End of 2017 you've turned 10k into 100k

>i have a relative who believes he must pay taxes on his crypto because he's a cuck. there are sheeple out there so submissive to the fed.gov they'll do whatever they are told.
have fun getting cucked by the long dick of the law, losing all your cryptogains to backtaxes, and thrown in jail

End of 2018 and your 100k house in now worth 200k.

The 100k profit is taxed at 40% (short term cap gains) which means you owe the govt 40k.

since decemeber the housing market crashe and youd house has lost 60% of it's value.

You see where I"m going with this OP?

> Come April the tax threads are going to explode
> The IRS goes into absolute autism mode trying to lock down crypto profits.
> IRS Largely fails and complains that almost nobody reported crypto gains from 2017.
> IRS turns toward people who tried to be honest and makes an example out of them.
> Pink wojacks threads appear on Veeky Forums to create more fud and express they have become a target.
> Getting donations for being targeted becomes a meme.
> The crypto technology landscape changes, adapts to current taxation situation.
> IRS BTFO for another couple years until they figure out how to tax the next wave of technology.
> IRS begins no bullshit trying to tax literally all digital assets. Video games (Mainly MMOs), likes on Facebook, number of twitter followers, and god knows what other shit they come up with.
> Next generation, already potentially the most conservative in the history of America, goes full out counter culture to taxation.
> The Pendulum swings so far to the right that leftism will look like a cult that died out in the early century.

People like you trigger me so much. The government has done nothing to earn that money. It is literally theft if you pay it and it is literally kidnapping and rape if you are put in jail for not. I don't know how you can work for the government and not kill yourself. When will people get a conscience? Or has everyone had their humanity scooped from their minds via chemical labotamy?

The cashing out meme must stop. If you bought 1 BTC for 1k in 2017, then traded it for 20 ETH at 20k during December, the IRS will see it this way:
Buy 1 BTC, Cost $1k
Sell 1 BTC, Proceeds $20k
Buy 20 ETH, Cost $20k.
In the second step, there's a profit of 19k, "cashing out" or not. You owe short term capital gains on the 19k profit. Let's say 10k in taxes.
What Op describes is exactly this + you're holding your 20 ETH. If your 20 ETH are worth less than 10k, you can't pay your taxes.
The mistake was making a trade during ATH, realizing (a lot of) profit and not putting that money aside to be able to pay taxes. You essentially borrowed the taxes and speculated with ETH.

>In the second step, there's a profit of 19k, "cashing out" or not.

Problem is, there was no cash out. Not technically. This logic can work for bartering. It cannot work for digital goods because digital goods are not equivalent to physical goods. Digital goods can vanish randomly, digital goods can be generated from nothing.

This is why the IRS is doomed.

>End of 2018 and your 100k house in now worth 200k.
>The 100k profit is taxed at 40% (short term cap gains) which means you owe the govt 40k.

What you don't realize is that real estate is exempt from capital gains on profits up to 500k

That and real estate is a physical asset too. Some bad ram or a hard drive crash wont suddenly make you land stop existing forever.

>In the second step, there's a profit of 19k, "cashing out" or not. You owe short term capital gains on the 19k profit. Let's say 10k in taxes.
50 percent capital gains tax on a person with income in the middle to low-middle class bracket? Why do you come up with strawman scenarios that almost will never happen?

No... that's exactly how it works. At least in the USA.
You pay taxes on your paper gains, and then you lose all your paper gains. Leaving you with only real losses from the taxes.

I don't disagree, yes they use violence to exert their control. I for one don't want to face those consequences so I'll pay them off. Have fun trying to hide it from them.

>No... that's exactly how it works. At least in the USA.
>You pay taxes on your paper gains, and then you lose all your paper gains. Leaving you with only real losses from the taxes.
Yeah but you dumbfucks come up with implausible scenarios. The tax bracket for most people here is not 40 percent, it's something like 10 - 20. That's a huge hole in your argument. We are not Wall St hedge fund managers, we don't make six figure incomes.

daily IRS cuck thread

>We are not Wall St hedge fund managers, we don't make six figure incomes.

You only need an income of 30k a year for 100k of crypto gains to put you well into 6 figure income bracket.

the absolute state of burgers

I wonder. How many prisons they will need to build to hold Veeky Forums in

It's just an example of what op is describing, faggot. In op's case there's 90k profit which brings you into a higher tax class anyway.

On top of that, digital speculative assets that go up or down constantly. Taxing each trade is retarded beyond measure, only a single tax on realized gains should exist.

In the US, there's something referred to as the "kiddie tax." NEETs here should be very interested in this. If you had less than $5k "earned" income (NOT investment) then you're dropped into your parents' tax bracket for all your investment income.

> Taxing each trade is retarded beyond measure, only a single tax on realized gains should exist.

Its impossible to do it any other way. A lot of people on here are still in the "the IRS knows what its doing" mode but anyone who examines the situation understands its largely unenforceable.

That's up until the age of 22, I believe, but it might be 25.

Unfortunately your kind are the majority. Thanks multiculturalism for flooding the borders the with the fucking Borg.

I like this story a lot. Would play in this game

No he's right that is what happens.

What are you talking about?

FUCKKKKKK. I made 4.5k from my job in 2017 but I also made about 100k in crypto. I'm 23. What does this mean for me?

>not understanding capital loss

>"hodl"fags completely btfo.
If all you've done is hold you haven't realized any gains and owe no tax you brainlet.

It's only if you're a dependent of your parents. So if you're a student living in dorms/apartment or living at your own place, you're fine. If you live with your parents, check the tax code.

would a CPA know? I am hiring a crypto CPA because I have thousands of shitcoin trades on various exchanges. I know about bitcoin.tax but just want peace of mind

Fuck paying taxes
I trade on etherdelta, forkdelta, and idex
Fuck off irs

thats not true, im using bitcoin.tax to do my taxes and I am not taxed on paper gains at all

>trading on US based exchanges

>realized gains
Brainlet detected, here’s your (you)

Glad I only put in less than 1k. This is a long term investment. People throwing every dollar they have are taking a huge risk. A high reward may not be worth it. DYOR.

It's taxed as income you fucking mongoloid and unless you are making 150K a year outside of Crypto then it will be at MOST 20K.

This but unironically

The IRS threads get so much discussion. We are fucking scared and also tired of the IRS at the same time. Enough of this corrupted taxation that doesn't do anything, but keep the people down the elite up. It's fucking time we do something about it. I'm afraid the blockchain is not the answer when they're always two steps ahead of everyone. Fuck any politician for never standing up to it. Trump is doing absolutely nothing. More jobs, more this and more that. No. We are so scared to end their 100 year plan.

Can't you deduct losses from your tax payments? Or is it only a percentage?

look at this brainlet and laugh. you're taxed on realized gains. you aren't marked to market for taxes, only when realized. are you taxed on a stocks value increase before you sell it? no.

businessinsider.com/how-paying-taxes-on-bitcoin-works

i guess y'all neets haven't seen the investment forms since you're poor, but your broker mails you them every year and there's an 'unrealized gains' bucket and a 'realized gains' bucket; guess which one is taxed?

sage OP seen his shit before.

This. 2017 tax bracket puts this scenario at 28%. It's 39.60% if you made over 418k

28%
$91,900 to $191,650

precisely why i've been holding since August. at least i'll only have to pay 15% when i cash out my OMG profits

A couple years back I did some contract work and was making about 30 USD an hour. I worked about 6 months doing about 20-30 hours a week.

I was hit with 35% taxes on my gains. And that wasn't including state taxes which were separate. I was barely able to survive on that because of how badly I was taxed.

They want blood with crypto, you can bet your ass on it.

i don't report, don't give a fuck if I get sent to jail for ten years they will never be able to find my digital gold that's the whole point

Lol you idiot just keep hodling like me until you go back to your initial investment.

t. guy who doesn't have to figure this all out

The foreign exchanges are not beholden to another foreign bureaucracy. They only know what you convert back to fiat or are dumb enough to use Coinbase.

Here's what's going to happen

>tax season ends in April, IRS going to report that hardly anyone reported crypto
>IRS goes full on rage mode and starts making examples out of specific people that were dumbasses that swing traded to and from fiat on Coinbase in an attempt to scare the public
>Some more people will report, but most will just pretend like they have nothing
>Decentralized exchanges start popping up, hiding money in crypto becomes as common as normies pirating movies
>The global revolution starts as the public realizes that blockchain tech allows them to have full control of their money, without needing a government.

I'm fucking excited for the next decade or two to see how the world is shaped.

decentralized exchanges are a really rough blow for governments and taxation. At that point its pretty much over for taxation of trades.

Also how are people going to cope with the fact that if you are ok with taxation of crypto then taxation of how many twitter followers or World Of Warcraft gold makes a lot of sense.

Next couple of decades is going to be insanely tough on establishment people.

Only if you're a burger which smart people are not.

In December 2017, the IRS released an announcement saying that crypto-to-crypto trades would constitute realized capital gains. Previously it was up in the air whether it required a trade back into fiat currency, or whether cryptos could be treated as 1031 like-kind commodities.

>next generation already one of the most conservative

That bubble you live in must be lonely.

damn, literally the same boat but i’m 20 instead

>You pay taxes on your paper gains
Did you lying kikes remember to pay taxes on your video cards? The card you have in your computer is worth 3x now what you bought it for, so you owe taxes on that gain even though you haven't actually sold anything. You paid your tribute to Israel, right goyim?
>this is what lying kikes want the goyim to believe

i live in Portugal no crypto taxes

This is actually well known right now. You should keep up on current events. The people who want to ban video games and censor Piediepie are leftists.

In the 90s it was lame to be conservative and these days its lame to be butt hurt gender fluid snowflake xir attack helicopters.

The next generation is laughing its fucking ass off at leftists right now.

>40% of 90 is 40
Stopped reading there, OP is a fucking brainlet

Just move out that retarded country man

I don't understand you at all. Every country on this planet charges taxes. They are applied to every citizen. They pay for things like roads, schools, military, etc. To call it stealing is not true. Stealing you get nothing back. Last time I checked America gets the world's biggest military out of those taxes.

This isn't the argument that holds water in the Bitcoin context. The problem now is that Taxes are no longer sustainable. How do we move forward from here on out?

And the "blah blah they can force you to do it blah blah." argument doesn't work anymore either.

You have new fish to fry on the justification of taxation addendum. Old arguments are BTFO.

It's marginally more conservative than millennials, and I expect that will change as Trump continues to blow it

> It's marginally more conservative than millennials

If young people are even slightly conservative then it means they will be even more conservative as they get older.

> I expect that will change as Trump continues to blow it

Whats he blowing exactly? The only things that seem to be him "blowing it" is when he tries to lean to the left on banning video games and guns.

>Gen Z wants a glass dome
>Ivanka for Queen

I hope that crypto is the catalyst that forces the government to move towards a Land Value Tax. Look it up. It's the most efficient kind of tax and it's the only kind of tax that has no deadweight loss on the economy.

topkek actually paying taxes

>his country doesn't give him tax deductions on his crypto losses

literally this

TOPKEK

>thinking you get taxed on an investment at the hight of its value during a fiscal year
Fuck off idiot brainlet

Make sure your coins are off the exchange (especially if its based in your country) amd if they ask what the fiat leaving your account is from say ots for online gambling

Bro like half of American taxes literally go to useless third world savages

>you sell everything for BTC/fiat and rebuy into your positions which realizes your 60% loss
It's not hard, dummy

this is true, but only you sold for a profit at some point.
case 1:
for instance, if you bought 10k of btc and that grew to 100k, then you bought alts with the btc, and lost the 60k, that selling of btc into alts is taxable, and because you have not realized your losses by selling at a loss, you can't deduct them from your net.
in this case, the best action to take is to sell everything all the alts at a loss before the end of the calendar year, which would deduct 60k form your net taxable income so that your net taxable income would be 40k at a rate of 25%, leaving you with about 30k to start the next year with. so still up 200% all told, but nowhere near what you had at peak.
case 2:
alternatively, if you traded your way buying and selling up to 100k, then held all the way back down, yes, you owe 40% of the 100k realized gains minus no realized losses with only 40k of asests so zero after liquidating to pay taxes. you are then stuck with getting compensated for the 60k net losses you take for the next calendar year because you sold at a loss in 2018 to pay taxes from 2017, which has a max cap of 3k per year loss compensation, meaning it would take 13 years before getting that 40k back.
case 3:
you bought 10k of asests, sold none, and it was valued at 100k at end of year. you held all asests, selling nothing, and you dropped to 40k. here there is no realized profit or loss, so you do not owe taxes your investments for the calendar year: ex: bought 10k of btc at 2k early in the year and held for the whole year, reaching a peak of 100k, and now sitting around 55k value. no sale= not taxable event = no taxes.

taxes only occur when you sell an aset, and b/c crypto doesn't qualify as like for like, any sale into another crypto is taxable event.
this is why you need to plan ahead to find the best path through the tax laws, and you need to act on that strategy by the end of the calendar year

Looks like we got a Good Goy here.

The only reason the federal goverment has as much power as it does is because we the people are submissive sheep You my friend are apart of the problem. all those taxes you pay don't go to anything that benefits you instead it goes tohave you replaced with tyrone jamal and muhammad. I do not intent to give up a dime of my crypto earnings to the corrupt goverment. I'd rather brink it and die than knowingly contribute to a kike run system.

Fucking incredible rabbit hole you just sent me down. Thank you, user.

Explain it for us brainlets

seriously best case cenarion,
although i would accept VAT as a 2nd place option.
only tax on expenses. yeah it incentivizes saving and disincentives spending somewhat, but based on current debt crisis this it could be good, although could slow spending and start a small slump. either way, I'll take it over the bloated idiocy currently in place which tries to define and categorize every type of income/spending in order to tax properly which is a futile task leading to a massively flawed system.

from my understanding it takes the value of any owned land based off a number of things and then taxes it accordingly. so land squatters (billionaire faggots who hoard land) would be forced to sell as the tax would be too much. essentially what it does is encourages land development and equality. more people will have access to good land with the motivation to properly develop, thus being able to easily make the tax payment while still acquiring personal wealth without the burden of an income tax.

I believe i have it correct.

the biggest issue i see is making sure that the land is taxed fairly and that the land auditors aren't corrupt our bribed.

but in america there is massive disparity in land ownership.
what about the fact that a rural farmer who owns 100 acres of corn fields and makes under 100k a year, vs a city dweller who owns 10 different million dollar condos in luxury high rises which due to the small footprint of the building compared to the square footage of living space leads to essentially zero tax on individual owners.
you would need different rates for different areas and different types of land used in different ways.
there are massive areas of useless land that cannot be developed, that are not worth selling that would turn into unbearable tax burdens but do to the minimal value of the land, there would be no one to buy it due to the tax burden with the only solution being that the govt initiats a massive buy-back program but this leads to a natural govt. monopoly on the land market, and greatly diminished the available "private property" and we all know the terrible things that happen when private property becomes less of a thing and the government holds that kind of position.
also, what about mineral rights. say you own 100 acres and mineral rights to a massive crude reseve underneath but only need a 1 acre footprint for a drilling platform/operation, do you still have to pay taxes on all 100 acres? can you sell the rest but retain mineral rights? who would buy that land?
etc etc etc
try looking at VAT instead

he is about to blow it on trade

if he causes the stock market to tank before mid terms, Republicans might lose a fucking midterm election

which they normally don't

the deduction is for 2019 taxes and limited to 3K per year

if you have 30K losses, you'll be deducting for ten years

t. buttcoin

Land Value tax has only one downside : it fucks over farmers disproportionately compared to industry, services and housing. VAT is largely superior in every country that has a trade deficit.

LVT is not fixed, but based on how much land tenant is willing to pay

>IRS comes up with a blockchain solution
>USD is completely turned into digital currency.
>Physical cash is phased out and banned.
>All transactions are recorded on the government's blockchain.
>Not one penny will go unaccounted for.

But user, if you don't pay taxes, who is going to give money to minorities and single moms?
Who is going to build crumbling infrastructure, neglect roads and brainwash our children on communism?

heh, I bet you're feeling pretty silly right now.

>They pay for things like roads, schools,
Yeah please look up how much of all the confiscated money actually goes to that before you ever mention it again.

this seems very likely as I have heard that they have been trying to phase out paper and metal currency for a while so people become more reliant on debit or credit cards.
though it could be more of a trend in use.
That people just find it easier to use a credit and debit card rather than cold hard cash.

Question to all anons on this thread though.
How long do I have to HODL my crypto so I have the least of amount of taxes I have to owe?

If you're a burger, hold it for more than a year and don't work. If your income is below something like $38k you don't pay any taxes on long term gains. This will probably change in a couple years when neet crypto millionaires become a regular boomer news story and people get butthurt but I'm going to ride that as hard as it can while it lasts.

Taxes? I lost my initial buy in