So it has been said many times, PAY YOUR TAXES! And to everyone I say...Yes, do pay your taxes. I know, not what you expected. Well lets get down to it. According to the IRS "Virtual currency is treated as property for U.S. federal tax purposes." Which means you don't need to pay yearly tax on income because its not currency its property. Some people say this is not true because it is like investing in stock. Except the only problem with that is that stock is defined as "Personal Property," (Personal property includes vehicles, farm equipment, jewelry, household goods, stocks, and bonds) (Real-Estate-FindLaw.) So it can't be treated the exact same, however when you sell your stock you sell it with a tax on capital gains. However, when selling cryptocurrency you sell it for other cryptocurrency. The only time you need to pay tax is when you switch to government controlled currency (ie. Federally Backed Currency.) A good example of this is when someone buys an expensive watch from amazon for a cheep price and sells it on ebay for a much higher value, they don't pay capital gains. Now lets say you didn't switch to USD. It is like switch a newly bought pen for an old pair of shoes, there can be no taxable event on that as it is a person to person transaction where as no government is backing the verification of the transaction. It is the same with crypto. They are saying they want us to pay for each individual change in currency, even when we don't switch back to USD. HOW THE FUCK DO WE PAY YOU! Would you like some of my FUCKING ETHEREUM! What are they going to do make a government wallet and make us pay every time we want to do a transaction. For fuck sake. If you don't turn back into USD there is no legal reason for them to tax you, because it is purely legal for people to do a peer to peer transaction at any price they choose. Think of when you gave your family member that gift card last christmas, did you have to pay tax to just give her the card. No, that's absurd. Yes the first and last time you are in crypto you NEED to pay taxes. But between there, there is NO reason what so ever the government is able to tax you. Offer me one reason. Lets take virtual game items for an example. My friend, these items are the exact same concept. They are a form of currency that is related to the value upon a dollar. When have you heard of people paying tax for a new game item... they don't. If you have any good points put them down below and hopefully we can get some information stirring.
Disclaimer: If legal codes attack you for not paying taxes it is not my fault, this was just a rant on why there codes are ridiculous and completely un-American. I'm all for taxes because they help build communities. But when they throw random as tax laws on shit they should not be aloud to tax, it pisses me the fuck off.
Real-Estate Findlaw:
http://realestate.findlaw.com/owning-a-home/types-of-property-for-tax-purposes.html
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