IRS Reporting Issues

[sportslover323]

I am in no ways a tax accountant so just guessing here: I think you would have to declare 28k in gambling winnings and then the withdrawal of the BTC as capital gain as a separate event.

You transferred 28k of usd into bitcoin so that should count as a purchase of BTC at the price on that day for a total of 28k, then when you sell btc into cash then you count the price of the day you sold it and subtract to pay for the capital gain.

That certainly makes sense. I am going to meet with a CPA to discuss this. Not ideal to pay taxes on this type of money, but I'd rather pay the taxes than have someone coming for me later.

[TheMoneyShot]

That certainly makes sense. I am going to meet with a CPA to discuss this. Not ideal to pay taxes on this type of money, but I'd rather pay the taxes than have someone coming for me later.

Well technically it would be considered Gross Income.

You didn't trade BTC for investing purposely only.

I'm sure the IRS wouldn't mind that you're being honest about your "income gains."

[Bsims]

Here's my question regarding this stuff:

I bought into an online sportsbook for $2k via credit card. I turned that into 30k. I am now in the process of withdrawing the 30k using Bitcoin. Soon enough, I will have 30k worth of Bitcoin in Coinbase (let's assume the price is static) through 6 transactions (5k is the max withdrawal). 28k will have come from winnings and 2k from my initial deposit meaning at no point did I use my bank funds to purchase Bitcoin. How will this work when it comes to taxes? Is my basis price $0? Is all 30k technically a gain and therefore taxable?

At the end of the day, I want to do things fairly and the right way. I am just clueless as to what the right way is.

Using bitcoins to move money to and from sports books has been probably the most convenient method over the last several years. But now we can see an unintended consequence, taxes. Before bitcoin, your sports book transactions were pretty much invisible to the government. But acquiring and disposing of bitcoins through a U.S. exchange may change that and make sports book profits taxable..

[Bsims]

My angst about the IRS and Bitcoin continues. I think I understand what "should" be done. What I don't know is what I'm going to do. As I mentioned in post #40, I have about 3 alternatives. I've started on my taxes and will decide which approach seems reasonable to me.

Today I received an Email from Bitcoin.tax offering a webinar this Thursday about doing crypto taxes. I've signed up. I doubt that I'll learn anything that will make me happy, but what the heck. Here is the link:

https://zoom.us/webinar/register/291...Sx293ybxxeoL7g

I did listen to the Webinar and didn't learn anything significant. I thought it was worthwhile. It only took an hour and they have posted it on Facebook if you're interested.

https://www.facebook.com/visortaxes/videos/1655268497898920/

[Arky]

Interview with Andreas Antonopoulos on the tax laws. Almost 4 years old but still relevant:

https://www.youtube.com/watch?v=Uc5rar0GhIM

[chilidog]

Using bitcoins to move money to and from sports books has been probably the most convenient method over the last several years. But now we can see an unintended consequence, taxes. Before bitcoin, your sports book transactions were pretty much invisible to the government. But acquiring and disposing of bitcoins through a U.S. exchange may change that and make sports book profits taxable..

Or just use localbitcoins and keep it anonymous

[TheMoneyShot]

Or just use localbitcoins and keep it anonymous

How can you keep it 100% anonymous when that cash on the sell has to hit your bnk somehow?

I haven't tried localbitcoins yet.... looked it over a few times... want an easy sale... with no BS. Seems like there's BS everywhere... always someone trying to pull a fast one on you.

[chilidog]

How can you keep it 100% anonymous when that cash on the sell has to hit your bnk somehow?
I haven't tried localbitcoins yet.... looked it over a few times... want an easy sale... with no BS. Seems like there's BS everywhere... always someone trying to pull a fast one on you.

It doesn't have to hit your bank account. You meet up with a person, they give you cash, you send them bitcoins. Do it in a public place where you won't get robbed. Carry if you have a piece.

[TheMoneyShot]

It doesn't have to hit your bank account. You meet up with a person, they give you cash, you send them bitcoins. Do it in a public place where you won't get robbed. Carry if you have a piece.

I appreciate the input.

Rather not meet face to face with anyone. You don't know if there's another person watching you etc.

[chilidog]

I appreciate the input.
Rather not meet face to face with anyone. You don't know if there's another person watching you etc.

Yeah, then you're pretty much out of options at this point.

It's so archaic. The UK doesn't tax gambling winnings! I know the States will never change that, but sheesh. Nickle and diming us to death!

On the one hand, they tell us we can't bet on sports, yet on the other hand, they tell us that if we do, we gotta pay the man their cut.

[grs123]

dos anyone know if the only way to withdraw from a sportsbook is bitcoin and its over 50 000 that needs to be withdrawn do you have to pay taxes on the bitcoin? even if you have no intention to use bitcoin, do mining or profit from the actual bitcoin that is... and have to get it out because the bookie says thats the only way?????

[Bsims]

My angst about the IRS and Bitcoin continues. I think I understand what "should" be done. What I don't know is what I'm going to do. As I mentioned in post #40, I have about 3 alternatives. I've started on my taxes and will decide which approach seems reasonable to me.

It's a bit late, but I did report bitcoin profits to the IRS in 2017 as part of my normal filing (capital gains). Forgive me, but I'm an old man and don't remember how I did it. It was complicated and time consuming. With year end approaching I'll have to waste my time and figure it out again. On a positive note, should be capital losses in 2018.

[raiders72001]

It's a bit late, but I did report bitcoin profits to the IRS in 2017 as part of my normal filing (capital gains). Forgive me, but I'm an old man and don't remember how I did it. It was complicated and time consuming. With year end approaching I'll have to waste my time and figure it out again. On a positive note, should be capital losses in 2018.

This is a good article if you use Bitpay. https://blog.bitpay.com/tax-tools/