quote:
I'm just trying to wrap my mind around how merchants would accept the currency for tax purporses. Wouldn't there have to be some type of exhcange rate before the government recognized it as a means of payment?

Don't quote me on any of this because I'm no tax expert. Maybe poodlebrain could better answer this.

But if I buy bitcoins and sit on them while they appreciate in value, then I have to pay capital gains taxes on them when I sell them. Of course, this would require honesty since "bitcoin" is just a protocol and can't send tax documents to the IRS.

And if a business accepts bitcoin with the BitPay model I described above, I imagine they would just pay taxes based on the USD value.

Now, the more interesting question, and probably what you are ultimately getting at is this:

If a company accepts straight up bitcoins and doesn't convert them to USD immediately, how do they account for that at tax time? If the bitcoin was worth $15 USD at the time of them receiving it, but it's worth $25 when they file their taxes, how does that work? I truly don't know.

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Posted by 13SaintTiger

Isle of Capri

Member since Sep 2011

18315 posts

Posted on 1/23/13 at 9:46 pm to WikiTiger

quote:
If a company accepts straight up bitcoins and doesn't convert them to USD immediately, how do they account for that at tax time? If the bitcoin was worth $15 USD at the time of them receiving it, but it's worth $25 when they file their taxes, how does that work? I truly don't know

Also what I wanted to know but I feel like the tax system would have to change in order to use bitcoins. Obviously by the time we use such a universal currency there would be other developments along the way to support such. (Not saying bitcoins end up being a universal currency or that we even develop a universal currency in my lifetime.)

quote:
I think what you will see with bitcoins is similar to what you see IRL with banking. People will end up trusting third parties with securing and backing up their bitcoin data

All that data floating around makes it a high potential to be hacked, don't you think? Instead of a bank robber robbing a bank, you have a Bitcoin robber. I just think it'll be that much easier for someone with the right credentials to hack the system, and correct me if I am wrong, this already happened right?

This post was edited on 1/23/13 at 9:48 pm

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Posted by gizmoflak

Member since May 2007

11675 posts

Posted on 1/23/13 at 10:00 pm to WikiTiger

How does one go about mining? Is it as simple as installing and running an application?

If I have a typical gaming PC build and I set it up to mine 24/7, what kind of B$ should I expect after a week or a month of dedicated mining?

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