Bitcoin and the IRS

[Truckertrash]

So I just read an article that came up on my news feed regarding the IRS going after people using bitcoin. I’m sure it’s obviously targeting people who are actually making a profit, but sounds worrisome at the least. The article stated that using bitcoin to purchase goods and services is taxable. Is this something to be concerned about? I have never claimed that I have used bitcoin on a tax return. If someone were to be audited, how would I explain what goods or services that I purchased? Blow and hookers?? Lol. Hopefully some people who are knowledgeable on this matter could chime in.

 

[Masterofron]

Assuming you use bitcoin to purchase illegal substances (steroids) you have nothing to worry about. Actually unless your buying something with bitcoin like a car for example, you have nothing to worry about. Nobody buys a car with bitcoin so that example is extreme, but I’m sure you get the point

 

[bleedinganus]

Masterofron" pid='91238' dateline='1590894076:

Assuming you use bitcoin to purchase illegal substances (steroids) you have nothing to worry about. Actually unless your buying something with bitcoin like a car for example, you have nothing to worry about. Nobody buys a car with bitcoin so that example is extreme, but I’m sure you get the point

How so? The IRS has stated that any transaction is subject to tax. If you get audited, what do you tell them? I sent bitcoin to a random address as a gift?

 

[terxeD]

Crypto transactions should be:

1. Open up a bank account and only use this bank for crypto, never use it for anything else, never make large transactions or deposit large amounts into this account. Everything below $1000. Everything is done with cash, never use checks to deposit.
2. Use a burner phone that can’t be linked to you for SMS.
3. Use an exchange or method of purchase that doesn’t show a crypto transaction, this means don’t use something like coinbase that will leave a record. If you can stomach the fees peer to peer is the best way to buy. All records for regulated exchanges are kept for 5 years.
4. Use unregulated wallets one time and then create a new one for every transaction.
5. If you can convert your btc to monero if your source accepts this payment.
6. Buy, stock up and then take a few years off to wipe your records clean. Don’t keep making purchases over and over. Stock up, get what you need and get out.

As for the IRS…we all cheat on our taxes, I do my best to get out of paying as much taxes as possible, tax is theft and it’s used to support the police and prison state so it’s immoral and dumb to pay tax.