Slashdot Mirror
Coinbase: We Will Send Data On 13,000 Users To IRS (arstechnica.com)
Coinbase has formally notified its customers that it will be complying with a court order and handing over the user data for about 13,000 of its customers to the Internal Revenue Service. Ars Technica reports: The case began back in November 2016 when the IRS went to a federal judge in San Francisco to enforce an initial order that would have required the company to hand over the data of all users who transacted on the site between 2013 and 2015 as part of a tax evasion investigation. Coinbase resisted the IRS' request in court. But by November 2017, after a hearing, U.S. Magistrate Judge Jacqueline Scott Corley narrowed the request to only cover 13,000 particular individuals. The San Francisco-based startup is now required to provide "taxpayer ID, name, birth date, address, and historical transaction records for certain higher-transacting customers during the 2013-2015 period." Coinbase reminded its users that it is "unable to provide legal or tax advice." The company also noted, "If you have concerns about this, we encourage you to seek legal advice from an attorney promptly. Coinbase expects to produce the information covered by the court's order within 21 days."
Uh-oh. I think that some dumb people are going to be in a lot of trouble.
I don't respond to AC's.
... are a security vulnerability." - Nick Szabo.
Usable decentralized exchanges are almost here.
My God, it's Full of Source!
OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
Then you would have to pay the tax on the gain. Once you convert it into something else of value then the tax comes due.
Can I declare a capital loss on all those dollars that I converted into Bitcoin? Back when the dollar market dropped right through the floor back last December?
Ask an accountant (or better yet a tax attorney) but if you can, you can only declare them once you realize the loss (ie convert them back to usd) There are still questions about whether the wash rule applies or not so to be absolutely safe you'd need to not buy any bitcoins for at least 30 days.
You have to consider this from a non-first world point of view. How would you like to have had your money tied up in Zimbabwe dollars when the inflation rate hit 1,000,000 percent? Many places in the world either to do not have trusted third parties for exchange or the price is exorbitant for the regular person. Cryptocurrency is a possible solution for these people.
I can't decide if you were misspelling "attic" or "arctic". Either one works for me.
You are welcome on my lawn.
Honest question... are you sure? Normally that kind of transaction (like an option) would just track as basis changes if done properly.
What the IRS really needs is evidence and they have none. They better not waste my time with this BS in later years.
The whole point of the demand for details is to check if their is evidence of tax evasion. The IRS can audit anyone at anytime, they don't need evidence, the audit is to determine if there is evidence.
It was vague, but a new law was passed that as of Jan 1 2018, it's clarified to always be a taxable event. (thanks Trump for raising taxes!)
Banks already have to do this to fight "money laundering" and "financing terrorism" (in actual reality, this is purely about tax evasion...) and companies like Coinbase are in some sense banks. They have no chance to deny such a request and, unless the cryptocurrency in question has strong anonymity (like Monero) and you are always strongly anonymized when accessing it or use your own wallet exclusively, there is no way the feds will not identify you eventually.
I am beginning to think that all this hype could have been about (really stupid, but rich) people trying to evade taxes and that the speculation angle actually is kind of a side-show.
Most ACs are not even worth the keystrokes to insult them. Be generically insulted by this and ignored otherwise.
For your first question, this is actually an obligation for all payment institutions and banks. There is a legal obligation to collect information on the client (Know Your Client/Know Your Business). Once a certain threshold in transactions value is crossed, that information needs to be validated and additional information needs to be collected (proof of ID, proof of address). There is also an obligation to run the collected data against sanction lists on a regular basis (daily/weekly, depending on risk exposure).
For your second question, if the details do not check out once the lowest threshold is hit or the details raise a hit on a sanction list... the institution has the legal obligation to seize the funds, sneaky freeze the account and immediately report the suspicious activity to the financial authorities. I used "sneaky freeze" because they can't actually alert you of their suspicion, as that would be considered "tipping off" and expose them to penalties (fines, potential jail time for the party tipping off).
So, are you and shanen the same person, or are you both robots shilling the same propoganda, or are you just trying to boost your karma rating by copypasting someone elses reply and tacking it onto a top level comment?
"When life gives you lemons, don't make lemonade. Make life take the lemons back!" -- Cave Johnson
I can think of a reason: There is no international money transfer method that is simultaneously affordable, fast and secure:
Paypal Is affordable and fast, but is not secure. They can freeze your founds for whatever reason they want to.
Swift transactions and wire transfer services like western union are expensive and bothersome.
CC are expensive and insecure, and not accessible to everybody qualifies for them
Maybe there are other alternatives I don't know of, but cryptocurrencies as a means of exchange, if successful, should introduce competition and lower the CC tax.
If you want to avoid the IRS it is profoundly dumb to do business with a US company.
Same as if you want to avoid the NSA, or the FBI, or the MAFIAA, or whatever.