Bitcoin : Tax Question
Okay, so I have to come clean on something, first. I bought my Bitcoin on Coinbase, and I’m ashamed to say I’ve left it there.
But I’m bought into the idea that everyone should control their own keys! You don’t have to sell me on it, I get it, and I’m with you!
My only hesitation is this… Let’s say hypothetically, the IRS (I’m a US citizen) wants to audit my Bitcoin transactions. How would they know that I’m not just moving stuff around so I can cash out without a trail back to my original purchase? In other words, they are looking for profit right? Doesn’t shifting my holdings to another address sort of obfuscate the fact that I am just holding the whole time?
Can somebody help me think through it? I want to avoid causing a “taxable event” under US law, but at the same time, reserve my option to maybe one day trade back a portion for fiat and clearly show (for tax purposes) my buy points and sell points.
Am I worried about nothing at all?
Bitcoin
Bitcoin is a distributed, worldwide, decentralized digital money. Bitcoins are issued and managed without any central authority.
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