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Self-employment taxes aren't for all types of income earned outside of an employer. They're for all types of income earned while self-employed. For instance, if you sell a car that's a form of immediate gross income but that does not mean that you are a self-employed car dealer. As a person using the GPU in your desktop to mine cryptocurrencies, you are generating immediate income in the form of a capital asset. But this isn't self-employment; you report the income but you don't pay self-employment taxes e: Obviously that may change if you're an idiot installing racks of GPUs in your garage QuarkJets fucked around with this message at 21:16 on Jul 21, 2017 |
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Jul 21, 2017 21:12
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Twerk from Home posted:You're right that coin trading gains or losses are capital gains. However, coin mining is ordinary income. If you build a car and then sell it, that's income that you would owe self-employment tax on, not capital gains. If you sell a car that you previously bought for a profit, that's capital gains. The IRS is being very explicit that mining counts as income and you owe self-employment tax. If you regularly produce and sell paintings for a living then yes, that is a business. But if you paint in your free time and happen to sell 1 painting for $500, are you self-employed then? I don't think so, the IRS doesn't seem to say that you are, and that's more akin to what we're talking about now than a professional painter. Back to the IRS notice, I'm quoting this section: quote:If a taxpayer’s “mining” of virtual currency constitutes a trade or business, and the The notice is explicitly differentiating between personal income and income earned as part of a business. And the IRS defines self-employment in the following way: https://www.irs.gov/individuals/self-employed quote:Who is Self-Employed? I don't think that mining cryptocurrency on your PC's single GPU constitutes running a business any more than selling a single painting would constitute running a business. Heading to a casino and suddenly winning a bunch of money on the slots would not constitute being self-employed; making a living as a professional poker player constitutes being self-employed. QuarkJets fucked around with this message at 21:39 on Jul 21, 2017 |
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Jul 21, 2017 21:37
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Twerk from Home posted:If you sell a single painting that you made for $500, you sure as hell owe self-employment tax. The cutoff is $400 for reporting income like that, and if you made the painting, then that's earned income, which is subject to the self employment tax. You can owe self employment tax on hobby income. I'm not convinced, since the IRS website doesn't seem to agree with what you're saying. Even the link that you provided differentiates between a dealer (say someone who sells paintings regularly) and a non-dealer (someone selling their first and probably only painting). All of the links provided so far seem to say that self-employment requires some professional capacity and doesn't include happenstance things like finding $20 on the street or getting paid $50 by a friend for helping them move but I don't really care since I have no skin in this game either way 
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Jul 21, 2017 21:54
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Yeah discussions about profitability in the mining thread are irrelevant anyway
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Jul 22, 2017 05:16
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1gnoirents posted:I can genuinely say this is a hobby, most of us here could I imagine. Im morr invested than many here in that I built a computer for it, but I built a computer for $86 to see if I could. If I was taking this serious, like taxable income serious, Id have bought real equipment and a bunch of gpus the first moment I could because there would have been a very real chance of turning actual income levels of profit. Id worry about taxes then. FYI all income is taxable income, including hobby income. Hope you're keeping records!
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Jul 23, 2017 02:05
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eames posted:is that your posting on reddit? I don't understand the scam in that post; the seller gets his card back and the buyer gets his money back, who's getting scammed here exactly? Is he implying that the buyer is a mole planted by FedEx to get people to ship video cards back and forth?
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Jul 26, 2017 09:13
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Rabid Snake posted:He has to pay for return shipping which isn't cheap so it's still a net loss But the buyer had to pay for shipping in the first place, so they both lose an equal amount to each other. eames posted:The idea is that some people bought these cards while mining was profitable, used them to mine and now return them with a fake reason because it becomes unprofitable (and card prices are going down, so the seller loses the price difference). Ebay's buyer protection allows these refunds for 180 days. The reddit thread claims that some buyers send back older cards with different serial numbers and keep the newer ones. lol that's awesome all hail cryptocurrency
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Jul 26, 2017 12:34
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1gnoirents posted:Even at its worst so far that comes out to like 6 days a month to make up for power If you're mining bitcoin, specifically, then yes there is no way that you are paying off your own power bills. Altcoins will vary by your hardware, how much you pay for electricity, and whether you need to also pay for cooling. Plus don't forget transaction fees There's no scam here it's simply math and accounting, things that most people are bad at and that cryptocurrency early adopters seem to be very bad at (referring to the timeframe where asic mining at home was somewhat popular but hilariously unprofitable). If the math adds up for your altcoin of choice then go right ahead
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Jul 26, 2017 23:26
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Spatial posted:Well, there is the moral cost that you're being paid to verify the transactions of extortionists, con artists and drug dealers And depending on where you live, the marginal health and environmental costs of exchanging electricity for virtual currency Surprise Giraffe posted:You can achieve something similar through the use of various major banks Not really though, money laundering isn't as simple as going to a bank and saying "yes hello I would like to exchange this $10M for a fresh set of bills please". The ease of using bitcoin for illicit purchases and money laundering vs using various major banks for the same purpose is why Bitfinex can no longer allow withdrawals anywhere outside of their home country QuarkJets fucked around with this message at 02:31 on Jul 27, 2017 |
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Jul 27, 2017 02:29
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Hey very relevant to the illicit activities discussion, one of the central figures running BTC-e was arrested and BTC-e itself is being fined $110M over a litany of charges, including money laundering.
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Jul 27, 2017 11:04
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or just go to a casino or something, it's all the same
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Aug 5, 2017 09:47
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NVidia: the new Butterfly Labs
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Aug 9, 2017 01:59
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it was referring to the post above mine where apparently the Vegas have worse performance than promised and are being delivered way late
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Aug 9, 2017 02:11
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Fauxtool posted:were you aware that vega is an AMD product not Nvidia? trap sprung
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Aug 9, 2017 04:24
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MaxxBot posted:Jesus over 4k and climbing, makes me wish I didn't cash most of mine out. That's just gambler thinking; you can't actually time a peak. Be thankful that you cashed out for profit and didn't hold on until the next big crash
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Aug 13, 2017 03:04
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MaxxBot posted:Huh? I think he's referring to the cycle that gets created when a major exchange (like Bitfinex or MtGox before it) stops USD withdrawals but permits bitcoin withdrawals; this drives demand for bitcoin at that exchange (because people want to get their money out), driving the price of bitcoin up everywhere thanks to arbitrage. People see the new price increasing and go to one of the major bitcoin exchanges, such as Bitfinex, to buy some bitcoins, but then when they want to cash out they see that they can't, so the feedback loop continues. As you might expect, the opposite thing happened when two big Chinese exchanges stopped Bitcoin withdrawals but permitted withdrawal of actual money. You might ask: when does such a feedback loop end? That's near-impossible to predict, like any bubble. Anyone buying in right now, or holding right now, is making a huge gamble that they'll be able to predict the peak before the crash.
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Aug 13, 2017 04:31
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God speed, hope you can time the peak
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Aug 15, 2017 06:23
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wolrah posted:Though why you'd have long-term Bitcoin not in a private wallet I don't understand. It's so easy and then you don't have to worry about a high profile target exchange being hacked or shutting down or stealing everything. using private wallets just shifts the responsibility of security onto the user's shoulders though, and the average bitcoin user is woefully ill-prepared for that responsibility if /r/bitcoin is any indicator; for those individuals an exchange is far more secure for instance several popular brain wallets initialized to the same random seed every time that a new wallet was created, so all of the people using those wallets lost everything. And other wallets turned out to be waiting for a large enough whale to use them before sending everything to the developer's address
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Aug 16, 2017 22:45
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Computer Serf posted:what's with this selling hash rate stuff? if you're talking about nicehash, you run a program that mines various low-difficulty altcoins that other people want to buy; the program pays you in bitcoins for doing this yes there are people willing to buy mining time for miscellaneous altcoins, for speculation, and the person running this thing skims some percentage off the top because for your group to be effective at mining you need more mining power than what goons alone could provide
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Aug 17, 2017 00:50
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Dr. Fishopolis posted:Not in any reasonable quantity. I'm sure someone's making money or else it would have collapsed by now, but hell if I can figure out a path to profit, especially compared to just buying the coins in the first place. Rich Chinese businessmen have been using cryptocurrency and Western gullibility to convert Yuan to USD and other hard currencies (via bitcoin) for years. Bitcoins are primarily mined in China these days, but selling bitcoin suppresses the price so now more liquid altcoins are traded and sold instead. Money laundering probably still has a big impact as well, despite btc-e closing. Dirty money buys bitcoins, bitcoins buy altcoin mining power so as to not suppress the price of bitcoin, altcoins are sold for clean money.
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Aug 21, 2017 22:04
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Craptacular! posted:Keep in mind Beijing has been putting hard limits on how much money rich people on the mainland can leave with, and the limits are often set lower than they want. This crimps their ability to gamble millions of dollars as whales in Macau. The Chinese government already put a big crackdown on "junket operators" who were essentially behaving as middlemen, allowing Chinese millionaires/billionaires to go to Macau and Vegas (where this was a big deal in the local papers a couple years ago.) Mining is mostly done in China and can be thought of as "purchasing" bitcoins. From there you sell them on an exchange or use them to buy altcoins (such as via nicehash, which since you are buying mining time helps to further obfuscate the money trail).
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Aug 22, 2017 00:49
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Craptacular! posted:I'd just assume you buy Virtual Bullshit Dollars with Chinese money while you're in China, go to Macau/Vegas/Singapore/whatever, and once there you sell your Virtual Bullshit Dollars for the local currency. Boom, you just moved a million dollars out of China and into the US without PRC authorities being able to trace it. First you'd need to find someone who wants to sell you Virtual Bullshit Dollars for Yuan. Therein lies the problem. Mining bitcoins gets around that problem by turning Yuan into electricity and hardware, which then produce bitcoins that you can sell outside of the country
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Aug 22, 2017 05:03
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It's almost as though their target market is composed of a bunch of rubes who made up the term "honest ponzi"
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Aug 25, 2017 21:01
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Comfy Fleece Sweater posted:I was in a Ethereum group Redundant
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Aug 26, 2017 09:36
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Junior Jr. posted:But I thought you said Monero was an interesting altcoin because it's untraceable so banks and hackers (possibly) can't try to find your wallet address and coins. That's the one advantage it's got that bitcoin doesn't have. I do get that it's dangerous because ransomware hackers and creepy dark web guys are all over that. A person getting their wallet keys spearfished by a hacker is probably the least likely way to lose bitcoins. Anonymity is super useful if you are selling drugs or laundering money though
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Aug 27, 2017 00:24
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^^^ And also eastern europe; it turned out that BTC-e was basically a front for the Russian mob to launder money
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Aug 28, 2017 00:27
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Junior Jr. posted:Yeah I thought the same too. I googled services and retailers who accepted Bitcoin, I was surprised Expedia, Newegg, even Microsoft all took Bitcoin now. That's because none of those businesses actually take bitcoin; they take Bitpay or Coinbase. It's kind of like saying "the sandwich shop on the corner accepts russian rubles" because they have a Visa logo on their cash register.
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Aug 30, 2017 07:27
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1gnoirents posted:Can we stick to a standardized burrito based measuring system in case the Fed's are watching The feds don't give a poo poo what measurements you use so long as you report your gains in USD and are paying your self-employment taxes ... You did remember to start paying self-employment taxes when you started up nicehash, right?
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Aug 31, 2017 00:20
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hobbesmaster posted:Are you going to make more than $400 off your video card mining? Anyone claiming at least $2/day in mining income after electricity (many of the posters in this thread) would likely be over that threshold. But that's assuming they're accurately tracking electricity costs and the spot price of bitcoins
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Aug 31, 2017 05:18
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"Pro" miners
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Aug 31, 2017 23:33
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MaxxBot posted:What now Yellen? Your archaic fiat currency is worthless here that oughta show em
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Sep 1, 2017 23:19
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Welp 20M Tether just appeared out of nowhere so I guess Bitcoin is going to hit a new height soon
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Sep 2, 2017 23:06
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Comfy Fleece Sweater posted:I figured, but what's the gimmick ? The people who run/operate Tether claim that each Tether is backed by $1 USD, so you can hypothetically redeem tether for cash at any time. Some exchanges quote the price of Bitcoin in Tethers (USDT) instead of US Dollars (USD) because they're supposed to be equivalent. In practice there's no proof that the backing exists at all. When people question the existence of these audits or ask what group even conducts the audits, the response is always "we would never dodge our auditing responsibilities! We could never stay in business if we maintained a fractional reserve!" without actually answering the questions. USDT just seem to show up out of nowhere and no auditing actually occurs. Further, the Tether legal page makes it very clear that the corporation "backing" USDT with real dollars is under no obligation to honor that backing. So Tether is essentially a way to buy bitcoins with counterfeit money. Bitcoiners naively assume that the USDT they're receiving is the same as USD. This pumps the Bitcoin price. Such a scheme is unsustainable because those additional dollars only exist on paper, but the price of bitcoin should rise in the meantime.
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Sep 3, 2017 04:09
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apropos man posted:I hear what people are saying about cryptocurrency possibly amounting to nothing eventually, and personally I'll keep an open mind about that. The point of all cryptocurrencies is to sell them for more than you bought them. That's it.
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Sep 3, 2017 20:43
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Also woo another 25M tether just springing up out of nowhere, to the moooooooon
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Sep 3, 2017 20:44
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^^^ you're absolutely right that tether is a scam but tether is pumping the prices of all of the cryptocurrencies, the whole thing is a house of cardsapropos man posted:Haha! divabot posted this link in the amber thread: http://omnichest.info/lookupadd.aspx?address=3MbYQMMmSkC3AgWkj9FMo5LsPTW1zBTwXL
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Sep 3, 2017 22:00
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apropos man posted:I wasn't dreaming of buying any Tether. I just want to see the spike in Tether volume correlating to BTC. Yup, you're watching it happen in real time. The guys at bitfinex decided that they want to buy more bitcoins but don't want to actually pay for them, so here we are
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Sep 3, 2017 22:34
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Yeah, and they gave all of their customers a ~30% haircut. Eventually they redeemed all of those haircut tokens, "redeeming" the lost funds. But can anyone guess how that redemption took place? They gave everyone Tether at a 1:1 USD:USDT rate. Remember, Bitfinex can generate new Tether whenever they want, and Tether aren't actually backed by anything, so they exchanged all of the IOUs for what is basically monopoly money Anyone who's holding cryptocurrency right now is playing with fire, pure and simple. By all means, keep exchanging electricity for burritos if you don't mind contributing to money laundering and other shady poo poo, but if you're actually holding anything then good luck to you QuarkJets fucked around with this message at 23:48 on Sep 3, 2017 |
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Sep 3, 2017 23:46
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Numinous posted:I have seen this type of statement over and over and over again for years mostly here on SA. I'm not necessarily saying you are wrong, but the house has not come crashing down - in fact it just keeps getting larger and overcoming issues and the amount of people interested in it is growing rapidly to the point where professional trading industries and indeed, world level governments, are now involved. On the contrary, many predicted a big crash during the explosive growth in 2013, and then lo and behold the price crashed in 2014. And most of the same events are taking place; a big exchange loses a ton of bitcoins and eventually shuts down cash withdrawals (BitFinex vs MtGox), rampant price manipulation (the Tether Crisis and evidence of cross-exchange tape painting vs the Willy and Markus bots), and huge events that would normally crater a market seemingly having no impact (the closing of BTC-e, numerous SEC actions, and the splitting of BTC into BTC and BCC vs the closing of Silk Road and the closing of various huge scams, including the infamous Pirate Ponzi). But the price amplifiers are way bigger this time. Unlike MtGox, BitFinex was able to redeem their stolen bitcoins by convincing their customers to accept a bunch of worthless tether instead. And Bitfinex offers insane amounts of leverage for margin trading, which is not something you could do back in the MtGox days. Tons of bitcoiners are way over-leveraged, tons of money in the ecosystem simply doesn't exist, and the price graph now looks exactly like it did in 2013. The signs are all there, so now we're just waiting for the hammer to drop. When you're inside the bubble, there will always be people claiming that the bubble is the new normal and that the growth is both sustainable and perpetual. But reality will eventually reassert itself. There's no question that a crash is coming, we just don't know when.
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Sep 4, 2017 01:23
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1gnoirents posted:Wait im liable ?? Maybe; if your hardware is just being used to mine altcoins for some true believer then there's nothing to worry about, but if it's for some Russian mobster trying to launder money by buying bitcoins and converting them into altcoins then you'd probably be liable for your role in that process I guess (although IANAL)
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Sep 5, 2017 02:43
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