(US Taxes) Cryptocurrency Mining requires Taxes

[lieder1987]

Just an FYI. I found this today when I was doing some research to change my country on coinbase (what a pain that is).

 

You are required to pay taxes against "currency" that is mined. See question 8 of the link bellow.

 

https://www.irs.gov/pub/irs-drop/n-14-21.pdf

[Pachuca]

2 hours ago, lieder1987 said:

Just an FYI. I found this today when I was doing some research to change my country on coinbase (what a pain that is).

 

You are required to pay taxes against "currency" that is mined. See question 8 of the link bellow.

 

https://www.irs.gov/pub/irs-drop/n-14-21.pdf

that sucks. So anything I mine even if I don't use it I still have to pay tax on it?

[Loot]

how are you going to pay taxes on something thats 5$ one day and 1000$ the next ?

[lieder1987]

2 hours ago, Pachuca said:

that sucks. So anything I mine even if I don't use it I still have to pay tax on it?

Yes exactly.

 

2 hours ago, Loot said:

how are you going to pay taxes on something thats 5$ one day and 1000$ the next ?

I am no tax expert, but the way I read it was whatever you have not withdrawn into US before you file taxes you take what they are worth at that time. So if you pull $600USD out and have the equivalent of $3600 in there based on the day's exchange rate you have to claim 4200 in taxes.

[Pachuca]

10 minutes ago, lieder1987 said:

Yes exactly.

 

I am no tax expert, but the way I read it was whatever you have not withdrawn into US before you file taxes you take what they are worth at that time. So if you pull $600USD out and have the equivalent of $3600 in there based on the day's exchange rate you have to claim 4200 in taxes.

Do you know how much tax would need to be paid for this?

[lieder1987]

33 minutes ago, Pachuca said:

Do you know how much tax would need to be paid for this?

I am not a tax person. I wouldnt have any ideas. I am solely passing on the information that I found.

[Pachuca]

4 hours ago, lieder1987 said:

I am not a tax person. I wouldnt have any ideas. I am solely passing on the information that I found.

Found my answer: 

 

https://turbotax.intuit.com/tax-tools/tax-tips/Taxes-101/Tax-Tips-for-Bitcoin-and-Virtual-Currency/INF29402.html

 

 

"Bitcoin miners must report receipt of the virtual currency as income

Some people "mine" Bitcoins by using computer resources to validate Bitcoin transactions and maintain the public Bitcoin transaction ledger.

According to the IRS, when a taxpayer successfully “mines” Bitcoins and has earnings from that activity whether in the form of Bitcoins or any other form, he or she must include it in his gross income after determining the fair market dollar value of the virtual currency as of the day he received it. If a bitcoin miner is self-employed, his or her gross earnings minus allowable tax deductions are also subject to the self-employment tax."