Almost No People Pay Taxes on Profit in Bitcoin

Discussion in 'About crypto currencies' started by andengireng, Feb 19, 2018.

  1. andengireng

    andengireng Member

    Credit Karma Tax says that fewer than 100 of the 250,000 federal tax returns prepared and submitted so far this year by its customers include reports of the benefits of cryptocurrency and losses.

    Part of the reason for the lack of filing - especially for a year that sees investor interest in the surge in cryptocurrencies - is that any trade and purchase using digital currency is considered to be taxed by the IRS.

    The independent cryptocurrency investor Brandon Williams says the volume and volatility of cryptocurrency takes at least three or four hours every two weeks to record trade gains and losses.

    Only a small percentage of Americans report their cryptocurrency transactions to the IRS, according to a study from Credit Karma Tax. Less than 100 of the 250,000 federal tax returns prepared and submitted so far this year through the company have filed Forms 8949 for the benefits of cryptocurrency and losses, Credit Karma said on Tuesday.


    It shows that less than 0.04 percent of taxpayers. "Generally, Americans with a more complicated tax situation are then in the tax season, especially if they expect their money to be owed," General Tax Manager Karma Tax Jagjit Chawla said in a statement.

    "However, given the popularity of Bitcoin and other crypto currencies in 2017, we expect more people to report it." The company says 52 percent of its poll tax is millennium, and only 14 percent are at least 55 years old.

    Investors' interest in bitcoin and other crypto currencies in circulation keeps the price up several thousand percent higher. The lack of cryptographic tax filing "emphasizes the difficulty of reporting your profits and losses accurately," said Brandon Williams, a former investment banker who has independently traded cryptocurrency for the past two years.

    Williams said that he executes more than two cryptocurrency trades a day, and uses an online service called CoinTracking to record the transaction for tax purposes.

    The volume and volatility of cryptocurrency takes at least three or four hours every two weeks to record trade gains and losses, Williams said. IRS treats cryptocurrencies as properties rather than currencies.

    As a result, transactions such as bitcoin trading for other digital coins will be taxed as a sale of property for cash, which is then used to purchase another crypto. Revenues from bitcoin production through the "mining" process are also taxable, the IRS said.

    Williams said it would make more sense to him if cryptocurrency was treated as currency, and his term as property "is almost a deterrent in the pursuit of mainstream adoption."

    In addition, Williams will also "wait closer to April to file a case if there is more visibility and definition of the IRS about what is acceptable."

    IRS representatives say that nothing can be added outside the guidelines published on its website. About 1 million people filed taxes through Credit Karma when it launched its free tax service last year, the company said.

    It added that Credit Karma Tax is the fifth largest e-filing service. A survey of Lendedu and conducted by Pollfish in November found that slightly more than a third of respondents did not plan to report their bitcoin transactions to the IRS.

    About 64 percent of the 564 adult Americans who responded said they planned to report or have reported their bitcoin transactions.
     
  2. NewbieTrader

    NewbieTrader Member

    I think it is not almost. I think none of them are paying any taxes :p
     
  3. Tengkorakfx

    Tengkorakfx Active Member

    haha why do you think so?
     
  4. NewbieTrader

    NewbieTrader Member

    because in some countries, the regulators don't even understand how bitcoin works so how could they make rules about bitcoin tax? and how do you control the use, the account, etc. too much tech work for them :D
     
  5. Tengkorakfx

    Tengkorakfx Active Member

    That's why some countries ban the usage of bitcoin and other cryptocurrencies since they earn no taxes from them. Even some can see people's bank account but they can't tell exactly where the money are coming from...
     
  6. NewbieTrader

    NewbieTrader Member

    how about our country? hahahah
    yeah, they say it can be a tool of money laundering. but the truth is that they're just envious for not making profit from taxes :D
     
  7. Tengkorakfx

    Tengkorakfx Active Member

    as far as I know, our country does not ban bitcoin, but the government is warning to use bitcoin because it has no official regulation. But for me it is not a big deal as long as it is not prohibited and I still can transact well. hehe
     

Share This Page