How Crypto Taxes Work – Miyagi Mornings Episode-102
If for any reason the above Odysee Video doesn’t play smoothly for you, the back up YouTube version is here.
This is another question from the MeWe thread stacked to the top of my MeWe Profile here ( ) if you want to ask a question for Miyagi Mornings that is the best place to do so. Here is today’s question…
If my business accepts $100 worth of BTC for a good, would I then owe x% * $100 value at time of purchase, or would I owe x% * $ value of btc at the time of paying taxes.
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Since my business is new, I can only claim as much expenses as my business brings in, and idk if that is in terms of the dollar value at the time of transaction or the value of those coins on Dec 31.
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I.e if bitcoin doubled by the end of the year and I never sold the coins that customer sent, did my revenue also double?
That may be a bit of a jumble but I think it is due to over thinking. Compliance with crypto taxes is actually easy to understand, it becomes complicated to do only when trading/selling or converting them. Even then it is not complicated to understand only logistically complex to do the accounting for.
Good rant and even better information. Good job all around.
The tax rules sort of follow basic accounting or is it cot accounting 101. The cost of the traded item is bench marked at trade and conversion to capital gains / loss at time of conversion. So bit coin is sort of a currency and barter all rolled up together.
Good point that if you can trace your specific transaction to a specific bit coin transaction you can sell the specific coin that would meet long term / short term capital gain, and at a loss or grain. Pretty much what you can do with stock purchases.
So if each day I create a wallet with that day’s net transactions for the day, I can flag the specific cost of said coin, and work from there. I can then select which wallet that I buy /sell / trade from so I can follow the the rules. I had done this sort of thing when I had some stock trades. I would trade some that were under water with stuff that I made a profit on to offset capital gains / losses.
Boy is there a lot of data that needs to be tract if you decide to track all the info you need to make sure what is traded / converted has been flagged to your best benefit.
Now just wait for an audit and have them demand all that unique data that turns all bit coin style transactions tagged to your wallet. It sort of makes you go ARRR(G).
For a fun movie – see the 1959 flick that covers some of these “barter” issues…the movie title was “The mating Game”. Tony Randal & Debbie Reynolds