Hypothetically, if a person were to buy 1 ETH on coinbase (which reports all your info to the IRS of course) for let's say $2000, then send that 1 ETH to a metamask wallet (which does not have any connection to a person's real life identity) and then wait for that ETH to appreciate to $3000, then simply use the ETH as actual currency to buy $3000 worth of stuff directly, would that person have to pay capital gains tax at all? They made a capital gain of course but cryptocurrencies are currency, not stocks. Help me out here I'm kind of retarded
Hypothetically...
Jackson Flores
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Dominic Hill
When you send the ETH from Coinbase to that wallet you create the link to your identity
Julian Sanders
Ok but the question still stands, why can't I just use my "currency" for its actual use case of buying shit?
Jeremiah Edwards
The answer is obviously you can and the IRS is never going to know.
Nathaniel Garcia
And if i say that i got hacked and i own nothing ? No one can prove that it didn't happen
Carter Robinson
you could obfuscate that link using a tumbler, this is why you should use monero. so when you cash out, turn it into monero...
Nicholas Gomez
there aren't any laws written about that so you probably could get away with that excuse
Adam Morgan
what if it's your friends metamask wallet
Chase Green
"buying shit" counts as a taxable event in the US as well I think. basically any conversion. trading ETH for say BTC would also be a taxable event.
>And if i say that i got hacked and i own nothing ? No one can prove that it didn't happen
Depends how deep their investigation goes I guess? If you "buy shit" and that "shit" gets delivered to your address for example it becomes provable. question is, will they bother? there could also be other ways of them figuring out and i rly dont know how it works when you report it as stolen or when it actually gets stolen
Jose Allen
it can be anyones wallet
you can say you paid someone for a service
Jason Baker
idk how tumblers are treated in the US. in the UK they have a page but keep it secret, i dont think that bodes well for being connected to one xD
gov.uk
Andrew Turner
You can, but profits will be taxed.
The IRS doesnt have to prove shit, you have to provide evidence, if you fail to do so, they will estimate the gains and you dont want that to happen.
>The answer is obviously you can and the IRS is never going to know.
Until some autist yeets over your transactions and decides to make your life a little more complicated.
How do you cash out?
>it can be anyones wallet
>you can say you paid someone for a service
Can you prove it?
No?
You are fucked.
Tyler Wright
so then you would owe taxes for that service, otherwise it's considered illegal work, no?
also it's not a payment as such, coz it's crypto, and crypto mostly where there's no specific rules is treated like shares. so it's more like "i gave this women 3 apple shares for... a service"
Ethan Cruz
No, How would they pinpoint you to that tx.
Ethan Rodriguez
Ever heard of a "blockchain"?
haha
Christian Nguyen
yeah im thinking these guys dont know the basics
Maybe we do need that horrible bear market
Bentley Rogers
How are the "profits" taxed though? There's no "profit" if my neighbor says he'll sell me his boat for 5 ETH and it so happens that I bought 5 ETH three years ago and so I take him up on his offer.
Xavier White
Why is her neck so fat?
Nolan Gonzalez
>Can you prove it?
Burden of proof is on them, retard. Believe it or not, I am innocent until proven guilty, not the other way around. If you aren't a shill, you are a genuine retard.
Isaiah Foster
It's not a murder case where the standard is beyond reasonable doubt. Crypto cases will be more like drug charges where the stand'of proof is ehh i guess that seems kinda possible. Any judge will understand the point when the irs asks him to judge fairly according to the ehh seems kinda possible. You sent eth to an address. That's proof enough that you made capital gains. Even if you didn't this is how it goes down all the time with drugs and other loosely written laws.
Owen Fisher
Can you cite some precedent for this for crypto specifically?
Evan Gray
>You sent eth to an address. That's proof enough that you made capital gains.
No it isn't. They can only prove you sent eth to a wallet. If you sent it immediately after buying it - thus disposing of it for the same price you acquired it - and you claim the wallet you sent it to is not yours, there is no way they can prove you owe anything.