Cryptocurrencies and Taxes

[userque]

If you own bitcoin, here’s how much you owe in taxes
https://www.cnbc.com/2018/01/25/if-you-own-bitcoin-heres-how-much-you-owe-in-taxes.html
(VIDEO)​

"...

As far as Uncle Sam is concerned, bitcoin is not currency. It's property. That means whenever you buy something with bitcoin, it's two transactions, not one. ...

For many, though, bitcoin is just an investment. If you've held those bitcoins for less than a year and sell them, that cash will be taxed as income. If you've held for more than a year, it's taxed as a capital gain — which could run 20 percent. Adding on transaction and accounting fees could raise costs to 60 percent, as was the case for one early bitcoin adopter.

..."

 

[bmneveu]

Is this a percentage of the profit, or a percentage of the total value of the asset?

If you own bitcoin, here’s how much you owe in taxes
https://www.cnbc.com/2018/01/25/if-you-own-bitcoin-heres-how-much-you-owe-in-taxes.html
(VIDEO)​

"...

As far as Uncle Sam is concerned, bitcoin is not currency. It's property. That means whenever you buy something with bitcoin, it's two transactions, not one. ...

For many, though, bitcoin is just an investment. If you've held those bitcoins for less than a year and sell them, that cash will be taxed as income. If you've held for more than a year, it's taxed as a capital gain — which could run 20 percent. Adding on transaction and accounting fees could raise costs to 60 percent, as was the case for one early bitcoin adopter.

..."

 

[userque]

Is this a percentage of the profit, or a percentage of the total value of the asset?

My guess is a percentage of the 'gains' ... or profit.

 

[bmneveu]

What if I buy cryptocurrency with my tax refund? Are they going to tax my crypto that I bought with taxes? (sadly yes, and I do plan to put a good chunk of my return into crypto).

 

[userque]

What if I buy cryptocurrency with my tax refund? Are they going to tax my crypto that I bought with taxes? (sadly yes, and I do plan to put a good chunk of my return into crypto).

My guess is that they will ... if you sell them and have gains that year.

 

[userque]

FYI (From an anonymous reddit poster):

"...

So, I started with ~100k, made ~900k, lost 450k in January, and now will have to pay 450k in taxes. Everything is gone.

..."

Full post here:
https://www.reddit.com/r/btc/comments/7ve4uf/i_have_lots_of_money_but_im_about_to_have_nothing/

 

[userque]

(VIDEO) Barely anyone is paying the taxes they owe on their bitcoin gains
https://www.cnbc.com/2018/02/13/bar...he-taxes-they-owe-on-their-bitcoin-gains.html