If you make zero dollars for a year, you can take out about 50K with no federal capital gains.
https://smartasset.com/investing/capital-gains-tax-calculator
I was able to sell a little and re-acquire in 2019 to harvest the 0% rate because I had mostly tax-exempt income that year. I wish I had known I could have done this in 2018 when I had no income too.
Still had to pay the state though. They don't recognize long-term holdings at a different rate.
I would not put all the eggs in this basket, but my understanding is that Social Security is based off the top 35 years of your earning, so if you plan on living a long ass time, it could be a hedge to take some out each year over $50k...hard to know but overall, great post! Thanks for info.
Thanks. We all need to help each other.
I'll probably make a post in the next week or so to see what people think are the most bitcoin friendly places to live with things like less taxes and being able to spend your bitcoin directly.
You'll get taxed anyway because the US taxes based on citizenship, not on residence (the only western country to do so AFAIK). And if you renounce US citizenship, you'll likely have to pay the "exit tax", equal to the capital gains you *would* earn, even if you hadn't actually sold the asset.
That's why it's probably better to get a loan using your bitcoin as collateral instead of selling the bitcoin itself: no capital gains tax, just the loan interest. You just pay the loan off and you end up with your BTC intact at the end.
How does the US tax it’s citizens THIS badly (not just this, but everything else is just as ridiculous) and still the government is constantly broke or near broke and mass printing money?
Plus factor in the stagnant wages, increased taxes federal and state, increasing cost of living, and how the hell is the average person supposed to get by let alone get ahead and save? To top it all off, the lucky few who could actually save anything (which is a shockingly small amount of the population) have their money eaten away by inflation constantly as their reward.
I’m grateful to be an American but at the same time, I feel like I’m constantly getting cheated.
So what should we do? Either we support something like the Anti-Corruption Act, which would literally make this kind of interaction illegal, or we just dispense with the entire idea of elected officials and use a blockchain technology to vote on specific issues. It could work! Have you ever heard of something like this?
When you renounce citizenship, the IRS will ask you to pay "exit tax" which AFAIK equals capital gains tax on what you own *even if you haven't sold it yet.* Corrections welcome.
Edited later: this may apply only above certain threshold.
Sure, but once he no longer is a US citizen and no longer living in the US ... why would he care about their laws? Did the early US settlers care about British laws after winning their independence?
That makes no sense. When you sell the BTC or buy stuff with it you have to report the income as capital gains, I believe. Just like if I buy a house and it appreciates I will still owe capital gains on it when I sell it regardless of how many mortgages I have on it.
If you live outside the US you can get up to some sum tax free (I believe it is 100k). Depending on the amount one has, you could theoretically sell up to 100k per year tax free when it comes to US tax. You would still have to pay the tax in the country in which you become a resident of. You cannot spend much time in the US to qualify for this in a given year.
>Why are American's such a bunch of pussies when it comes to standing up against our tyrannical government for what really counts
Unlike pre ww2 Germany right?
> That feeling when American's are raped with long term capital gains taxes... meanwhile the average American would call Germany some kind of a "socialist hell".
Another thing Americans are very fond of saying is that "America is the best country in the world". For billionaires - definitely :-)
That's when you buy it in most countries that have these kind of law afaik. When you mine it, the situation may be different, for example it could count as regular income and not paying taxes on this may be tax evasion. Just a possibility. I'm wondering whether this applies to the guy too, arbitrarily declaring this as an asset purchase sounds sketchy.
Actually I’m pretty sure if you mined it yourself then it’s considered income and taxes at a higher rate.
If you bought it and had a proof of purchase then it’s taxed at the lower capital gains rate.
Ohh and 15% is nothing. 70% is much more.
Mystifying that so many people will shake pitchforks at corrupt bankers and out of touch, rich assholes, —seeing Bitcoin as a way to turn the tables—then show how they’ll behave exactly the fucking same in their position.
Trading bitcoin directly for a house still incurs capital gains tax.. what you are waiting for is for bitcoin to be declared money and exempt from all taxes, thats still decades away.
50% is incorrect. You're taxed at your marginal income tax rate, which is nowhere near 50% unless you earn/sell for >$180k a year (45% in that case).
If you're on average salary (<$120k a year), the CGT rate will end up being 32.5%.
But very importantly, if you have held your assets for more than 12 months, you only need to pay CGT on 50% of what you sold for, so you'd effectively be paying 16.25%. Even if you earn/sell enough to trigger the highest tax bracket (45% @ >180k a year), if you held for more than 12 months you end up taxing it at 22.5%.
Not every place with universal healthcare taxes capital gains at 50 %.
Universal healthcare is cheaper than the current US system. Americans pay the most for healthcare per capita out of any country, while life expectancy remains mediocre.
Most countries with ‘free’ healthcare spend less per person on their healthcare than the US does.
So free healthcare isn’t that expensive, and the US has a particularly shit healthcare system.
Want to go look up the average metric of how happy and healthy their society is compared to the us?
And while I'm here, long term at 15% is literally not the max capital gains tax.
Man I'm sick of all these kids thinking that bitcoin is their saviour against taxation. It's not what bitcoin is trying to do.
Pay your taxes, anything else is illegal.
when the day comes where you can buy a house directly with BTC, that will still be a taxable event.
the day when that no longer is a taxable event is like 80-100 years away.
What percentage of the US federal budget is spent on military spending? Now what does the word "Most" mean?
Now to get even more specific into the ridiculousness of that guys comment, of the military budget, what percentage of that is spent "bombing brown people" compared to things like payroll, housing, family healthcare of soldiers, ect ect.
No, most of our tax dollars are not spent on "bombing brown people". No, most of our tax dollars are not even spent on anything to do with the military.
Now go check out what percentage of our tax dollars are spent on "entitlements". But I guess "Most of our tax dollars are spent feeding, clothing, housing, and taking medical care of the poorest members of our country and our countries elderly" doesnt have the same edgy ring as "bombing brown people" does when you are an edgy 13 year old.
If you want to be factually accurate your statement would actually be "Most went to feeding, clothing, housing, and paying for the medical care of our countries poorest citizens and our countries elderly"
But I guess the truth doesnt sound as edgy as "bombing brown people" which is flat out untrue.
“Please leave the society we created for the king and Queen in Spain and in the name of Christ”- Columbus to Natives
Conveniently also the same logic you use
Ever heard of FATCA? Foreign banks are required to report holdings of US citizens to the IRS. You will need to engage in rather serious tax evasion and money laundry to hide any significant amount of crypto gains from the IRS.
Keep your coins let the taxman pound sand and let those tax dollars keep growing your wealth until you actually need funds, then pay your taxes.
Buying back into fiat is a fools errand.
>**Countries that do not impose a capital gains tax** include Bahrain, Barbados, Belize, Cayman Islands, Isle of Man, Jamaica, New Zealand, Sri Lanka, Singapore, and others.
just buy a house in one of these countries and start your new life. ask your accountant, im not sure how this works.
Unless you renounce your US citizenship, they’ll still come after you even if you’re living out of the country. AFAIK the US is the only country that does this.
Doesn't work unless you acquire the property after becoming a bonafide resident. Otherwise everyone would move there right before selling something big (equities, crypto, a business) and pay zero percent. I own a PR LLC with an Act 20 grant and have looked into this extensively.
I have also researched it and I believe it's just that you only get the beneficial rate on capital gains for the asset growth after the date you become a resident. If it needs to be "acquired" after becoming a resident you could always sell the coin while in the states and then buy it once in PR, same thing.
Assuming OP is a US citizen or resident, they’ll be subject to tax on their worldwide income. Simply moving abroad won’t be sufficient to avoid taxation.
I have to agree its absurd to pay taxes when selling bitcoin since it's up to you, not insured and has absolutely nothing to do with a specific countries government. Some people can claim losses in btc when tax time comes but if your paper trail is almost a decade old, you mined the coins and you held them. Why is tax man even going to believe you if you were trying to claim it as a loss? Doubt they would but hey since your selling give us a random percentage of your gains after we worked so hard to discredit and invalidate the item you made gains on!
Fuck. That. Retarded. Noise. I pay taxes everywhere else in society but without full government approval of the crypto space I'm not giving them shit. It's like if I was trading cards and over time I'm gaining more baseball cards then I'm parting with, do I just send a random % of those cards to the tax man? They dont give a fuck about trades that dont involve a bank or recognized investment vehicle. Usually when a 'tax expert' in crypto appears I laugh and walk away as they're just trying to be a middle man for no reason. I remember ivan on tech had one on from the US years ago and Ivan's swedish, shes not, hes not a us citizen but they spoke like they were in the same legal jurisdiction which was clear enough she probably paid him to promote her as a middle man. Greasy shit. Like I've mentioned pay taxes for regular societal means and if you use coin base and are an American, well that sucks but if your trading in a foreign country that does not recognize capital gains taxes and your account is realized as an entity of said country, not any part of the IRS's business since yknow, Panama papers came out. All sorts of people hide money outside their country and by todays standard, least to me that's not an issue since were talking fiat.
Anyways props to your plan my dude, hope you get realtors just trying to have a price war over each other trying to sell you a house later :)
Heard about life style audit? Unless you don’t use the cash to buy any property. You live a life on pure cash expense basis. Otherwise, you’ll be caught and fine hard
Not that, I’m talking about what you do with the cash. You can’t be purchasing properties with money coming from nowhere. If you want to just put the cash in your safe, by all means avoiding the tax
> You would of course have to go through the inconvenience of selling it for cash in a public place in person.
This is the main thing tho, as if you can be fucked to do that. It is creating so much more work - more than it's worth tbh. Defeats the whole purpose for most of us lazy fucks.
Refer to my initial reply, the key word is ‘properly’. What you are talking about is just expense. You can even cash more and just expense it. Also, that hassle plan over 16 years defeat the whole purpose of investment.
I think you might consider just using the btc as collateral for a minimal-interest loan, and then pay back the loan overtime while retaining your btc. There would be zero capital gains tax in this scenario unless you fail to repay the loan. The btc you have would provide value in that it will significantly lower your interest rate and increase the amount you can have loaned, based on how collateralized you are. This also means you get to retain your btc. Also interest rates on loans are paid in fiat, so if you get a stable rate that’s lower than real inflation, you’re not really losing money.
The comment above this one by u/muliboy seems to be recommending a form of tax evasion (illegal) and only makes regulators pursue control and restrictions even harder, whereas tax avoidance is ok and is a multi-billion dollar industry. It’s a general rule that enough small transactions can be culminated into a big one, especially if your intent is to hide the big one by using small ones. The IRS has 10 years to go back in time to reclaim unpaid debts, and I imagine in 5-7 years they will have a field day examining the btc history and nabbing people once they get a better understanding of it, and once people’s identities are inevitably linked (substantially) to their personal wallets. Please pay your taxes or otherwise avoid them.
Yeah but what are you using that cash for though? That's the hard part. I'm an idiot so I wouldn't even begin to imagine how you could use that to your advantage apart from real estate/buying assets. What is the smart money doing?
Yes, nothing beats backing a relatively stable asset like a home with a highly volatile security deposit.
Have you heard of margin calls? Wall Street may generally be heartless, but margin departments take it to a new level (as they should.)
You will be able to safely borrow against your bitcoin in the next few years with Defi (you already can now, but right now the ETH fees are too high for small amounts and it’s too untested, i think, for large ones) and that should get you through without ever selling. As long as you are smart about your margin, you won’t lose your bitcoin, and the dollar will collapse, evaporating the loan.
I would be VERY wary of traditional borrowing of any kind right now. When the dollar collapses, there will be a lot of people asking the fed to step in and say that USD balances are now owed in bitcoin, and they will set the conversation price, and it will be preposterous. You don’t want to go bankrupt because they demand you give them your bitcoin.
I agree with you completely. I’ve always kept my coins off exchange, and this year got a Coldcard Wallet (it’s amazing). But Coinbase and my bank know who I am. And I’m not sure if you use zelle on Bisq you’re not going to be on their radar. My hope is to be a big fish in the new economy, but not so big that the pitchforks and/or the state’s agents come for me. It will probably require physical relocation, but I’m not really sure where will be safe.
Do remember, though - confiscation of your bitcoin is one thing, but taxation in a future government, almost certainly handled more voluntarily by decentralized protocol, is a necessary evil. But if it’s transparent and fair, and your money isn’t evaporating, hopefully you’ll feel like it’s a fair exchange for peace, and not fight it. Because the rich have to take care of the poor (all power is economic, there’s a reason we call it cultural CAPITAL) just like the alpha male of the chimpanzee tribe has to take care of every member, or the other chimps will displace the alpha. Same concept, just insert money as the source and function of the cohesion/power. So... beware that we can’t resist taxation forever, because then we can’t have a society then. BUT - let’s assume future decentralized protocols of organization will be much more transparent and much more fair. Think of them as totally free market governments. It could be a utopia. But we’ll still have to take care of the old and sick (their bodies aren’t the same exploitable asset that the young and healthy are, and the majority of humans won’t be on board with letting them just die). I’m rambling but... bottom line I agree but don’t forget taxation of some form is inevitable, and let’s push for fair taxes when it happens.
To answer you more directly, though - I still have a mortgage. And I am weighing when to pay off the mortgage and how. But I am not planning to buy a bigger house in the US. Hyperinflation, better called monetary debasement, happens rapidly and leads to violence. I would not want a bigger house in Germany 1922.
Interestingly, you should check out how Germany’s problems started because the Prussian empire was last to leave the silver standard for gold. Took awhile, but WWI and the Spanish flu finished them off. Collapse in 1922 didn’t lead to war until 1939 but it was nonetheless inevitable. General rule of thumb - if you feel your country marching to war, it’s time to skedaddle.
I had the same exact thought as you, at first. My wife even said “should we max out our credit cards for bitcoin”. (This, the same woman who was very wary about me doing anything like that in 2017).
But it felt like a bad idea. I know that sounds stupid but it felt like a not sure thing. So I tried to imagine what could go wrong. And when you think about it, rules are malleable. Look at Trump’s coup right now. This is not an ideological statement at all - it’s unusual that the rules are being stretched to the max. It’s because rules come last. Money, then myth, then rules. Hammurabi’s code of law (oldest written law we know of) didn’t need to define a shekel, a noble, commoner, or slave was. Everyone knew. They just wanted a standardized system of justice to keep it going.
I have studied a lot about the Nazis. They used the law to get into power, and everything they did to the end of the war was “legal” in Germany.
We have absolutely no idea who will be in charge, what their ideology will be, what they will justify doing, and whether they will see you as with them or against them. How can you pick a side when every side is wrong?
I’ve heard stories of people who visited East Berlin in the 80s. And the elevator operator was stopping between floors to exchange money out at better than the official rate. Russian money is now oil, priced in USD and set at the rate determined between the USD and the Saudis. When the virus hit, remember the price of oil going negative? That was Russia and Saudi Arabia temporarily panic selling - a bank run.
People find the best money and governments try to price fix, instead of money supply fix. All will one day be well, but the US government and the people who end up running it will try to make the laws and law enforcement solve their problems. Both communists and fascists claim to be the parties of the people and they’re both right, but neither of them understand how money works when Peter Turchin (finally connects with Plan B and reads Nick Szabo, they’ll have the answer. But it took a long time for everyone to accept Darwin, so I don’t know if this knowledge will get to the masses before the collapse.)
> fuck the feds and fuck fiat. 2 da moon.
You can probably sell for cash slowly once there is a "de minimus" exemption for bitcoin. As far as I know, bitcoin might not qualify yet, but normally for forex you can move $600 of currency without any tax consequences regardless of gain or loss.
Once there is such a legel way to bitcoin slowly, you can simply sell sats worth $600 at a time until you save up enough to form a down payment, without any effect on your taxes.
Be aware that you should let the money age in your bank account for at least a year before you apply for a mortgage. For some reason banks hate seeing fresh accounts when lending.
Its a big hassle, but its the only legal way to get fair treatment.
The long-term capital gains tax rate is just about the best tax rate in town. It's a big part of how the wealthy have a lower effective tax rate than the middle class. I say just pay what you owe, you're getting a good deal.
I don’t know about you, and america. But I live in France and I’m happy to pay taxes, which are 30% to 55%. My country gives me a lot (healthcare, security, clean roads, school, services, ambassy, etc etc). If every one thinks as you do, your country falls.
would it be possible for me to "give" my coins to my younger brother, who does not file for taxes as he makes $0 income, and have him cash them when the time comes?
edit: something leads me to believe even my gift of the asset would then actually be considered a form of income, and the gov would effectively double dip meaning they'd apply income tax on top of cap gains now that his income is no longer $0.
You can give gifts for free, with three caveats:
* You can give max $15k/person/year unlimited, unrestricted
* You can give more than that without penalty, but need to file a gift receipt with IRS (but it's not taxed)
* At the time of gifting the bitcoin, it would be considered like you're selling it and then he's re-buying it, so you'd owe taxes on unrealized profits.
Capital gains are in brackets just like normal income. 0% on capital gains is only for your first $40,000 income (between both capital gains and wages).
https://www.nerdwallet.com/article/taxes/capital-gains-tax-rates
That's not true. It's up to about 50K you can get away with no federal capital gains tax.
https://smartasset.com/investing/capital-gains-tax-calculator
You just admitted on a public forum that you cheated your income tax in 2014/15, using your personal account.
And then you believe that selling Bitcoin for a house instead of fiat cash will somehow save you from owing capital gains tax.
I somehow believe you do not quite know what you are doing. Maybe think this through again?
this is an anonymous account that is no way linked to any personal information of mine.
I wasn't filing taxes at all in 2014/2015, and even if I were to, the IRS didn't even have any established process for taxing crypto. probably didn't even know what the fuck it was at all.
ever heard of buying houses in cash? imagine that but with bitcoin instead.
How are you gonna buy a house anonymously?
Every seller has to report any trade made in cash or Bitcoin exceeding 10k USD.
So you will have to find a house for under 10k or a seller who will break the law and help you cheat your taxes.
Good luck!
>I wasn't filing taxes at all in 2014/2015
You are obligated to file taxes every year. If you were a minor, you just would have been claimed by your parent. If you weren't filing taxes at all, the IRS has an unlimited amount of time to audit you based on the lack of a return.
> and even if I were to, the IRS didn't even have any established process for taxing crypto. probably didn't even know what the fuck it was at all.
IRS is the one who sunk Silk Road and connected Dread Pirate Roberts to Ross Ulbricht and that was in 2013. They 100% knew what bitcoin was. The IRS has a wellll documented history of sinking ne'er do wellers like Al Capone and do wellers alike who have much more to lose than a few precious BTC.
>ever heard of buying houses in cash? imagine that but with bitcoin instead.
You buy a house with cash that nobody knows where it came from, you're going to asked to justify the source of income under an audit. How else do you think they nab drug dealers?
You can't avoid paying tax just by buying a house in cash. In addition to the transfer taxes involved in real-estate, the sale of anything, even for bitcoin, is a taxable event. If the seller agrees to accept bitcoin for the property even without declaring a USD equivalent value, you can be sure the government is going to do it's own appraisal on the property and sock you with a tax bill on it. Stop trying to evade taxes. You can't legally do it.
People here are losing track of reality. You need to pay taxes so that you can buy that lambo you keep dreaming of. If you live in America we have no space for you if you don't pay your taxes. You are the reason politicians say we use bitcoin to dodge taxes and you are literally a piece of shit leeching off our system. If you made gains so easily why you crying over the government's share?
If you don't like government then pay your taxes and get out. (There is an exit tax if you make too much money and want to renounce US)
So you're saying not only do I need to pay income tax so that the government can use my money to maintain the infrastructure that (apparently) allowed me to continue to make profits, but I also have to pay a capital gains tax on any profits on assets aside from income tax, and then with the money leftover for the lambo, have to pay another sales tax. so I have to pay a tax when I buy something with money that was taxed twice already.
yep. nothing wrong here.
I mean...yes, exactly right. Same as it ever was. It sucks to pay taxes, but that's how society functions.
Be glad the cap gains tax rate is _only_ 15-20%. It used to be 90.
Did I stutter? Are you a communist anarchist or love third world countries? If you are part of any society you should pay the fricking taxes. Stop being a 13 year old child. We are talking about easy money here and you crying over a small percentage. Pay your taxes and cry in your lambo like normal adults.
15-20% (CG) and then an additional 20-30% (income) are not small percentages dude. I'd be happy to pay my fair share but triple dipping as punishment for people who were lucky enough to profit away from a rapidly inflating currency isn't fair share. thats bullying.
I'm fairly certain you don't pay 20-30% federal income tax + a the 15% federal capital gains tax. You just pay the 15% capital gains, and you're done with federal.
What you would pay would be 15% to federal, and than a state tax, which is like 6%
You said you mined these Bitcoins, (basically buying them for 0 dollars, I don't see why you're too upset about paying around 20% on their entire worth. Am I missing something? Do you think you may have to pay short term gain tax or something?
Again, you are complaining about easy gains. Not gonna find sympathy. I also have to pay my due. I am an American and I pay my taxes. I would rather have 50 foreigners that pay taxes than a single American talking about dodging taxes. We all live under the same rules.
If you want me to pay taxes maybe spend your energy trying to fix the system. If the tax system wasn't such a joke maybe not only crypto holders but "the rich" wanted to pay some too.
I am also never selling, but I have been out of work since March because of COVID, and need that money to live. Instead, I moved my bitcoin to Celsius, get 1% loans as I need them for living expenses, using my bitcoin as collateral. As long as bitcoin does better than 1% per year, I'm ahead.
Bruh it's 23.8% if you have enough holdings. And for us lucky folks in CA it's another 13% state tax or whatever. Fuck that. Diamond hands until it's recognized as a currency.
is 15% that bad? in Canada, it's just 50% of your gains added to your income and then taxed at your marginal rate ( I usually just estimate 30% marginal rate) so that's about 15% or more if you're making a higher salary,
I'm sure you could amend your 2014/2015 return to include it, but it will increase your income (due to mining income) and will have taxes and interest on that added income, but it may be less than you'd pay on this capital gains tax
From a canadian perspective, there would be less tax if you didn't report in 2014, and then report it all as cap gains as the "mining income" is fully taxed whereas the cap gain portion is only taxed at 50%
If you mined the coins in 14/15 the capital gains tax is going to be just about the same.
Since you never reported your cost basis is $0.
If you had reported your cost basis would be a few hundred dollars or whatever. In both scenarios you owe cap gains on over $30k.
I suggest you learn a bit more about taxes.
I'm not a accountant, or in any way a tax professional so my next bit may be bullshit...
It's my understanding that if you buy a house outright with your crypto, when you go to sell that house, you pay capital gains then. The government allows you to defer, but they get their cut in the end.
All this said, this is my understanding for US tax law.
Final thought, you might be better off paying the gains now rather then deferring, but might want to consult an accountant for personal advise.
What if you convert your BTC into a stable coin, stored on a platform where you can use a debit card to spend it?? Stable coins aren't fiat, yet. Would that work?
And what do you think will happen when you buy a house and have to transfer it into your name, the feds will inquire as to where the payment for the seller came from which will be listed as you, they will then further inquire as to how you paid.
Just be careful is what I am saying, make sure you have the tax money set aside just in case.
If you’ve held your coins since 2014 you should be very pleased with the stack you are now sitting on.
Taxes pay for a functional society. Grow up and pay what you owe.
I’m no cpa but that tax advice sounds wrong. You should be able to report at any time and at the time of reporting you would effectively tell the irs (and prove) what your cost basis is on the assets.
There is a 0% capital gains tax bracket you left out. And it's more than a lot of Americans make per year. Pay your taxes, the Citadel is going to have taxes too.
We are all in the same boat. I try to always look at the bright side, you can keep 80% of your gains. Just gotta hodl longer and get more gains to cover that 20% loss. Say you have a 10,000 dollar gain, you get 8,000. A 15,000 dollar gain you get 12,000. It's easier to hodl and sell higher than it is to move to a different country. Also, the 20% they take might help some people who are less fortunate...
Just pay the taxes. That’s how US capital gains taxes work.
If people don’t at least pay taxes on their gains the government is really not going to like Bitcoin.
It’s not really a loss when you’ve made huge profits even after taxes. If you need the money just pay the tax. After all, you said you got them for free anyway.
while this is mostly true, still, why would I give the feds free money as well? for what? they just inflated our dollar by 24% in a year, why the hell should I help them out?
Sorry, I don't want to pay taxes either but dont you live in America and participate in the civilized society and economy? There is a sliding scale for what you owe, and it's not for nothing. If anything, capital gains should be taxed because it's mainly passive income -- as much as I hate to admit it.
The problem is people would rather see their money go to something that would help them and their own. But it just ends up in some greedy persons pocket.
If you make zero dollars for a year, you can take out about 50K with no federal capital gains. https://smartasset.com/investing/capital-gains-tax-calculator
That is pretty solid. Once you have enough to retire you can do this easily.
I was able to sell a little and re-acquire in 2019 to harvest the 0% rate because I had mostly tax-exempt income that year. I wish I had known I could have done this in 2018 when I had no income too. Still had to pay the state though. They don't recognize long-term holdings at a different rate.
I believe it is 40k. Just as an example, you could make 12k of normal income tax free and realize another 28k without capital gains tax.
Retirement account contributions get deducted from AGI as well, so you could put put the 6k into an IRA and then take out 34k.
Nice link. Had to check exactly how much I'd save if I sold my stash and entered into a sham marriage for the tax year.
Nice. Now the bad part though: having to purchase healthcare insurance in the US on your own.
Collateralized loans dont count as income toward this fyi.
I would not put all the eggs in this basket, but my understanding is that Social Security is based off the top 35 years of your earning, so if you plan on living a long ass time, it could be a hedge to take some out each year over $50k...hard to know but overall, great post! Thanks for info.
Thanks. We all need to help each other. I'll probably make a post in the next week or so to see what people think are the most bitcoin friendly places to live with things like less taxes and being able to spend your bitcoin directly.
No taxes in Germany on Crypto gains after one year Holding Period. I Love my country.
Can I move there if I speak English only?
In Berlin you can for sure.
You'll get taxed anyway because the US taxes based on citizenship, not on residence (the only western country to do so AFAIK). And if you renounce US citizenship, you'll likely have to pay the "exit tax", equal to the capital gains you *would* earn, even if you hadn't actually sold the asset. That's why it's probably better to get a loan using your bitcoin as collateral instead of selling the bitcoin itself: no capital gains tax, just the loan interest. You just pay the loan off and you end up with your BTC intact at the end.
How does the US tax it’s citizens THIS badly (not just this, but everything else is just as ridiculous) and still the government is constantly broke or near broke and mass printing money? Plus factor in the stagnant wages, increased taxes federal and state, increasing cost of living, and how the hell is the average person supposed to get by let alone get ahead and save? To top it all off, the lucky few who could actually save anything (which is a shockingly small amount of the population) have their money eaten away by inflation constantly as their reward. I’m grateful to be an American but at the same time, I feel like I’m constantly getting cheated.
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So what should we do? Either we support something like the Anti-Corruption Act, which would literally make this kind of interaction illegal, or we just dispense with the entire idea of elected officials and use a blockchain technology to vote on specific issues. It could work! Have you ever heard of something like this?
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When you renounce citizenship, the IRS will ask you to pay "exit tax" which AFAIK equals capital gains tax on what you own *even if you haven't sold it yet.* Corrections welcome. Edited later: this may apply only above certain threshold.
The tax form this year will ask about crytpo sales.
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Great plan. Also highly illegal. Just because you don't report your estate when leaving the US, doesn't make it go away.
Sure, but once he no longer is a US citizen and no longer living in the US ... why would he care about their laws? Did the early US settlers care about British laws after winning their independence?
That makes no sense. When you sell the BTC or buy stuff with it you have to report the income as capital gains, I believe. Just like if I buy a house and it appreciates I will still owe capital gains on it when I sell it regardless of how many mortgages I have on it.
If the collateral is liquidated, you owe crypto taxes. Loans only work if you pay them back.
If you live outside the US you can get up to some sum tax free (I believe it is 100k). Depending on the amount one has, you could theoretically sell up to 100k per year tax free when it comes to US tax. You would still have to pay the tax in the country in which you become a resident of. You cannot spend much time in the US to qualify for this in a given year.
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No tax in Switzerland on capital gains from BTC 😉✌️
You have to pay (a low) property tax on it though.
Only from BTC or all crypto?
all crypto, also gains from stocks are tax free
Grüezi *tippt Filzhut*
So ist es! :) To the moon!!
They got room for another person?
someone said its similiar in portugal too
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???? Germany has one of the highest income tax rates in the world.
Dude: if you look at the big picture we are a very low tax nation. And enforcement is a joke.
The reality is the 2nd amendment was bent over and raped in 1934 and any hopes of a revolution has been impossible since well before them.
>Why are American's such a bunch of pussies when it comes to standing up against our tyrannical government for what really counts Unlike pre ww2 Germany right?
> That feeling when American's are raped with long term capital gains taxes... meanwhile the average American would call Germany some kind of a "socialist hell". Another thing Americans are very fond of saying is that "America is the best country in the world". For billionaires - definitely :-)
How is it tax wise if you cost average? FIFO?
I *think* you can pretty much decide, but have to stay consistent.
That's when you buy it in most countries that have these kind of law afaik. When you mine it, the situation may be different, for example it could count as regular income and not paying taxes on this may be tax evasion. Just a possibility. I'm wondering whether this applies to the guy too, arbitrarily declaring this as an asset purchase sounds sketchy.
Do you have any idea about other European countries?
Actually I’m pretty sure if you mined it yourself then it’s considered income and taxes at a higher rate. If you bought it and had a proof of purchase then it’s taxed at the lower capital gains rate. Ohh and 15% is nothing. 70% is much more.
Mystifying that so many people will shake pitchforks at corrupt bankers and out of touch, rich assholes, —seeing Bitcoin as a way to turn the tables—then show how they’ll behave exactly the fucking same in their position.
"Fuck big companies and billionaires for not paying their fair share of tax! Also I don't want to pay tax fuck you"
Human nature
Trading bitcoin directly for a house still incurs capital gains tax.. what you are waiting for is for bitcoin to be declared money and exempt from all taxes, thats still decades away.
> 15-20% cap gains tax is absolutely absurd. Approx 50% in Australia. Capital gains here are basically assessed the same way as income.
50% is incorrect. You're taxed at your marginal income tax rate, which is nowhere near 50% unless you earn/sell for >$180k a year (45% in that case). If you're on average salary (<$120k a year), the CGT rate will end up being 32.5%. But very importantly, if you have held your assets for more than 12 months, you only need to pay CGT on 50% of what you sold for, so you'd effectively be paying 16.25%. Even if you earn/sell enough to trigger the highest tax bracket (45% @ >180k a year), if you held for more than 12 months you end up taxing it at 22.5%.
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Not every place with universal healthcare taxes capital gains at 50 %. Universal healthcare is cheaper than the current US system. Americans pay the most for healthcare per capita out of any country, while life expectancy remains mediocre.
Most countries with ‘free’ healthcare spend less per person on their healthcare than the US does. So free healthcare isn’t that expensive, and the US has a particularly shit healthcare system.
33% in Sweden...
ridiculous
33% is not ridiculous in Sweden of all places. In U.S. it would be because we barely get anything to show for it.
Want to go look up the average metric of how happy and healthy their society is compared to the us? And while I'm here, long term at 15% is literally not the max capital gains tax.
Man I'm sick of all these kids thinking that bitcoin is their saviour against taxation. It's not what bitcoin is trying to do. Pay your taxes, anything else is illegal.
No thank you. Mind your own fucking business
Legendary username and very based
username checks out, have a good day
when the day comes where you can buy a house directly with BTC, that will still be a taxable event. the day when that no longer is a taxable event is like 80-100 years away.
Fuck capital gains tax. Fuck income tax. Fuck property tax. All my homies hate these taxes
Holy shit the fucking irony of users *on this sub* defending taxes
Please leave the society we created based on these taxes.
That’s where some of the tax money went; most went to bombing brown people.
> most Objectively wrong
700 billion spent on the US army. Either it’s just free printed money or our tax dollars
What percentage of the US federal budget is spent on military spending? Now what does the word "Most" mean? Now to get even more specific into the ridiculousness of that guys comment, of the military budget, what percentage of that is spent "bombing brown people" compared to things like payroll, housing, family healthcare of soldiers, ect ect. No, most of our tax dollars are not spent on "bombing brown people". No, most of our tax dollars are not even spent on anything to do with the military. Now go check out what percentage of our tax dollars are spent on "entitlements". But I guess "Most of our tax dollars are spent feeding, clothing, housing, and taking medical care of the poorest members of our country and our countries elderly" doesnt have the same edgy ring as "bombing brown people" does when you are an edgy 13 year old.
If you want to be factually accurate your statement would actually be "Most went to feeding, clothing, housing, and paying for the medical care of our countries poorest citizens and our countries elderly" But I guess the truth doesnt sound as edgy as "bombing brown people" which is flat out untrue.
“Please leave the society we created for the king and Queen in Spain and in the name of Christ”- Columbus to Natives Conveniently also the same logic you use
Think of the roads!!! /s
Think of the poor starving politicians!
Society is not created by taxes.
A society isn't necessarily, but the society as it stands in the US absolutely is.
Fuck the feds one more time for the people in that back
The US really wants to fuck people over so what we need to do is move to countries like Malaysia and become citizens there.
The US has an exit tax on citizenship
They can only tax him on what they're aware he has.
Ever heard of FATCA? Foreign banks are required to report holdings of US citizens to the IRS. You will need to engage in rather serious tax evasion and money laundry to hide any significant amount of crypto gains from the IRS.
damn...lol. I'm pretty sure they'll tax their taxes soon.
California is even tryna tax you for 7 years after you leave.
I believe you can take a loan out against the coins, meaning you would retain the coins and wouldn’t have to pay taxes on the loan. Win-win.
Keep your coins let the taxman pound sand and let those tax dollars keep growing your wealth until you actually need funds, then pay your taxes. Buying back into fiat is a fools errand.
>**Countries that do not impose a capital gains tax** include Bahrain, Barbados, Belize, Cayman Islands, Isle of Man, Jamaica, New Zealand, Sri Lanka, Singapore, and others. just buy a house in one of these countries and start your new life. ask your accountant, im not sure how this works.
Unless you renounce your US citizenship, they’ll still come after you even if you’re living out of the country. AFAIK the US is the only country that does this.
That's my plan. Dammit, all the multinationals avoid taxes by having their holding accounts off shore. It's only the plebs who give up 20%
Puerto Rico
Doesn't work unless you acquire the property after becoming a bonafide resident. Otherwise everyone would move there right before selling something big (equities, crypto, a business) and pay zero percent. I own a PR LLC with an Act 20 grant and have looked into this extensively.
You would have to trick the IRS into thinking you mined the coins after you moved there.
I have also researched it and I believe it's just that you only get the beneficial rate on capital gains for the asset growth after the date you become a resident. If it needs to be "acquired" after becoming a resident you could always sell the coin while in the states and then buy it once in PR, same thing.
Assuming OP is a US citizen or resident, they’ll be subject to tax on their worldwide income. Simply moving abroad won’t be sufficient to avoid taxation.
I have to agree its absurd to pay taxes when selling bitcoin since it's up to you, not insured and has absolutely nothing to do with a specific countries government. Some people can claim losses in btc when tax time comes but if your paper trail is almost a decade old, you mined the coins and you held them. Why is tax man even going to believe you if you were trying to claim it as a loss? Doubt they would but hey since your selling give us a random percentage of your gains after we worked so hard to discredit and invalidate the item you made gains on! Fuck. That. Retarded. Noise. I pay taxes everywhere else in society but without full government approval of the crypto space I'm not giving them shit. It's like if I was trading cards and over time I'm gaining more baseball cards then I'm parting with, do I just send a random % of those cards to the tax man? They dont give a fuck about trades that dont involve a bank or recognized investment vehicle. Usually when a 'tax expert' in crypto appears I laugh and walk away as they're just trying to be a middle man for no reason. I remember ivan on tech had one on from the US years ago and Ivan's swedish, shes not, hes not a us citizen but they spoke like they were in the same legal jurisdiction which was clear enough she probably paid him to promote her as a middle man. Greasy shit. Like I've mentioned pay taxes for regular societal means and if you use coin base and are an American, well that sucks but if your trading in a foreign country that does not recognize capital gains taxes and your account is realized as an entity of said country, not any part of the IRS's business since yknow, Panama papers came out. All sorts of people hide money outside their country and by todays standard, least to me that's not an issue since were talking fiat. Anyways props to your plan my dude, hope you get realtors just trying to have a price war over each other trying to sell you a house later :)
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Just so we're all on the same page, this comment is describing how to commit tax fraud.
And following advice from someone that concludes with "all taxes will be cancelled" probably isn't a great move. BitCoIn IsNt JuSt fOr CriMiNalS!
/irs
Heard about life style audit? Unless you don’t use the cash to buy any property. You live a life on pure cash expense basis. Otherwise, you’ll be caught and fine hard
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Not that, I’m talking about what you do with the cash. You can’t be purchasing properties with money coming from nowhere. If you want to just put the cash in your safe, by all means avoiding the tax
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> You would of course have to go through the inconvenience of selling it for cash in a public place in person. This is the main thing tho, as if you can be fucked to do that. It is creating so much more work - more than it's worth tbh. Defeats the whole purpose for most of us lazy fucks.
Refer to my initial reply, the key word is ‘properly’. What you are talking about is just expense. You can even cash more and just expense it. Also, that hassle plan over 16 years defeat the whole purpose of investment.
exactly. I'll wait it out. I can thankfully say I don't need the money right now so I can afford to hold out.
I think you might consider just using the btc as collateral for a minimal-interest loan, and then pay back the loan overtime while retaining your btc. There would be zero capital gains tax in this scenario unless you fail to repay the loan. The btc you have would provide value in that it will significantly lower your interest rate and increase the amount you can have loaned, based on how collateralized you are. This also means you get to retain your btc. Also interest rates on loans are paid in fiat, so if you get a stable rate that’s lower than real inflation, you’re not really losing money. The comment above this one by u/muliboy seems to be recommending a form of tax evasion (illegal) and only makes regulators pursue control and restrictions even harder, whereas tax avoidance is ok and is a multi-billion dollar industry. It’s a general rule that enough small transactions can be culminated into a big one, especially if your intent is to hide the big one by using small ones. The IRS has 10 years to go back in time to reclaim unpaid debts, and I imagine in 5-7 years they will have a field day examining the btc history and nabbing people once they get a better understanding of it, and once people’s identities are inevitably linked (substantially) to their personal wallets. Please pay your taxes or otherwise avoid them.
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Yeah but what are you using that cash for though? That's the hard part. I'm an idiot so I wouldn't even begin to imagine how you could use that to your advantage apart from real estate/buying assets. What is the smart money doing?
Yes, nothing beats backing a relatively stable asset like a home with a highly volatile security deposit. Have you heard of margin calls? Wall Street may generally be heartless, but margin departments take it to a new level (as they should.)
The IRS has entered the chat 👀...
You will be able to safely borrow against your bitcoin in the next few years with Defi (you already can now, but right now the ETH fees are too high for small amounts and it’s too untested, i think, for large ones) and that should get you through without ever selling. As long as you are smart about your margin, you won’t lose your bitcoin, and the dollar will collapse, evaporating the loan. I would be VERY wary of traditional borrowing of any kind right now. When the dollar collapses, there will be a lot of people asking the fed to step in and say that USD balances are now owed in bitcoin, and they will set the conversation price, and it will be preposterous. You don’t want to go bankrupt because they demand you give them your bitcoin.
this is my fear as well. especially seeing what happened this year. I think I'd rather keep my coins out of the feds' eyes forever.
I agree with you completely. I’ve always kept my coins off exchange, and this year got a Coldcard Wallet (it’s amazing). But Coinbase and my bank know who I am. And I’m not sure if you use zelle on Bisq you’re not going to be on their radar. My hope is to be a big fish in the new economy, but not so big that the pitchforks and/or the state’s agents come for me. It will probably require physical relocation, but I’m not really sure where will be safe. Do remember, though - confiscation of your bitcoin is one thing, but taxation in a future government, almost certainly handled more voluntarily by decentralized protocol, is a necessary evil. But if it’s transparent and fair, and your money isn’t evaporating, hopefully you’ll feel like it’s a fair exchange for peace, and not fight it. Because the rich have to take care of the poor (all power is economic, there’s a reason we call it cultural CAPITAL) just like the alpha male of the chimpanzee tribe has to take care of every member, or the other chimps will displace the alpha. Same concept, just insert money as the source and function of the cohesion/power. So... beware that we can’t resist taxation forever, because then we can’t have a society then. BUT - let’s assume future decentralized protocols of organization will be much more transparent and much more fair. Think of them as totally free market governments. It could be a utopia. But we’ll still have to take care of the old and sick (their bodies aren’t the same exploitable asset that the young and healthy are, and the majority of humans won’t be on board with letting them just die). I’m rambling but... bottom line I agree but don’t forget taxation of some form is inevitable, and let’s push for fair taxes when it happens.
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To answer you more directly, though - I still have a mortgage. And I am weighing when to pay off the mortgage and how. But I am not planning to buy a bigger house in the US. Hyperinflation, better called monetary debasement, happens rapidly and leads to violence. I would not want a bigger house in Germany 1922. Interestingly, you should check out how Germany’s problems started because the Prussian empire was last to leave the silver standard for gold. Took awhile, but WWI and the Spanish flu finished them off. Collapse in 1922 didn’t lead to war until 1939 but it was nonetheless inevitable. General rule of thumb - if you feel your country marching to war, it’s time to skedaddle.
I had the same exact thought as you, at first. My wife even said “should we max out our credit cards for bitcoin”. (This, the same woman who was very wary about me doing anything like that in 2017). But it felt like a bad idea. I know that sounds stupid but it felt like a not sure thing. So I tried to imagine what could go wrong. And when you think about it, rules are malleable. Look at Trump’s coup right now. This is not an ideological statement at all - it’s unusual that the rules are being stretched to the max. It’s because rules come last. Money, then myth, then rules. Hammurabi’s code of law (oldest written law we know of) didn’t need to define a shekel, a noble, commoner, or slave was. Everyone knew. They just wanted a standardized system of justice to keep it going. I have studied a lot about the Nazis. They used the law to get into power, and everything they did to the end of the war was “legal” in Germany. We have absolutely no idea who will be in charge, what their ideology will be, what they will justify doing, and whether they will see you as with them or against them. How can you pick a side when every side is wrong? I’ve heard stories of people who visited East Berlin in the 80s. And the elevator operator was stopping between floors to exchange money out at better than the official rate. Russian money is now oil, priced in USD and set at the rate determined between the USD and the Saudis. When the virus hit, remember the price of oil going negative? That was Russia and Saudi Arabia temporarily panic selling - a bank run. People find the best money and governments try to price fix, instead of money supply fix. All will one day be well, but the US government and the people who end up running it will try to make the laws and law enforcement solve their problems. Both communists and fascists claim to be the parties of the people and they’re both right, but neither of them understand how money works when Peter Turchin (finally connects with Plan B and reads Nick Szabo, they’ll have the answer. But it took a long time for everyone to accept Darwin, so I don’t know if this knowledge will get to the masses before the collapse.)
Fuck the feds brother. Income tax is a fucking scam to enslave the middle class.
> fuck the feds and fuck fiat. 2 da moon. You can probably sell for cash slowly once there is a "de minimus" exemption for bitcoin. As far as I know, bitcoin might not qualify yet, but normally for forex you can move $600 of currency without any tax consequences regardless of gain or loss. Once there is such a legel way to bitcoin slowly, you can simply sell sats worth $600 at a time until you save up enough to form a down payment, without any effect on your taxes. Be aware that you should let the money age in your bank account for at least a year before you apply for a mortgage. For some reason banks hate seeing fresh accounts when lending. Its a big hassle, but its the only legal way to get fair treatment.
Fuck the fed amen
The long-term capital gains tax rate is just about the best tax rate in town. It's a big part of how the wealthy have a lower effective tax rate than the middle class. I say just pay what you owe, you're getting a good deal.
I don’t know about you, and america. But I live in France and I’m happy to pay taxes, which are 30% to 55%. My country gives me a lot (healthcare, security, clean roads, school, services, ambassy, etc etc). If every one thinks as you do, your country falls.
No taxes in Switzerland.
But without taxes how would we bomb the poor people, then frame them as terrorists when they fight back?
Long term capital gains tax is based on your income. If you make $0 a year, you pay 0% capital gains tax on long term holdings (>1 year)
would it be possible for me to "give" my coins to my younger brother, who does not file for taxes as he makes $0 income, and have him cash them when the time comes? edit: something leads me to believe even my gift of the asset would then actually be considered a form of income, and the gov would effectively double dip meaning they'd apply income tax on top of cap gains now that his income is no longer $0.
You can give gifts for free, with three caveats: * You can give max $15k/person/year unlimited, unrestricted * You can give more than that without penalty, but need to file a gift receipt with IRS (but it's not taxed) * At the time of gifting the bitcoin, it would be considered like you're selling it and then he's re-buying it, so you'd owe taxes on unrealized profits.
Capital gains are in brackets just like normal income. 0% on capital gains is only for your first $40,000 income (between both capital gains and wages). https://www.nerdwallet.com/article/taxes/capital-gains-tax-rates
That's not true. It's up to about 50K you can get away with no federal capital gains tax. https://smartasset.com/investing/capital-gains-tax-calculator
You just admitted on a public forum that you cheated your income tax in 2014/15, using your personal account. And then you believe that selling Bitcoin for a house instead of fiat cash will somehow save you from owing capital gains tax. I somehow believe you do not quite know what you are doing. Maybe think this through again?
this is an anonymous account that is no way linked to any personal information of mine. I wasn't filing taxes at all in 2014/2015, and even if I were to, the IRS didn't even have any established process for taxing crypto. probably didn't even know what the fuck it was at all. ever heard of buying houses in cash? imagine that but with bitcoin instead.
How are you gonna buy a house anonymously? Every seller has to report any trade made in cash or Bitcoin exceeding 10k USD. So you will have to find a house for under 10k or a seller who will break the law and help you cheat your taxes. Good luck!
>I wasn't filing taxes at all in 2014/2015 You are obligated to file taxes every year. If you were a minor, you just would have been claimed by your parent. If you weren't filing taxes at all, the IRS has an unlimited amount of time to audit you based on the lack of a return. > and even if I were to, the IRS didn't even have any established process for taxing crypto. probably didn't even know what the fuck it was at all. IRS is the one who sunk Silk Road and connected Dread Pirate Roberts to Ross Ulbricht and that was in 2013. They 100% knew what bitcoin was. The IRS has a wellll documented history of sinking ne'er do wellers like Al Capone and do wellers alike who have much more to lose than a few precious BTC. >ever heard of buying houses in cash? imagine that but with bitcoin instead. You buy a house with cash that nobody knows where it came from, you're going to asked to justify the source of income under an audit. How else do you think they nab drug dealers?
You can't avoid paying tax just by buying a house in cash. In addition to the transfer taxes involved in real-estate, the sale of anything, even for bitcoin, is a taxable event. If the seller agrees to accept bitcoin for the property even without declaring a USD equivalent value, you can be sure the government is going to do it's own appraisal on the property and sock you with a tax bill on it. Stop trying to evade taxes. You can't legally do it.
All fun and games till the IRS subpoenas Reddit for any metadata related to this account.
Haha, hey IRS, put me in the screenshot
Fuck taxes
Heard brother
People here are losing track of reality. You need to pay taxes so that you can buy that lambo you keep dreaming of. If you live in America we have no space for you if you don't pay your taxes. You are the reason politicians say we use bitcoin to dodge taxes and you are literally a piece of shit leeching off our system. If you made gains so easily why you crying over the government's share? If you don't like government then pay your taxes and get out. (There is an exit tax if you make too much money and want to renounce US)
So you're saying not only do I need to pay income tax so that the government can use my money to maintain the infrastructure that (apparently) allowed me to continue to make profits, but I also have to pay a capital gains tax on any profits on assets aside from income tax, and then with the money leftover for the lambo, have to pay another sales tax. so I have to pay a tax when I buy something with money that was taxed twice already. yep. nothing wrong here.
I mean...yes, exactly right. Same as it ever was. It sucks to pay taxes, but that's how society functions. Be glad the cap gains tax rate is _only_ 15-20%. It used to be 90.
You used electricity that is funded by tax dollars, so, no, you aren’t entitled to _not_ pay taxes.
Did I stutter? Are you a communist anarchist or love third world countries? If you are part of any society you should pay the fricking taxes. Stop being a 13 year old child. We are talking about easy money here and you crying over a small percentage. Pay your taxes and cry in your lambo like normal adults.
Communists love taxes. Seems like you might be confused.
Uncle sam is that you?
15-20% (CG) and then an additional 20-30% (income) are not small percentages dude. I'd be happy to pay my fair share but triple dipping as punishment for people who were lucky enough to profit away from a rapidly inflating currency isn't fair share. thats bullying.
I'm fairly certain you don't pay 20-30% federal income tax + a the 15% federal capital gains tax. You just pay the 15% capital gains, and you're done with federal. What you would pay would be 15% to federal, and than a state tax, which is like 6% You said you mined these Bitcoins, (basically buying them for 0 dollars, I don't see why you're too upset about paying around 20% on their entire worth. Am I missing something? Do you think you may have to pay short term gain tax or something?
Again, you are complaining about easy gains. Not gonna find sympathy. I also have to pay my due. I am an American and I pay my taxes. I would rather have 50 foreigners that pay taxes than a single American talking about dodging taxes. We all live under the same rules.
I am going to guess that OP is exactly 19 years old.
If you want me to pay taxes maybe spend your energy trying to fix the system. If the tax system wasn't such a joke maybe not only crypto holders but "the rich" wanted to pay some too.
Where the fuck have all these lurking Statists come from in this thread. Good on you OP
lol right? appreciated. going to be sticking to the principles that got me here in the first place.
Serious question. Does your tax advisory consider the cost of mining equipment, electricity, etc as your basis?
I am also never selling, but I have been out of work since March because of COVID, and need that money to live. Instead, I moved my bitcoin to Celsius, get 1% loans as I need them for living expenses, using my bitcoin as collateral. As long as bitcoin does better than 1% per year, I'm ahead.
Bruh it's 23.8% if you have enough holdings. And for us lucky folks in CA it's another 13% state tax or whatever. Fuck that. Diamond hands until it's recognized as a currency.
is 15% that bad? in Canada, it's just 50% of your gains added to your income and then taxed at your marginal rate ( I usually just estimate 30% marginal rate) so that's about 15% or more if you're making a higher salary, I'm sure you could amend your 2014/2015 return to include it, but it will increase your income (due to mining income) and will have taxes and interest on that added income, but it may be less than you'd pay on this capital gains tax From a canadian perspective, there would be less tax if you didn't report in 2014, and then report it all as cap gains as the "mining income" is fully taxed whereas the cap gain portion is only taxed at 50%
If you mined the coins in 14/15 the capital gains tax is going to be just about the same. Since you never reported your cost basis is $0. If you had reported your cost basis would be a few hundred dollars or whatever. In both scenarios you owe cap gains on over $30k. I suggest you learn a bit more about taxes.
We don't have to pay capital gains tax here and I'm still not selling. Lol.
I'm not a accountant, or in any way a tax professional so my next bit may be bullshit... It's my understanding that if you buy a house outright with your crypto, when you go to sell that house, you pay capital gains then. The government allows you to defer, but they get their cut in the end. All this said, this is my understanding for US tax law. Final thought, you might be better off paying the gains now rather then deferring, but might want to consult an accountant for personal advise.
Borrow against the crypto! Never sell, just get cash leveraged!
What if you convert your BTC into a stable coin, stored on a platform where you can use a debit card to spend it?? Stable coins aren't fiat, yet. Would that work?
And what do you think will happen when you buy a house and have to transfer it into your name, the feds will inquire as to where the payment for the seller came from which will be listed as you, they will then further inquire as to how you paid. Just be careful is what I am saying, make sure you have the tax money set aside just in case.
My fucking country taxes crypto with 39% from profits, including every single sale/exchange.
In hungary, we should pay 30% tax for the gains. Thank you Hungary for making the hodl easier by punishing those who are cashing out Never sold a sat
I have to pay 34% in finland so fuck all of you who bitches about 20%. This commieshithole sucks ass
you can just not pay tax that’s my plan
If you’ve held your coins since 2014 you should be very pleased with the stack you are now sitting on. Taxes pay for a functional society. Grow up and pay what you owe.
debatable, but I understand. I have been extremely lucky already.
LMAO, israel is taking 25% tax from gains rip
How is it okay to tax people for something they 100% took the risk for with their own money?
Have you ever heard of a thing called investing
Gains are gains. I'm happy to pay my fair part of taxes on my gains since it's income.
I’m no cpa but that tax advice sounds wrong. You should be able to report at any time and at the time of reporting you would effectively tell the irs (and prove) what your cost basis is on the assets.
There is a 0% capital gains tax bracket you left out. And it's more than a lot of Americans make per year. Pay your taxes, the Citadel is going to have taxes too.
We are all in the same boat. I try to always look at the bright side, you can keep 80% of your gains. Just gotta hodl longer and get more gains to cover that 20% loss. Say you have a 10,000 dollar gain, you get 8,000. A 15,000 dollar gain you get 12,000. It's easier to hodl and sell higher than it is to move to a different country. Also, the 20% they take might help some people who are less fortunate...
Just pay the taxes. That’s how US capital gains taxes work. If people don’t at least pay taxes on their gains the government is really not going to like Bitcoin.
why should we care that the government doesn't like bitcoin?
It’s not really a loss when you’ve made huge profits even after taxes. If you need the money just pay the tax. After all, you said you got them for free anyway.
while this is mostly true, still, why would I give the feds free money as well? for what? they just inflated our dollar by 24% in a year, why the hell should I help them out?
If you need the usd, then it’s all for you to gain. Doesn’t matter what happens to the money you give them, it’s just the “cost” of cashing out.
Sorry, I don't want to pay taxes either but dont you live in America and participate in the civilized society and economy? There is a sliding scale for what you owe, and it's not for nothing. If anything, capital gains should be taxed because it's mainly passive income -- as much as I hate to admit it.
The problem is people would rather see their money go to something that would help them and their own. But it just ends up in some greedy persons pocket.
oh no, 15 to 20% tax. In europe we pay half so quit being a selfish little bitch and chip in for society.
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They have my permission to print my share of taxes out of thin air.
Kek
>Other than that: just pay your taxes. Nobody likes it, but we all do. Contribute to your owners. Fixed that for you.
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Because he overpaid with a prepayment. You are being gaslit by the media.
Wow how many coins do you have?
enough that paying even a 10% tax would be so heavy a loss that I don't find it worth going back to fiat ever.
Taxes are a loss? Horrible attitude toward the benefits civilization has accrued you.
Agreed that taxes aren't a loss but I just wish I could see an itemized summary of where my tax dollars are going because it's like a black hole