SoylentNews is people
SoylentNews
Submitted via IRC for TheMightyBuzzard
The 10,000 bitcoins that seven years ago famously paid for the delivery of two Papa John's pizzas would be worth more than $74 million today.
The exploding value of the cryptocurrency since its first real-world transaction in 2010 is one reason the U.S. Internal Revenue Service is pushing to see records on thousands of users of Coinbase Inc., one of the biggest U.S. online exchanges. The company's digital currency platform allows gains to be converted into old-fashioned dollars in transactions that the IRS alleges are going unreported.
Coinbase and industry trade groups are fighting back in court, claiming the government's concerns about tax fraud are unfounded and that its sweeping demand for information is a threat to privacy.
(Score: 5, Insightful) by bradley13 on Sunday November 12 2017, @04:00PM (14 children)
I have always wondered why the tax authorities have the right to your private financial information, in the absence of any suspicion of wrong-doing. Really, they should need a warrant to access your bank data, your salary, etc..
Sure, some people would cheat on their taxes. Tough. No one ever said law enforcement was an easy job.
Everyone is somebody else's weirdo.
(Score: 4, Interesting) by Anonymous Coward on Sunday November 12 2017, @04:22PM (13 children)
If a warrant were required, we'd need to change the constitution or, worse, hand out warrants in bulk to cover all people.
People simply would not pay taxes. It starts with a modest portion of the population, suppose 10% for example. Others see how that is working out, hate the unfairness, and decide to take the opportunity as well. It's like how many people will loot only if they see others doing it. Before long, it's more like 90% cheating on taxes.
Greece had something like this going. Cheating on taxes became a national pastime, contributing to severe problems for the country.
(Score: 3, Informative) by BK on Sunday November 12 2017, @05:11PM
Warrants in bulk are already unconstitutional. It's called a general writ and it's explicitly forbidden by the USA constitution.
This is actually a great argument for property taxes. Of course then, you can only tax the property can see. But I'm OK with that.
...but you HAVE heard of me.
(Score: 5, Interesting) by crafoo on Sunday November 12 2017, @05:24PM (4 children)
Maybe universal income tax should go away then. We can eliminate most of the IRS, tax services, and other undocumented drags on the economy.
If something is too difficult to be done, that doesn't mean we should toss out inalienable rights to get it done. We must look hard at what we are doing, why, and at what cost to our civilization.
(Score: 3, Interesting) by sjames on Sunday November 12 2017, @06:45PM
It is notable that when the income tax started, the vast majority of people weren't required to file. Unfortunately, the brackets weren't indexed to inflation, so over time later legislatures were able to tax increasing proportions of the population through simple inaction.
(Score: 3, Informative) by Anonymous Coward on Sunday November 12 2017, @07:26PM (2 children)
Progressive taxes is how you institute any basic notion of fairness into the financial system. Without such a system, the wealthy simply get more wealthy a lot quicker, and the poors starve instead. Then you have a revolution or Zimbabwe scenario and things start again. Personally, I would rather have the wealthy pay taxes so government can pay the poors to provide services to the wealthy without causing inflation to strip away meagre savings of the poors.
You see, you really want strong progressive tax system in place. The alternative is you fuck the country and screw the future so some can take faster. And if those rich want to maintain their riches, then they really want to have strong progressive tax system too, since when the poors revolt, they lose their shit too.
Exactly. Otherwise you may start to equate money with things like social order, and not having Syria type civil wars. If you want stability in your nation, you want to reduce income inequality and at least have a perception that the rich are paying more taxes even when their increased share is insignificant when comparing disposable incomes.
(Score: 2) by crafoo on Monday November 13 2017, @12:59AM (1 child)
Are you making an argument for or against income tax? I can't really tell. I assume you know the wealthy aren't really affected by income tax. Capital gains tax is maybe what you mean?
Income inequality is fine and expected. The is a pretty big variation in people's capabilities, motivation, and industriousness. What we want to allow for is very easy mobility. Remove barriers for success. Open as many avenues for success to as many people as possible. Progressively apply larger tax pressures and "enforced responsibilities" as a corporation grows. No free rides though. People have to choose to put in the effort and take the risks.
(Score: 0) by Anonymous Coward on Monday November 13 2017, @04:05AM
You're right. Sociopaths are superior beings and clearly deserve the lion's share of our economic output.
(Score: 0) by Anonymous Coward on Sunday November 12 2017, @05:38PM
paying the scum at the irs is sedition.
(Score: 0) by Anonymous Coward on Sunday November 12 2017, @06:19PM (5 children)
If you must have an army of inspectors looking into the minute financial details of a large swath of the population, then maybe you've designed a bad system.
It sounds like your system of taxation is not anti-fragile.
I mean, don't you want the funding of essential services to be a matter of voluntary exchange, in that everyone involved thinks it is perfectly natural to pay his "fair share"? That way, you don't have to enforce it; it's just natural. Well, your system fails miserably at that. Maybe you should re-think it.
(Score: 3, Insightful) by mhajicek on Sunday November 12 2017, @07:12PM (4 children)
No, those in power do not want your subservience to be voluntary.
The spacelike surfaces of time foliations can have a cusp at the surface of discontinuity. - P. Hajicek
(Score: 1, Informative) by Anonymous Coward on Sunday November 12 2017, @07:30PM (3 children)
While there is some truth to what you say the problem is that too many people would opt not to pay. The average human is short sighted and would not care to fund police, fire, or medical services let alone parks and rec and other such minor programs.
The problem is that these services do help society a lot, but people on their own would not fund them sufficiently. If you make everything optional you end up with a worse system than we have now with capitalist corporations doing everything they can to avoid taxation.
While I like the concept of pure freedom the reality is that human society, no the human animal itself, is not capable of successfully sustaining it. We need direction, at least until every human born is capable of being reliably saint-like.
(Score: 3, Informative) by jmorris on Monday November 13 2017, @12:25AM (2 children)
I dunno, most people seem to like the idea of medical insurance, it being utterly unaffordable because of government meddling is the problem. Give people an option to pay a reasonable amount for decent coverage and it sells. Tell people there is reasonable private options and we aren't going to give out freebies anymore to deadbeats unless they are REALLY hard luck cases and most will get the hint that if they have a choice between the medical insurance and cable, pay the insurance. Problem is it is currently often a choice between medical insurance and a mortgage + utilities.
The first fire departments were created by the insurance industry to save money, why couldn't that model still work? Parks aren't super expensive, lots of people would love to pay for them, might put their name on them but we put SOMEBODY's name on em anyway. The problem was socialism came along and the serpent tongues convinced people the government had to do everything that didn't involve direct cash for goods or service and then government should do (or just regulate into a crippling stupor) most of that as well.
Government does nothing well. Nothing. There are a few vital functions we lack the social tech to accomplish any other way so we need a government, but it should be as severely limited as possible to minimize the inefficiency, stupidity and evil it always generates.
That has to be one of the more evil things written. From that mindset comes every foul totalitarian hellhole that ever existed. No, the correct solution is to build a system for fallen humans since that is all that is available anyway. Where do you think you are going to find these saint-like rulers to "direct" us? You have to assume they, being human, are also fallen. Stop believing you can Immanentize the Eschaton and build a system that can survive being implemented and operated by humans. You do that with severely limited powers, transparency, divided power and rotating people out of government service to force them to live under the laws they make.
(Score: 0) by Anonymous Coward on Monday November 13 2017, @01:33AM
"That has to be one of the more evil things written"
But its true. People ( as a whole, not the individual ) need to be lead. They can not function without one.
(Score: 1, Insightful) by Anonymous Coward on Monday November 13 2017, @03:05AM
You're a moron on pretty much everything other than technical discussions. There is a middle ground between totalitarian regimes and anarchy, but apparently you're a windbag that can't figure it out. We don't have saintlike leaders but we do have a system in place (democracy lite) that keeps a constant turnover to make sure we don't end up with a dirtbag forever.
We are all now in danger from nutters like you who vote for liars and encourage ignorant destruction of government. Stupid schemes to reinvent the entire concept of government that would either throw us into a Mad Max future or take us right back to evil "government". You got so triggered by my pointing out simple reality, you should think about that.
(Score: 0) by Anonymous Coward on Sunday November 12 2017, @04:16PM (20 children)
Last summer, my son did work for my brother, and got "paid" with about $2000 worth of Bitcoin. I guess it's $3000 now.
We still haven't transferred it. How in Hell are we supposed to safely and reliably deal with this complicated mess?
Computers fail, get hacked into, and get stolen. Whole houses burn down. Passwords get forgotten. Special "hardware" holders for passwords and Bitcoin cost money, plus they are really just computers (fail/hacked/stolen) running software anyway. Online accounts for Bitcoin are "in the cloud", meaning on somebody else's computer, and the often-shady owners are prone to being hit by hacks and government action.
Now I hear there are even transaction fees. You move your Bitcoin, and some ass gets to swipe a chunk of it???
This mess sucks. I don't want the hassle. I don't want to worry about all these things.
(Score: 4, Informative) by Kilo110 on Sunday November 12 2017, @04:23PM
you could make a "paper wallet" (the secret key as a QR code printed on paper) and save it in a bank deposit box.
(Score: 1) by khallow on Sunday November 12 2017, @04:51PM
Yes. It's built into the model and you'll probably pay fees to have it converted to dollars as well. Even if it were some huge fraction of the bitcoin value, you'll probably be better off than holding on to it (even before the observation that we're in a bubble market).
(Score: 3, Informative) by DaTrueDave on Sunday November 12 2017, @05:19PM (2 children)
No, it's worth about $20,000 now, if not more. 1 BTC was worth about $600 last September, but is worth over $6000 now.
That's probably worth an hour or so to open up a bank account for your son, create an account at Coinbase, and cash out some portion of it, if that's what you want. Personally, I don't think it's done increasing in value.
(Score: 4, Insightful) by khallow on Sunday November 12 2017, @05:39PM (1 child)
(Score: 1) by khallow on Sunday November 12 2017, @06:29PM
I think that is more accurate than what I wrote before.
(Score: 0) by Anonymous Coward on Sunday November 12 2017, @05:31PM (1 child)
You pay transaction fees on virtually any method of transferring money. Credit cards, paypal, wires. The main ones that you can use if you don't want the fees are cash and checks.
People seem to be awfully unaware of how the infrastructure to make payments is paid for. They typically get a certain percentage of the money or possibly a fixed cut in order to handle the back office stuff involved with actually transferring the money. They often times also collect money from interest and fees, but the processing fee is always there, it's just usually hidden from the buyer.
(Score: 2) by Runaway1956 on Sunday November 12 2017, @06:45PM
Checks? Of course there is a fee involved in checks. The bank may "give" you a book of 20 checks when you open the account, but then you have to pay for replacements. Aside from that, checks are mostly free of fees. Cancel one, bounce one, or require some kind of special handling of the check, and there will be a fee involved.
(Score: 0, Funny) by Anonymous Coward on Sunday November 12 2017, @05:43PM (1 child)
because you're ignorant and lazy it's someone else's fault? and your best course of action is whining to the world about it? pitiful slave. getting btc is the easiest part. storing it or getting rid of it is easy. wtf is your problem?
(Score: 5, Insightful) by Runaway1956 on Sunday November 12 2017, @06:51PM
Devil's advocate here. Ignorance is a valid reason to avoid a form of currency that is not in wide use. Countless people have been taken by currency exchanges, around the world, when traveling. There is always someone ready to take advantage of ignorance. Learning can be costly. Regarding digital currency - how many stories have there been now, in which a bunch of people thought they had some appreciable wealth, only to find it evaporated into the thin air from which it came? Someone "hacked" the system, and stole millions, billions, or whatever. Or, the system just failed. Or, the founder/administrator took the proceeds and vanished.
There is an appreciable amount of knowledge to ingest regarding cryptocurrency. A person who knows he is ignorant, and avoids that cryptocurrency, is a fairly wise person.
(Score: 2) by bradley13 on Sunday November 12 2017, @06:17PM
As others have said: (a) it's worth a lot more than $2k now, and (b) if you don't like or understand Bitcoin, you really ought to sell it.
Dunno why you're upset about fees. Tell me what kind of financial transaction isn't subject to fees of one kind or another. In the case of Bitcoin, the fees are higher than they ought to be, but given the massive profit your son has made from last year to this, who cares.
Help him sell it, have a nice dinner to celebrate, get on with life.
Everyone is somebody else's weirdo.
(Score: 2) by maxwell demon on Sunday November 12 2017, @06:19PM (2 children)
Your credit card also has transaction fees. Your bank account might have them, too.
The Tao of math: The numbers you can count are not the real numbers.
(Score: 2) by crafoo on Monday November 13 2017, @01:05AM (1 child)
Exactly. Every bank account has them. Some, it's outright fees per transaction. Others require a minimum balance, which is essentially the same thing. They give you 0% (or maybe 0.1%) interest on your balance. Usually though it's 0% in checking. They make money off of your money. You do not. You could be making > 5% with little risk. That's the hidden fee.
(Score: 0) by Anonymous Coward on Monday November 13 2017, @05:24PM
No, the minimum-balance/no-interest thing is a holding fee. That is, you are paying even if you do nothing at all with your money. With bitcoin, as long as you don't move it, you don't pay.
(Score: 2) by Runaway1956 on Sunday November 12 2017, @06:41PM
While others are directly addressing the bicoin issue - I'll mention that offsite backups are essential sometimes. For most purposes, Google's Gdrive is an adequate backup for keys and stuff. I say "most purposes", but it most definitely is NOT good for anything that law enforcement might take an interest in. In your case, backing up your bitcoin data to a couple of USB drives, and secreting them somewhere may be a better solution. Or, if you trust "the cloud", but not Google, then buy some cloud space. The already mentioned idea of a safe deposit box is a good one for essential data, whether that data be in digital form, or on paper.
Data that is backed up in multiple locations is probably safe from destruction, or from being forgotten. But, the more locations you back it up to, the more exploits it may be subject to.
No matter how you look at it, you have to balance the risks.
If we were professional criminals (by "professional" I mean "successful") we would probably have some highly protected location, with several professional killers guarding our data. Unsuccessful criminals save their shit to Facefook, or their own smartphones.
(Score: 1, Informative) by Anonymous Coward on Sunday November 12 2017, @07:31PM (1 child)
It's pretty easy from tax standpoint. Bitcoin is an asset. When you dispose of it, you calculate amount of gains/loses you sustained, and that is what you report for taxes. It's no different paying in bitcoin than paying in shares of Microsoft, or Facebook or paying with gold. All are assets. All are under capital asset rules.
As to transferring it, well, that's your problem. Just like it's your problem if you want to transfer gold, or coal, or manure to someone else ;)
(Score: 0) by Anonymous Coward on Monday November 13 2017, @01:54AM
Except the US government does not like their livestock trading gold, and they tax it at higher "collectible" rates.
(Score: 2) by MichaelDavidCrawford on Sunday November 12 2017, @11:01PM
Register at an exchange. Request a bitcoin address. Give all his coin to that address. Sell it from dollars with the proceeds sent to his bank by electronic funds transfer
That will take you ten more minutes
Coinbase's fee is just $2.99. It has a really good UI
Yes I Have No Bananas. [gofundme.com]
(Score: 1, Informative) by Anonymous Coward on Monday November 13 2017, @01:44AM (2 children)
Late to this thread, but no one has mentioned that if your son earned more than $600 (in the USA), a 1099-MISC income tax reporting form should be filed with the IRS by the payer (your brother). Then, the payee (your son) needs to file a tax return (probably there will be no taxes due, if that was his only income).
If the income (above $600) was not reported, both sides of the transaction are potentially in trouble...
(Score: 0) by Anonymous Coward on Monday November 13 2017, @09:06AM (1 child)
Unless this was work for hire (a contract job). Then the receiving party needs to report this income and pay (if applicable) any VAT for the services rendered.
Just like with any contractor you hire, you do not need to report anything to anyone even if you pay them $100k to build a house for you. It's the contractor's duty to file and remit all necessary taxes. The problem is payments in Bitcoins are MUCH more complicated from taxation standpoint because of capital gains issue. This is especially a problem if you do it not in the same year as incurring the expenses. But that's a problem where you dig your own holes for yourself.
(Score: 2, Interesting) by j-beda on Monday November 13 2017, @02:43PM
That's how it SHOULD work, but that isn't how it DOES work in the USA. At least not always.
If you hire a nanny, you need to treat them as an employee and file all sorts of paperwork - even if they want to treat the whole thing as a contracting situation. Unless they work for a corporation in which case you contract with the corporation and they deal with all the paperwork.
If you run a business of almost any type, includige self-employment, and contract to an non-corporate entity to do business related work over $600 (including mowing the lawn), then you need to file 1099 stuff. If you are not a business but contract someone to do the same lawn care, you PROBABLY don't have to file a 1099, but doing so might be a good idea.
"Small landlords" often do not need to file 1099s for people they hire, but "large" ones do. Clarity is hard to come by on these things. From the kid's point of view, it doesn't matter if a 1099 was issued or not, they need to report the income, and the result is the same if they got a 1099 or if they did not get one. From the payer's point of view, unless they are claiming the expense as some sort of deduction from income it probably doesn't matter one bit, since the IRS is never going to find out about it and the resulting tax liability does not change either way.
If you are on the other end, and perform work for someone, whether or not you get issued a 1099, you should certainly report the income (self-employed income, subject to extra self-employed taxes similar to the employer taxes that get paid for "regular" employment income).
In this case, if the kid was payed $2000 US dollar value (in whatever form, bitcoin, gold, euros, etc.), the kid should report that as self-employed income, deducting whatever legitimate expenses he might have incurred (advertising, bus fare to get to the job, equipment maintenance, whatever), and then paying the outstanding value.
Then, whenever he transfers the bitcoins into US dollars, he should report the difference between the sale price and the $2000 initial value as cap. gains, and pay the appropriate cap. gains tax which is significantly lower than the tax rate that working people pay on their income. Becasue we need to encourage the wealthy to remain wealthy I suppose, and if we taxed investment income the same as regular income nobody would ever invest their money, instead they would just put it into a silo like Scrooge McDuck and swim in it I guess. But I digress.
Of course, I'm not an accountant or tax lawyer or anyone "qualified" to speak on these issues, so this is not tax, business, or legal advice.