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Coinbase Ordered To Report 14,355 Users To the IRS (theverge.com)
Nearly a year after the case was initially filed, Coinbase has been ordered to turn over identifying records for all users who have bought, sold, sent, or received more than $20,000 through their accounts in a single year. The digital asset broker estimates that 14,355 users meet the government's requirements. The Verge reports: For each account, the company has been asked to provide the IRS with the user's name, birth date, address, and taxpayer ID, along with records of all account activity and any associated account statements. The result is both a definitive link to the user's identity and a comprehensive record of everything they've done with their Coinbase account, including other accounts to which they've sent money. The order is significantly narrower than the IRS's initial request, which asked for records on every single Coinbase user over the same period. That request would also have required all communications between Coinbase and the user, a measure the judge ultimately found unnecessarily comprehensive. The government made no claim of suspicion against individual users, but instead argued that the order was justified based on the discrepancy between Coinbase users and U.S. citizens reporting Bitcoin gains to the IRS.
They told me cryptocurrencies were anonymous :^)
Make ONE association of a transaction to an individual, and then you have ALL transactions that individual has ever made, all recorded. It won't just be a single year that can be checked, it will be all years, from any source. The fatal flaw of blockchain is that all transactions are 100% traceable, and each transaction uses an identifer that is unque - and consistent - to a single user. Crack that association once - and it's cracked for all time, past, present and future. Cash is still anonymous ...
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
It's the IRS, lol. Those miners about to be taxed, hope they didn't spend it all - they might need some of it + penalties.
I signed up for a Kraken and Gdax (aka Coinbase) account lately and between the two I needed a live pic of my license, pic of me holding my driver's license, my social, my full name, a scan of my license, a pic of me holding my signature, etc. They comply with the banking secrecy act or they get shut down (like Tradehill). So because I had to give them all this, I report all my income in Quickbooks at my company where I run 4 giant mining rigs. So don't just assume all of us are tax evaders as most of us are not.
All coinbase users must be tax evaders simply because ... uh ... uh ... Okay well not ALL users just the ones who bought more than $20k because that sounds like a really big number to [edited] people who are afraid of spooky numbers and computers and stuff
Actually, given the figures, that's not that unreasonable. The estimated figures say under 900 users reported bitcoin earnings from 2013-2015, during which time 14,000 users at Coinbase sold, sent or received more than $20k worth. Now, clearly not all of those users are committing tax fraud. But that's not the point of a tax probe. It's likely that enough are to make a review worth it. Transactions of that magnitude are routinely monitored in the world.
-Daniel
I thought transactions that are "Paid-In-Kind" are exempt. Money for money should not be taxed.
The IRS would argue that bitcoin is not money. It's no different than if you bought and sold gold coins for a monetary gain. You owe tax on the gains.
and the IRS jail you for cheating on your taxes!
That's no joke. The US Government considers cheating on taxes to be a very serious offense. In fact, the tough penalties for tax crimes are so well known that prosecutors sometimes elect to go after the tax charges, rather than other chargeable offenses, because the penalties are so much higher. There was a case in Las Vegas some years back where instead of busting a pimp for running prostitutes, which had a 2 year prison sentence, they prosecuted the guy for tax evasion because he didn't declare and pay taxes on his pimping income and he got 30 years for that instead. This wasn't an accident. The authorities didn't like the guy and wanted him off the streets, so they used the tax charges to put him away for a long time and didn't even bother with the pimping charges.
As long as money is being exchanged for money that has equal value it should not be taxed. If you pay $5 USD and receive the equivalent value of $5 USD in BTC then there's nothing to tax.
However, if you spend $5 USD and received $10 USD worth of BTC then you should be reporting the difference of $5 USD as income. Further, if you purchase $5 USD worth of BTC with $5 USD and the value of BTC relative to USD rises so your $5USD worth of BTC is now $500 USD worth of BTC then you would be required to file the difference ($495 USD) as income once you no longer possess the BTC unless the method by which you lost possession of the BTC is not due to theft, loss, or purchasing an item worth $500 USD or less. If you bought something worth $1000 USD with your BTC now worth $500 USD you would have to report $500 as income.
The IRS has a very keen interest on getting the transactional records of individuals who are doing things in BTC because by their definitions there's plenty of opportunity there for tax evasion.
"Lack of speed can be overcome. In the worst case by patience." --Znork
or:
Cash out in tax haven. Don't repatriate the money.
Problem solved.
If you were on a platform and a US resident, then open a swiss or german bank account, have the cash-out in Francs or Euros and deposited into said account.
Declare the account on your IRS statement (required by tax code, so they can identify if you move the money into the US)
Pay no taxes on that money as long as it's not sent into or spent in the US.
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You're an idiot.
Alleged democracies, like the us, belong to "we, the people", and use our tax dollars for provide things.
And if *you* don't want to pay taxes, then get the fuck off the highways *my* taxes paid for, don't walk on the street *my* taxes paid for, don't use city water or sewer. In fact, get the hell out of the country that *my* taxes paid for.
And take your guns with you, to protect you against any invading army., navy, or air force.