you don't cash out, you do not have to pay crypto to crypto trades, since you only make value, not actual realised gains you lemon. Value and gains are separate

cite your source

Why do I need a source to say gains and value are not the same Thing? Use your head

Realised gains, to clarify. That is what CGT is on

i dont even know how to respond to the ignorance of op or this thread.

you cant pay for what you never had dumbass. example 100k in btc- goes to 10k in btc. you don't owe 90k in btc that doesnt exist. you would end up paying cap gains for the 30%~ you eventually take out if its actually profit.

Funnily enough that's how it works in the Netherlands. You have to pay 1.2% of what you OWN valued at abstract prices.
Every time I see some Dutch user boasting that they pay 'only' 1.2% I laugh. Wealth tax is the worst possible tax in the world.

.t tax shill

You're not understanding this. Google unrealized gains tax. Try to find a single thing that says an unrealized gain for assets can be taxed.

It can only be taxed if you sell. Yes even crypto to crypto trades.

>be me
>invest 4.5k of my 5k life savings left over as a USA college fag
> make 50k total profit, but from trading, not from "le hodl meme"
>didn't cash out
>owe something in the range of 11k and 18k in taxes
>market divebombs
>left with total of 25k in crypto assets,
>fuck
and there are some people that were hit hard enough in the crash that they wound up with less than what they owed in taxes, now I get to deduct 3k capital losses for the next 10 years in order to get back the taxes I paid on the 50k that turned to 20k in a month, but who gives a shit because I either have to liquidate to pay taxes and miss the natural growth that comes after the bubble (like dot com) or file an extension and accumulate tax debt. long story short, I try to make money, don't actually make money guberment doesn't give a shit claims I am ow in debt to them even though I didn't actually make the amount they are claiming.

oh look another one sucked into the machine that is government and debt slavery. ironically enough, the whole reason he did any of this was a chance to give himself a head start in being a good little responsible citizen and attempting to become financially independent, which would give the government another nice dependable source of income to leech off of instead of those lower class shits that constantly default on their debt. so even though it's in the government's best interest for people to become financially independent and then comply with regulations and become a super dependable source of tax revenue, they say fuck that, he's probably another one of those irresponsible lower income leeches that's too stupid to do shit, so lets suck him dry while we can in order to minimize the assumed loss from him defaulting on later debt.

and thus we chug along

This larping is getting old

>you only pay this on liquidation
hahaha holy shit. i can't tell if you're trolling or if you genuinely believe this.

you owe taxes on crypto-to-crypto. period. there is no if or but. you're supposed to set aside money for taxes when you trade, sell, or buy anything with crypto

find me a source that says otherwise. i bet you can't because you're just pulling things out of your ass

maybe you can get away with claiming crypto to crypto is like kind and therefor unrealized, but that is standing on some thin ice there bud.
and that only counts up to 2017 if it counts at all.

so either pay taxes on all taxable events which means every trade of any kind, or try and weasel out with like kind trades and hope you don't get assfucked in an audit at some later dare.

either way, if you were trading the big cryptos like eth, ltc, btc and a few others, there a fair chance you were doing it with usd pairs so for the most traded pairs, you triggered taxable events with every fiat to crypto trade anyway,

the US criminaly assfucks people when it comes to crypto, and they do it out of their own sheer stupidity because they don't know what to classify crypto currency as so they classify it as whatever the fuck they want because who cares, it's only the taxpayer that gets shafted, not the government, and hey the ambiguity even works out in the government's favor because we get to collect more tax revenue on it YAY!

this is the actual situation I'm in, and I'm pissed

>invest a total of 14k last year july
>extremely shitty at trading and only manage to be up to 27k on jan 1st
>currently at 12800$
I have less money now than i did in august.
This crash is just going to make 1000s of people not pay their taxes
fuck the irs

here's a source that backs me up

cryptocurrencyfacts.com/2017/12/30/the-tax-rules-for-crypto-in-the-u-s-simplified/

>You don’t realize gains until you trade, use, or sell your crypto.
>You owe taxes when you sell, trade, or use forked coins or coins you mined.

OP here. this was the most useful info in the thread.

to everyone calling me a brainlet, fine, i am a brainlet. but the like-kind exchange argument is still complicated and seems to imply that whether a crypto-crypto trade is taxable depends on whether you trade a security token to a utility or vice versa.

regardless, crypto taxes are a fucking mess. i guess i will talk to an accountant, but i highly doubt they will be much help.

Think about the way this is phrased a minute. If I trade 1BTC when it was, lets say $10000 for 10000 ShitCoin, when ShitCoin's market value is 10000 ShitCoin for 1BTC (so each ShitCoin is $1) how much tax do I pay on this taxable event?

How much have I earned in value from that trade?

Guess what, fucking nothing. Crypto to crypto trades aren't taxable unless you pay above market price for whatever reason. If you use a reputable exchange, at the time, there was no value increase.

Why do people believe this? I thought the "gonna kill myself cuz taxes" was a meme

you aren't a brainlet, this a failure of government, not a failure of the individual to follow government regulations

using advanced techniques to study how easy it is to understand certain language (SMOG readability scores), american legislature, and the tax code were ranked at such a high difficulty of comprehension that only a very select few people intelligent people who study it intensively can understand it. combined with the profusion of codes and documentation around this subject and you are left with the only conclusion that a governing body perpetuated itself and grew large enough to obfuscate the codes by which it ran the country in it's own self interest of self perpetuation and growth.

I saw a good video explaining this obfuscation of language to get these 1000 page bills passed and some of the people they talked to admitted using it as a tool to get things passed that were favorable to whichever special interest lobbied harder or had deep enough pockets.

if you've seen bojak horseman, t's like in that episode where in order to pass a bill, a useless clause to build a bridge to hawaii was forced in by some special interest group. it's the same idea

because i traded. i was making trades at least every week. ultimately almost all of my profit is taxable.

>you aren't a brainlet, this a failure of government, not a failure of the individual to follow government regulations
>using advanced techniques to study how easy it is to understand certain language (SMOG readability scores), american legislature, and the tax code were ranked at such a high difficulty of comprehension that only a very select few people intelligent people who study it intensively can understand it. combined with the profusion of codes and documentation around this subject and you are left with the only conclusion that a governing body perpetuated itself and grew large enough to obfuscate the codes by which it ran the country in it's own self interest of self perpetuation and growth.
>I saw a good video explaining this obfuscation of language to get these 1000 page bills passed and some of the people they talked to admitted using it as a tool to get things passed that were favorable to whichever special interest lobbied harder or had deep enough pockets.

i was too embarrassed to admit this, but i was an advanced certified tax prep for a volunteer center. the forms were mostly simple. but i agree that it's basically criminal to expect a person of average intelligence to understand the tax code in itself.

one of the reasons i got involved in crypto was that i want to see the government forced to move to a sales tax, instead of manipulating voters with 'tax benefits' that are incomprehensible to them.

> If I trade 1BTC when it was, lets say $10000 for 10000 ShitCoin, when ShitCoin's market value is 10000 ShitCoin for 1BTC (so each ShitCoin is $1) how much tax do I pay on this taxable event?

You pay taxes on whatever you gained. That's why it's called capital gains tax. It doesn't matter if you trade it for shitcoins or pineapples. If you bought the 1BTC at 1000 and traded it for something else at 10,000 you owe taxes on 9000.

the forms themselves aren't so bad, and you can always air on the side of caution, and there is inbuilt forgiveness in the form of tax refunds, however, in the attempt to properly define and categorize all the aspects of wealth transfer which inherently can't be perfectly categorized, you ind up with over complex and hard to understand regulations.

the legislature behind the decisions is absurd. the issue with crypto is that the US didn't know how to define it. you could define it as a currency which would make trading like forex trading, but is it a security? or an asset? or a utility because there are utility tokens? are they similar enough to qualify for like kind trading? in the case of a currency does appreciation count as income? would holding a lot of physical dollars/ fiat require extra taxes paid if the dollar increased in value?
so all these questions pop up and the inability to fit it into a nice neat box combined with inherent greed of a government wanting to get a piece of everything leads to uncertainty, and uncertainty leads to inefficient systems, which isn't a big deal for the govt because they're the govt, but its a big deal for the individual who by law has to support such an inefficient behemoth

of course, this is the main point/argument of libertarians and small government advocates. and it makes sense in certain areas, unfourtunatly if you have some kind of incentive or think you have some kind incentive for expanding the govt then you will think this is terrible, but its easier to differ responsibility for your life to the government instead of taking it upon yourself because it IS hard

NP op just remember if you made money, pay taxes on the FIAT that you made.

when you "realize" gains, pay the tax on those realized gains.

again
daytrading = crypto >51% of your income and intentionally trying to ride waves, pump/dumps etc shorting/longing w/ leverage etc.
captial gains = holding long term or only moving with research.

Yeah, but the gains you make in a year on crypto are relevant since you can buy things with them.

Also I agree a flat tax is the only solution in the end.

That is completely wrong and you should feel bad for spreading this misinformation.

I also think using primarily sales tax or VAT tax is a better system, but good luck overhauling everything

It also makes you look like an entitled fuck that can't take a loss.

i agree. ultimately it was my fault that i now owe more than i'm worth to the government. i just can't believe it. i don't know how i'll pay it off. my job pays very little, it would take me literally decades of full-time wageslaving to pay off what i owe. i guess i'm just in shock. i can't understand how i can lose everything by making a huge profit.

again, you're only actually going to owe money if you actually made money, it's not that convoluted.

If youre not one yourself, there are a bunch of people on this thread trying to make you scared. What you say is not the case. If you never cashed out, then you've never made REALISED gains.

me too, I know I'm not completely fucked but I went from thinking I set myself up for a pretty sweet and safe start into working life to thinking I'm going to enter the job market with debt that I wouldn't have otherwise had, and such a big missed opportunity of holding what crypto I have left

I am a senior in college in the US that started the year with about 5k to my name.

the difference between ending the year with 5k, 10k because of taxes, or 25k is absolutely huge for someone just entering adult life/the job market, and if you don't see how big of an impact the difference in those three starting points can make, well then I don't know what else to say

lmfao at the people thinking you only pay when you cash out. The second you trade crypto for another crypto you 'realize gains' as far as the IRS concerned. You're going to be so fucked next year.

Underrated post.

The extra taxes are only APPLIED at cash out. I'm not saying they don't exist, but they do not need paying until you make realised gains on your assets (including crypto). This is literally the way capital gains have ever worked since the beginning of the concept of CGT.

And hypothetically, even if they weren't in your magical world, you could still offset the loss.

Have you considered putting the money you owe to the government (ya know, when ya make mad gainz) aside for safe keeping, rather than gambling it like a degenerate? This is literally how major companies operate all over the world.

You aren’t enslaved by corporations, taxation or the government - you are enslaved by your lack of forethought, addiction to gambling and general lack of financial literacy. The fact you can’t nail down your tax liability to a figure with less than 30% error (despite pretty specific numbers) only shows how ill equipped you are for this. I know you are a college student, but for fucks sake - people go to war and die younger than you. Take some fucking responsibility.

Also - do burgertards really pay 36% CGT? That is fucking Norway tier. At that rate you should use a shell company as the tax rate is lower, and you can claim expenses agains gainz.

CGT percentage depends on your total income, and if short term capital gains count as income, it sucks.

I've never had a high enough income to even have to pay taxes up until this point. additionally there is a sever shortage of information and tools to help calculate all your various trades in crypto markets, especially crypto to crypto trades if you need to figure out the cost basis in fiat at the time of the trade.

I did take a few thousand out, and I know I'm still responsible, but when you go from never having enough income to even file taxes to suddenly sitting on over 50k of assets, shit goes to your head, and if you haven't meticulously planned out what all the implications of this change is, yeah you'll run into issues.
I wouldn't consider myself a degenerate gambler with this stuff, yeah there is a super steep learning curve and I've made shit tons of mistakes along the way, but I'm still up nicely from where I started. the issue is timing, that I got into the market less than a year ago, and any and all transactions I make are taxable, and that tax rate changes based on what the market does. so in order to perfectly plan everything out, you have to know what the market is going to do so you know how much you are going to make or lose and therefore what your taxes will be like, which only happens in fairy tales.
and what do you think I'm doing now trying to figure this all out? I'm trying to take responsibility for all this and do the best I can, but if you ask me, it's ridiculous that this situation has arisen to this widespread an extent in the first place

and one last thing, how I am enslaved to my own financial/regulatory illiteracy when the regulations and the system is imposed on me?

The issue isn’t timing or information it is lack of planning. If you literally can not convert your holdings to USD then neither can Uncle Sam. Well, I take that back. You don’t seem like the brightest tool in the shed, so it’s quite possible that you can’t but the IRS can.

You wanna be a big dog? Then play like the big dogs play. Anyone with money, anyone in finance, and anyone that runs a business has had to do deal with this - quit whining about “muh fairy tales”. Millenial fuckwits like yourself are so used to having things handed to you on a plate you can’t fucking think for yourselves.

When you make a trade that earns you money, calculate your liabilities, make a record of it. Once a month, check that you have enough cash to cover this liability. If you have ever had a job, someone at your company (or at any large company) in a senior position was tasked with this job. If they fucked it up, the company goes bankrupt and everybody goes on welfare. I have literally met people who do this at a national scale, including one person that controlled 11% of the GDP of a SE Asian country. And if he was a bitch like you are being right now that country would be in real deep shit.

It’s not hard - you we’re smart enough to be accepted into community college so surely you can research this and protect yourself. My employer is a $350mm/pa company (not big, but not small) and the GM who’s job it is to make sure the dollars keep going to the right places is a fucking ex-tradie with no other qualifications who leads a team of accountants. If he can do it - and he does - then surely you can do it for 50k per year.

You are a fucking cuck. You have been sucking on society’s teat for so long, you don’t realise that you need to help put the milk in or everyone goes hungry. The rules are what make our society, without them we are just animals - not even good ones like wolves or bees, more like insects. The rules gave you roads, police, education. It enabled your parents to get jobs and support a useless, whiny millenial soyboy in the hopes that he too, will join society.

I started from nothing. My parents weren’t rich or well connected. I worked hard at school, I fought for jobs, worked my ass off at them, and looked after my personal finances from the second I left home (which was while I was studying). I am only maybe 10-15 years older than you, but somehow I have a stable life that doesn’t depend on either my day job or my investments, and I didn’t need to whine about how muh wageslavery kept me down.

If you want to live in a libertarian paradise, do go to Sudan or Somalia. Otherwise, be a part of the society that has given you everything.

Damn dude

I'm afraid you are not going to make it my man

Why do you guys need to pay taxes when you've lost money?

>pay capital gains
oh man you people are fun to take money from

because they made money in 2017 and owe taxes for 2017

Damn fucking straight user. Be responsible, contribute to society and play by the fucking rules or you dont get to have an opinion.

>blublublblbub i r a big goi dat noe his stuffs so i type at you liek a dumdum on dee internetz

>the absolute state of Platonians
Diogenes won the day Plato opened his retarded mouth

I want to add to this: Who creates the rules? If man creates the rules is he man? For without rules man can exist but without man rules cannot exist. How can you separate man from the rules if the rules cannot exist without man. Rules, therefore, must always have man. Rules are simply inventions. No different than any thought. The physical world is not altered by thought but by action. Action is dictated by thought but without action, thought is meaningless. Therefore, without action rules mean nothing and action is above rule. Actions are what create society. I have heard very little from you on the thoughts necessary for action to occur. Are you the farmer who grows the "milk"? Are you the metal worker who makes the farmer's tools? Are you a builder? A craftsman? What about the physical world do you have domain? Finance? Spooks of the mind? You enslave yourself to others and beckon for your brother to do the same. How funny.

you dont understand how crypto is taxed faggot.

>you only pay gains taxes on crypto when cashing out to fiat.
>you ONLY pay taxes on crypto when converting to fiat.

Capture stray cats and sell them as rare cats by painting them. This is what I did for 2 years and made 31000$

good goys

no the credit card bans caused the crash. the 2017 bull market was caused by normies maxing out their credit cards on coinbase

wrong. if this were true you could just:

>buy a baseball card for cash
>exchange the baseball card for crypto
>day trade the crypto
>exchange crypto for a baseball card a year later
>se