so I've been trading crypto for about 10 months now, and I've gone from 25k to about 250k still in crypto and having cashed out 85k via coinbase. Can someone explain to me how to do taxes? I met up with a couple accountants and they said that every trade is a taxable event, and that basically the trades leading up to whatever you had on Dec 31st midnight meant you would be taxed on those as well. I'll obviously be taxed on the 85k I cashed out, but what is this taxable event garbage? I have a few qualms with this because 1) I understand that when you sell a stock and buy another stock, it is a taxable event because you are converting back to fiat to buy another stock. This is not true with crypto, obviously. I personally didn't, but people make hundreds of trades per day. Are we really expected to calculate the losses and gains from EACH trade, and fit them together in a puzzle between 6-10 different exchanges, each receiving and sending bitcoin to one another? Yes I understand that exchanges allow you to print out the trades you made on their platform, but that doesn't take into account sending and receiving from other exchanges. It's a total nightmare. You would need a forensics team to solve some people's taxes. 2) The price of bitcoin is not stable, and varies across many exchanges and by the second. How do we calculate a trades worth? We don't ever know the true value of a bitcoin's price since we never went back to USD, so are we just supposed to "approximate" what price bitcoin was when we traded? Some sites vary the price of bitcoin by hundreds of dollars, sometimes almost one thousand... 3) What about sites like ether delta? They have no record or log of anything you do. I know I used it, but I don't remember when or how much, etc.
If I listed each trade my taxes would be like 50 pages long.
now u know why just don't pay taxes
Yes. Be consistent and document how you calculated. That's the best advice you're going to get on the bookkeeping side.
Just say you invested in btc years ago by mining it and recovered it from an old hdd. Why anyone is surrendering their trade history from bittrex or binance while still under the radar is beyond me
man what the hell is a tax lmao
>paying taxes on crypto
You have one of the following two options 1)do it yourself and go to jail 2) get every trade history off every exchange you traded on and give it to a professional
Either way, better start lubing your asshole now because you will get fucked hard.
because coinbase knows I bought and sold many bitcoins, and I've sold way more than I bought. They also have access to american exchange records, so if they decide to audit me, they will instantly know I was lying, and that is called criminal tax evasion.
buy some property with your BTC and sell it or rent it? OR buy gold, bit by bit and send it to your house
Can we keep the retarded suggestions to a minimum? I'm going to file my fucking taxes, the question is how?? There isn't even a record for some of the trades on ether delta.
Find a niece or nephew under the age of 14 and cash it all out into one of his bank accounts. Whats the chances he gets audited when his taxes probably dont even have a job reported on them, and whats the worst theyre going to do to a minor. Just use 10k of your earning and get a lawyer if they try to take him to court or anything and dont talk to anyone let your lawyer do all the talking for you. Oh yeah.. and quit being a pussy pajeet.
>paying taxes for crypto
What a fag.
Um yeah just pay the tax on 85K and be done with it. If they want to go on a wild goose chase through every single trade on every exchange then let them do it. Shit like binance is not even US based and they don't require any identification as far as I know. So...good luck to them putting the pieces together.
And then they make you pay with a 0 cost basis and hit you with massive penalties. The IRS always wins
No, if they decided to go after you, the burden of proof is on you.
>Shit like binance is not even US based and they don't require any identification as far as I know. I have no idea what the fuck compelled me to do the level 2 verification on Binance with a picture of my face and photo ID but man am I regretting it.
Keep looking for a good tax accountant/lawyer if you don't want to go to jail
You earned 250k from holding Monero. Give them the 15% long term capital gains tax and enjoy the rest.
This. Fuck telling them how you made the 85k just pay the taxes on it put it under lottery or some shit.. Or just transfer it all to monero, send it to another exchange with an anonymous account then send it all back in dash and tell them to fuck off because theyre never gonna trace your privacy coins and point it back to you idc who they are.
until they subpoena bittrex and find a pic of me holding my id next to my face and find out about the thousands of trades I made.
>level 2 verification kek what a rookie
nice dubs. fuck move it around in privacy coins and tell them enjoy tracking you down.
Coinbase has reported all users to the IRS, they know it's crypto and they know what you did via coinbase, bittrex, and poloniex (which I think is america as well)
Just send it all to me since youre such a pajeet and write it off as a charitable donation
Lmao amerifags are so cucked
>fuck move it around in privacy coins and tell them enjoy tracking you down.
There is no quicker way to identify poor fags with sub 2k portfolios than by the way you talk.
If you made half a million and cashed out 250k, you wouldn't just "move shit around in privacy coins" and try to outsmart the IRS.
OP just pay short term capital gains.
stop listening to paranoid faggots who think you will get audited for a tiny (relative to corporations) amount if you already paid short term gains.
seriously, stop fucking being a pussy.
You can sell it all on localbitcoins for cash to reputable traders with 5k+ trade over 250k USD handled each, and spend the cash slowly for things like groceries and oil for your house ect, then let your work income just pile up in your bank... idk, get your own ideas im going to bed.
every thread, cant fail to laugh
I don't want to pay taxes so a bunch of Christ-killing kike parasites in Israel can bully Palestinians and connive us into fighting their wars.
Yeah I'm in college now but started with $500 but I'm up to 10k now so idgaf
pre 2018 crypto to crypto trades are like kind exchanges. You can pay taxes on them if you want but you don't have to.
You are social conditioned to think you have to conform the system, no you dont have to pay taxes for people who are lazy niggers, rapefugees or just unwilling to reform, you are a faggot for paying taxes
I don't think so, also you have to file paper work for a 1031 exchange (which is the "like kind" exchange you're referring to).
If you tried to file the average crypto trader's tax returns using 1031 exchanges your tax returns would literally be thousands of pages.
>don't pay taxes
Easy to do when you live in your mom's boyfriends's garage.
OP, just tell the IRS to go fuck itself worst case scenario you will have to use swiss banks or some shit to tax dodge, taxation is theft, spics, niggers and other untermensch can go fuck themselves and die fuck welfarefags and the (((IRS)))
You traded the worlds greatest tax dodging currency... for cucknotes(USD) ?
Nice try, Mr. Shekelstein
>only allow professionals to do taxes, or you will go to prison
you can do your own taxes and as long as it's believable you won't go to prison
at worst they'll make you pay the difference if you calculated wrong
>trying so hard to justify being a cuck Enjoy getting your gains NTR'd from you, faggot.
>the absolute state of the new world debt slave goy
You burgers have a strange system. In the UK, crypto is treated like any other asset and you pay capital gains when you cash out, like any other asset.
Since its Chinese New Year ill give you the gift of DOGE and enlighten you with some knowledge bitcoin.tax
YOU WILL THANK ME LATER OP
>let random website log into all my exchange accounts >"where did my bitcoins go??"
Cash out buy tax heaven passport Denounce your US citizenship ???? Withdraw all that sweet cash to your new country with 0 tax.
Depends on the amount of trades you've done and whether you lost money along the way could still be more profitable to just say you mined it.
>paying taxes laughable really
honestly will the irs give a shit if you pay income tax?
i dont think they will go after you and if you do, just hodl the fiat for 4 years until statue of limitations run out
what can go wrong?
Just to be clear: You will be taxed on the 85k, but you will NOT be taxed this year. You will ONLY be taxed for everything you did up until December 31st, 2017. You will be taxed for the 85k on your 2019 tax return.
kek its going to be fun since the irs is going to make an example of a crypto trader and its going to be all over the news wonder whos going to be the lucky one
No point in paying crypto to crypto taxes IMO. IRS has still not released clear regulation on crypto and I doubt they are going to hunt down the millions of people who have done crypto to crypto trading, especially since everyone knows it's unprecedented territory.
taxes dont have statute of limitations, but yeah they probably wont. just the guys with 7 figures or a couple of 6 figures those dont number a million maybe in the hundreds
Bitcoin.tax is legit user, do your research faggot
sure it is, pajeet.
>Denounce your US citizenship Enjoy getting taxed for that too
You don't go to jail if you don't pay taxes.
as long you keep it in crypto, they can't tax that
as soon as you withdraw though Taxed
What if you buy something with crypto? Would that be taxed? Because if it would be, then crypto as a currency (BTC, BCH, XRB) would be pretty fucked.
number 2 is the biggest one for me. the only thing that makes sense os to ise a btc value that reflects what was available at the exact moment of sale, but the differenc between 5 mins let alone a day could be a dofference of thousands of dollars. as far as i know a daily average would be acceptable but this could make you liable for thousands in taxes based on an unrealistic idea of value due to how volatile btc is from moment to moment
>mfw I am not an amerifag and I never touched any of the yankee spied exchanges
Get ''hacked'' by a ''third party'' Like some keylogger/phishing attack And cash it out thru local bitcoins or ATMS You can even try some exchanges that don't require verification and turn it into monero or something
Is what you should have done You can't be helped for what you already cashed out