Re:The IRS Sets a Trap for Cryptocurrency Tax Cheats
by Thorrez on Sunday September 27, 2020 @01:03AM
(#24604355)
>Paying an invoice? Never considered that!
If you pay an invoice with bitcoins that have experienced capital gains, you have to pay capital gains tax.
>Tax deductible transaction? With crypto huh, never asked!
What is a tax deductible transaction? If you donate bitcoins to a charity by sending the bitcoins to the charity's bitcoin address that is indeed fully tax deductible and you don't need to pay capital gains tax (and you get an income tax deduction of the entire value). But is coinbase really trying to get you to pay capital gains tax when you simply send bitcoins from one address to another? That doesn't make sense.
>Receiving crypto for services rendered?
How does receiving crypto have anything do do with capital gains? Capital gains come into play only when you get rid of the crypto.
>The asset doesnt matter, only the nature of the transaction matters
Yes, and any time you exchange cryptocurrencies for something else (dollars, goods, services) that is a capital gains relevant transaction.
If you pay an invoice with bitcoins that have experienced capital gains, you have to pay capital gains tax.
>Tax deductible transaction? With crypto huh, never asked!
What is a tax deductible transaction? If you donate bitcoins to a charity by sending the bitcoins to the charity's bitcoin address that is indeed fully tax deductible and you don't need to pay capital gains tax (and you get an income tax deduction of the entire value). But is coinbase really trying to get you to pay capital gains tax when you simply send bitcoins from one address to another? That doesn't make sense.
>Receiving crypto for services rendered?
How does receiving crypto have anything do do with capital gains? Capital gains come into play only when you get rid of the crypto.
>The asset doesnt matter, only the nature of the transaction matters
Yes, and any time you exchange cryptocurrencies for something else (dollars, goods, services) that is a capital gains relevant transaction.