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Reporting Bitcoin on taxes

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CalmSeeker

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Jul 2, 2021
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317
@Lordy
I use wasabi, and their fastest transaction fees are never more than a buck. Usually ranges from 25 - 75 cents. Your confirmations for purchases will be made usually in 20 minutes or so.
 

Gullible

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May 15, 2011
Posts
2,735
The government wants to not only get every dime of taxes out of you, they also want to monitor and control you. Did you know that the bill the dems slipped through says that all transactions over $600 now get reported to the govt? That includes paypal, checks, mg, wu, etc. I have no intention of reporting every single transaction I make and if I buy something with bitcoin, its my business and no one else's

I did sell a couple coins in oct - nov and just sent in a check to cover expected taxes. So that will make me check the yes box on that form and I will write down the dates and so on. I'll do that for something big which they are going to see anyway but a $50 or any size purchase is just going to fall through the cracks. At some point I think we need to push back against govt overreach. I do my small part

Speaking of bitcoin, those who followed my advice to invest in it and not just enough to buy something have made a pile of profit. It went from around $9k per coin a little over a year ago to 66k at a peak, back down to 43k now and soon back up. But even selling right now let alone a few months ago when it was high, gave you a huge return on your money.

Cash is going to steadily lose its buying power and bitcoin, while its volatile and scary, will go up in value as the dollar/pound/euro goes down
 

CalmSeeker

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317
I finally asked my wife, who is a CPA, about this. First of all, do we know what the exact wording of the question is, and has it changed from last year? I ask this because when my wife did our taxes last she interpreted the question more about did you do any trading and were gains or losses made. She knows what I’m up to with BTC and answered no, and is probably going to answer no again, unless the wording has become more specific. But for right now, unless you’re trading large amounts through exchanges, the suggestion is to answer no.
 

Name taken

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Joined
Feb 8, 2021
Posts
609
I think the language from last year’s TurboTax asked if I purchased, sold or used crypto for payment but my memory is very fuzzy and I don’t have my 2021 tax year form started yet. I am in agreement with what others have said, unless you have spent a large amount of money and made a large amount of money they don’t go after you but you still I think you have to report it. Now I need to go look up exactly what turbo tax asks for that question. To me, as long as I’m not using it as an investment that generates capital gains it shouldn’t be any of their business. But the government doesn’t work the way I want it to😏

Edited to add: I think the question was about buying selling and spending crypto. Apart from people who are making taxable capital gains on it I don’t think it should be any of their business but unfortunately that’s the way the IRS is going.
 
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Dee420Bard978

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Jan 16, 2022
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3
@Japaholic can you buy Btc or etherum? With prepaid visas and also I Have no income from a job & loaded 380 do i have to report to the IRS i loaded that cause hahaha within the next year ill be purchasing 10s pf thousands screw the IRS whats capitalism with them standin in the way thats the only reason they made BTC a currency so they can screw you !
 

Dee420Bard978

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Jan 16, 2022
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3
Hey wussup yall im currently using coinstar to purchase im really trying to learn the stocks of crypto but i thought when you put you're money in your wallet it doesn't fluctuate and i lost lik 30 40 bucks plus fees is their a better way to buy btc can i use a prepaid visa to purchase btc or crypto online and put it in a more "stable wallet"
TY
 

rhodes23

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Joined
Dec 5, 2018
Posts
135
Crypto has fallen in the past couple of months so if you sold anything at a loss from your previous purchases then you can declare the loss on your taxes. It's like stocks, real estate or any other financial asset. You pay taxes on your profits but also you can deduct your losses. It only applies if you sold your holdings during the tax year for a loss or a gain.
If you're someone who just keeps a $100 or so in the account for online purchases I don't think you really need to declare anything. That's my take on it anyway. Any tax accountants out there who can confirm?
 

rhodes23

Senior member
Joined
Dec 5, 2018
Posts
135
Hey wussup yall im currently using coinstar to purchase im really trying to learn the stocks of crypto but i thought when you put you're money in your wallet it doesn't fluctuate and i lost lik 30 40 bucks plus fees is their a better way to buy btc can i use a prepaid visa to purchase btc or crypto online and put it in a more "stable wallet"
TY

No such thing as stable in the crypto-world. The markets have been in decline recently so that will affect your holdings regardless of whatever wallet you use. Your wallet should allow you to transfer back and forth from crypto to dollars. Anything held in the dollar account shouldn't fluctuate but any crypto you hold will constantly fluctuate along with the crypto markets.

Also no reason to report anything in crypto useless you've converted back to USD.
It's like stocks, which go up and down. You haven't really lost or gained anything until you've sold the stock and converted back to cash dollars.

So if your crypto has fallen in value it might be best to just sit tight and wait for it to rise again as it may likely do before too long.
 
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heavymetalviolet

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Aug 15, 2021
Posts
119
This is also concerning to me. Aside from using items like Paypal to purchase what I need, I also do side hustles where clients pay me through Paypal and Zelle. I'm surely not rolling in the dough, but the fact that this is being tracked is a bit nerve wracking, especially if they start asking me what am I buying, etc. A few of my clients have already tumbled to this and have advised me that they will be using the friends and family setting, which I think (?) protects somewhat, but also doesn't give you any recourse if someone runs off with your money (I actually got scammed by a friend this way and she ran off with the cash). Meh. Just another way to screw the small guys if you ask me.
 

CalmSeeker

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Jul 2, 2021
Posts
317
@Dee420Bard978
You can’t control whether the value of crypto currency will fluctuate or not. Having it stored in a wallet means nothing; it’s value will always be what the market value is.
 
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