Coinbase is under pressure from the United States IRS to release all
customer account data. Their demands are based on IRS need to catch
those coin base members trying to avoid paying taxes.
My original idea to take you through how to use coin base took a back
seat when the whole system hit the net big time with the fast rise of the
value of a bitcoin.
The Bitcoin dollar value rise has definitely taken a back seat to this
latest IRS news that will hit every user this tax season.
Coinbase claims over 5.9 million customers, exchanging over $6 billion
exchanged in bitcoin.
Quote: “The IRS also claims that “in the 30-day period ending December
14, 2015, Coinbase was the fourth largest exchanger 25 globally of bitcoin
into U.S. dollars and the largest exchanger in the U.S. of bitcoin into U.S.
dollars.”
[Editors Note: ” … largest exchanger 25 globally of bitcoin
into U.S. dollars …” refers to quoter’s exchange rate for 25.00 Bitcoin (BTC)
to United States Dollar.]
Pretty impressive numbers which might be why the IRS claims it needs the
account/wallet/vault registration and all your private login information.
From all reports, their intentions are to prove you are cheating the
system by not completing correct tax returns.
If you fall into this category, believing bitcoins are not taxable, you are
only half right. The coins are not taxable because they have NO legal
tender value in any jurisdiction.
However, once the bitcoins, or satoshi leading up to full bitcoin, or
the coins purchased for investment purposes, or just for cash or for
paying bills were converted, that is another story.
IRS wants their blood money
Is it blood money or the rights of the American establishment to
expect all users of any form of legal tender to pay their fair share?
Remember, from satoshi to Bitcoin gathering, they are not legal
tender. Once the satoshi and bitcoin were converted into cash, then it
is open to tax laws.
While the IRS has been pushing since 2013, the first year all data was
being sought from Coinbase, the apparent lack of clarification over
the tax treatment of digital currencies like Bitcoin created a serious
problem.
Every post I read all over the net implied Bitcoins would make
the best payment processor and could not be touched by the
IRS. Misleading rumors are a foolish way to promote the actions
or the future use of Bitcoins and our accountability to EACH
country tax structure.
In 2014, the IRS, five years after Bitcoin came on the markets,
the IRS issued guidance (Notice 2014-21, downloads as a pdf)
on the treatment of virtual currency.
The IRS determined that Bitcoin and similar currencies are to be
treated as a capital asset. That means that for those buying and
selling Bitcoin as an investment, calculating gains and losses are
figured the same as buying and selling stock.
Well, that is not your intention, I presume, as your interest would
be in how to convert your efforts for cash. That puts you back to
square one. Now you are entering taxation laws and rules where
you must declare your earnings.
To recap …
– NO IRS guidance in 2013
– 2014 release of guidance
– In 2016, IRS shocked at taxpayer inconsistency to report.
The IRS claim it must be because those taxpayers who failed to
file their income tax reports must be cheating.
Author disclaimer: While I have tried to make this article plain
enough for all levels of readers to understand, there is more.
There is always more, thus there are several links inclusive to
help you wade through my efforts to explain content.
Till next time…
Your Editor
Fran Klasinski
Skype – Fran.klasinski
www,fransfranticmarketing.com
© 2017, Fran Klasinski. All rights reserved. on republishing any parts of this post, you must supply a link to the original post
