The Best Crypto-Related Tax Advice I Could Ever Provide



right so as you guys can probably tell from looking at this thing right here I finally have my Newark still no microphone right now and so you should notice a pretty significant increase in the overall quality of the audio on these videos and if I'm being completely honest for you I don't know if I've got all the right settings and everything just yet and so I wanted to make a video today which is fairly straightforward and pretty simple for me to make not too strenuous just so that if the audio is a complete mess it's not the end of the world I'm not gonna be raging about the fact that I spent 20 minutes working on a video I can just be like oh well and make this video again for several months now there's been so many comments left on this channel asking me to make some kind of content around calculating taxes how to identify how many you're gonna own what are the relevant laws when it comes to capital gains tax and income tax and stuff like that and I've always been quite reluctant to make these videos that till now for several reasons really I mean first of all the great bulk the majority of my audience are America and this situated in the USA and I have absolutely zero knowledge or understanding when it comes to the American legal system I'm a Brit I live in the UK and so my experiences exclusively with the legal system in England and Wales but only 16 one six percent of you guys are actually British as well the rest of you are from countries all around the globe and so any information that I offer about the legal system in the UK means virtually nothing to you and I'm by no means an expert or professional whatsoever when it comes to British tax laws either and so on the whole I just don't feel qualified in any way whatsoever to really comment on these things in a Authority way that being said I did want to create a video that would provide some value to you concerning taxes and I think that actually is the best possible advice that I think I could ever give you and I really do think it will provide tremendous value to you in whatever country that you're in and whatever your personal circumstances are and that's that I think every single one of you almost if you have some kind of significant degree of many encrypts or currencies then I think you absolutely should hire an accountant simple as that I read all kinds of reasons listed on the internet about why people aren't for whatever reasons consulting an accountant even when they've made fairly significant kind of profits and gains within the cryptocurrency space you hear things like I'll do it South because I don't want to deal with the time and the hassle and pay the money for an accountant to do these things when I could do them myself you hear oh well I haven't made that much money or not that significant amount of money compared to other millionaires out there in this world and so you know HMRC or the IRS they're not going to possibly care about the money that I might have to pay in taxes and even when it comes to people who have made significant amounts of money in prep Joe's you hear them say well you know these bodies again the IRS or whatever they don't have the means or the resources or the ability to chase me down and whatever tax liabilities I might have I'll be able to get away with paying nothing at all and I just think this is a really really dangerous road to go down because regardless of whatever your opinions are on the ethics of Taxation as a whole you know setting aside that whole other argument and video that we could have about this the facts of the matter is that tax evasion is a very very serious crime in virtually all countries around the world and you can face a very very lengthy prison sentence for being found guilty of doing so and so I think you should do everything you can to try and avoid that situation entirely over the coming years is the cryptocurrency market continues to increase in size as we get to a market cap in the trillions and many many more millionaires and made over this market and now with this technology I think these bodies like the IRS are going to have an increasingly hawkish eye on all this activity that's going on and who out there is liable to pay you know decent amounts of capital gains taxes they may not have the means to chase people down right now I know that in the UK HMRC is already quite thinly stretched across the board but you never know what's going to happen in the future you don't know if in let's say the Year 2022 what kinds of crazy supercomputer or AI technology they might have by then which is able to track down even the most private of cryptocurrency coins out there how would they would do that I've no idea but you just don't know what governments are kind of working on behind the scenes and it's worth remembering as well that they'll be able to apply or use this technology and a kind of retroactive way as well and so even if they can't track down what people are doing in 2017 and what money they're making they might be able to do that several years from now and look back and say hey you know you they're pointing at you you are actually liable to pay capital gains taxes in the year 2018 you didn't why is this and they might you know pursue a criminal investigation or something you just don't know and so that's why I think you should absolutely pursue an accountant and those services to basically just absolve you of all of the responsibility because this is still such a novel realm and the kind of legal space and the tax base right now so many novel circumstances which people have never really dealt with before if even if you have the best intentions in the world and you really do mean to do everything aboveboard you may you might make some kind of mistake or you might approach a situation which there just isn't any kind of relevant precedent for you to be able to determine you know what what to do and whatever given circumstance and so again just absorb yourself of all of our responsibilities just pass it to a professional and let them deal with all of their headaches that comes from this emerging new space that no one's ever really dealt with before by going down that route even though there's a financial cost for doing so in the first place obviously to pay these people for those services at least you're also saving yourself a heck of a lot of time from saving yourself the burden having to try and understand and learn many of these policies and tax laws and pace when it comes to crypto currencies and these professionals might have knowledge about certain tax effective mechanisms or tax efficient ways of dealing with cryptocurrencies that you and I just won't know anything about at all and so in the long run they can actually save you a hell of a lot of money as well and so yeah it's because of all of these reasons that I know for sure that I'm gonna be pursuing these services have been accountant when the end of the texture comes and I have to determine my own tax liabilities with all of this stuff and I'm saying that as someone who in the past because I I do a lot of freelance and self-employed stuff I've always done that by myself but I just think we're cryptocurrencies this is just an added level of complexity and when you bear in mind the very very close hawkish eye that governments are going to have on people with cryptocurrency profits over the coming years I just think you're gonna save yourself so much drama and just sleep so much easier at night when you know that you're doing everything completely aboveboard and the only person I still really worry about all this stuff is your accountant and they have to worry that they are following all the correct guidelines and regulations which will be fairly new for them I think that's all I have to say for this video again I'm sorry that I'm not making a more in sexy video today but I just I wanted to make it something simple because I'm not sure if this is entirely working correctly I'm gonna have to spend a good couple hours getting all these settings right and check and everything is right and then we can get into making the better videos again then what are your guys thoughts on this video have you considered whether or not you're gonna seek the services of an accountant when it comes to the end of the tax year for you are you still gonna try and do it yourself if you try doing that already whilst your experience has been in the past if you've gone their own either routes either seeking an accountant or try doing it yourself whatever is going on in your mind I'd really appreciate it if you share it in the comment section down below give this video a like if you enjoyed it oh and let me know what the sound is like on this video to thank you all so much for watching and I'll be back with more videos very soon Cheers

50 thoughts on “The Best Crypto-Related Tax Advice I Could Ever Provide”

  1. I'm a CPA. I've been interested in Crypto for about 5 months now and have a few holdings. I'd be happy to help anyone out if they have any questions!

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  3. Hey there! Check out BearTax www.bear.tax to calculate your capital gains and let us know your feedback. If you are a CPA, approach us via support email and we've a special product for you.

  4. Follow this link for my video overview, I am an experienced cryptoCPA: https://www.youtube.com/watch?v=2NgCA_lHUcI

  5. i used software to calculate and file my capital gains for crypto this year. It was super slick www.cryptotrader.tax

  6. It could be a gigantic mistake to declare "Crypto earnings" (ie the strange thing they define as "Capital Gains") because then your completely private resources of Crypto are brought out into the open and they now know you've got them. So they can now hound you for the rest of your life. Once you've opened that Pandora's box then it can never be closed again. I say be very wary of getting involved with tax authorities OR with accountants. Keep your Crypto CryptIC !

  7. Governments are increasingly broke – I think they are certainly going to come after any crypto profits people have amassed.

  8. I just got into Crypto August 2017 and will see my tax man for regular tax return as usual, but now will add the Crypto component to that. I hope he can handle Crypto!
    I hope I'm right that Crypto to Crypto trades aren't subject to capital gains taxes for 2017 ?. I know that they are for 2018 with the new law. All of my trades have been C to C thus far no C to fiat.
    Your advice is well taken since I like to sleep at night.

  9. The real question is how the hell can the IRS keep track of any trades on decentralized currency on a exchange?? Someone please answer this question..

  10. AMERICA, a place where if you are a banker or a politician and you do something shady or corrupt you're off the hook, but if you trade some virtual coin that according to the government has no value, but they still want your cash. . . right….

  11. Hodl what you invest in for years, most likely in a cold wallet like the Ledger Nano S, and when the time comes and you are going to sell your coins then seek help from lawyers etc so you know that what you are going to do is done correctly. Thats my plan anyway.

  12. Hey Louis, great video. If we can be of any assistance out of our CryptoTaxPrep.com division we are happy to help with tax prep or even pre-filing advice. 😉

  13. buy verge (XVG) and hold to support them and then more places will accept. Then more likely to get away with not paying taxes.

  14. Gambling which meaning the actual players who play the games like roulette, horse racing fobt's etc is tax-free in the UK, but not the casino house or bookmakers they have to pay tax.
    Crypto investing is also a gamble , punters are speculating they make their choices lay their money down then wait & see.
    That is gambling values vary up & down there are winners & losers. The taxmen should keep their noses out.
    There are those on minimum wages who work 40 hours every week & pay tax about £150 a month forcing those workers in near poverty while property sellers can profit a clear £100k over what originally paid in just a few years & get-away Scot-free.
    Tax preferences is a mess, anyway Crypto investing is gambling therefore cannot be taxed until that law is changed.

  15. We need to challenge this and get some good attorneys. Cryptocurrencies are "like kind" with each other technologically.

  16. It is called Bitcoin wall? I hear many people taking about Bitcoin wall.Probably one of Donald Trump strategy. I am wondering who sign that Bitcoin tax bill?

  17. Have you looked into the non habitual resident program in Portugal? You can pay 0% income tax on your crypto gains and online income if you spend half the year in sunny Portugal.

  18. I am pretty sure my accountant has never even heard of bitcoin let alone altcoins and tokens, nor have the HMRC , its not money so they keep telling us so why would you pay tax on it……….and how would you work out your tax when today BTC is 11000 and two days ago was 16000 …………as Bix Weir pointed out only when transacted is a taxable asset

  19. Have your barber use a 3 all the way up on the sides of your head. Right now its makes it shaped like a diamond or a triangle. Great videos man

  20. The quality of your sound and video is very good. No need to change anything there. The content is also good because you keep it simple and base your opinions on established facts. As for the tax issues you are completely correct about why you should leave it to a trained CPA. Tax laws change every year and it's a full time job keeping up to date on everything. Spend your time doing the things you are good at and that you wouldn't trust someone else to do. Like buying and selling crypto.

  21. https://www.taxjournal.com/articles/taxation-profits-cryptocurrencies-18102017 it's all taxable and please watch out for VAT thresholds to suit. Any UK queries, fire em over and I'm happy to help this amazing community 🙂

  22. Anyone know whether the capital gains tax liability applies when the profits land in your bank account, or is it when the transaction occurs on the exchange itself, i.e. selling BTC to buy USD?

  23. Hang on…As a currency, how is there ANY tax liability…

    One doesn't owe the taxman when you change your money to a lower valued Euro before you go on holiday and, nor do you owe them anything when you find out that the pound has devalued so much that you can now buy twice as many pounds as you started with when you change your euros back after you get home…

    Currency fluctuation and Inflation does not equal gains…

    Or have I missed something?

  24. The very fact you get longer jail time for tax evasion than for murder really proves how psychotic maniacs are running the western world. The governments and central are CRIMINALS, end of discussion.

  25. Hey, im from the UK, Manchester. Would it not as come under spread betting which is'nt taxable? love the vids!

  26. I'm a crypto investor & FINRA registered wealth manager based in the US. I work with individuals who've made substantial gains and need advanced tax planning strategies. If you have questions, or even if you haven't made substantial gains but you're seeing the return potential on smaller investments, I'm here to help. I really enjoy discussing the exit strategies whatever your basis may be. If you don't have any coin, I'm not offering to hold your hand. Again, if you're in the ring with me, let's chat. If not, pay attention to your risk tolerance & don't go against your gut.

  27. Just to add to the comments I have previously made about cryptocurrencies including taxation and Money Laundering. All these things are firmly on the UK Governments radar.

    http://www.independent.co.uk/news/business/news/uk-bitcoin-regulation-money-laundering-crytocurrency-european-union-eu-a8090791.html

    Avoid these issues at your peril if you live in the UK and be sure that the US authorities will be thinking along similar lines.

  28. Why dont they just keep all the taxes the same as they are now and just dont tax crypto? Because surely once we withdraw for fiat and purchase something it will contribute to tax revenue? Or if we chose to pay via crypto selling firms have to legally log it as crypto transaction thus they impose "crypto tax" when using crypto thus it will cost more if you pay with crypto?

  29. umm what if you just use bit coin ATM's that would avoid a few headaches and I guess their hi fees would cover you and them partly for tax liability.

  30. I use this as a general "guide" for figuring out what information I should be keeping. I also plan to use an accountant, since I did so last year (before getting into crypto) anyway.

    https://www.reddit.com/r/Bitcoin/comments/1uccfz/i_am_a_tax_attorney_here_are_my_answers_to_the/

    generally, I treat same-year trades as marginally taxed and gains from "hodling" that go over a year as capital gains. selling crypto1 for crypto2 means you may incur gains that are marginally taxed. Say you bought bitcoin for 1.00 and traded it at 1.07 for 100 ether. You'd pay marginal tax on 0.07btc and whatever happens to your ether coins depends on what you do with it (say you sold it for btc when it goes up, you pay more marginal tax)

    Do you have to do this? can't say. But if you ever get audit and it can be shown that you sent 3 bitcoins into an exchange in june, and the bitcoin ledger shows that the coins were swept into another wallet, and then you suddenly got 28000 USD in your account… you see where i'm going?

    pay your taxes. for now even if you are ideologically against it, the tax man is powerful enough to take down mob bosses. you can't defend or justify tax dodging

  31. Every year of my life my taxes have gotten a little more complex so I feel like I've worked my way up through business, investing, real estate, trading, etc and cryptocurrency isn't that much of a leap, it's just a LOT of transactions to track if you are an active trader. That said, I am happy to do a lot of research and take the time to get it right–I don't recommend it for most people because most people get overwhelmed with even the idea of tax complexities. If you do want to do your own taxes I recommend Bitcoin.tax as they will pull in your trades from exchanges and calculate your taxes and generate the forms to include with your return. I use TurboTax online, you can input your trades if it's just a few but if you have a lot of transactions you'll need to print them out and send them separately. You can also buy a kind of audit insurance with TurboTax and with most tax prep services which can be a middle ground if you are worried. I definitely agree with you Louis that the government will use AI in the future to track down tax evaders and blockchains being open, transparent, immutable ledgers, it's a pretty bad way to evade taxes. If they can get mobsters who are professional criminals on tax evasion, I think they will be able to catch the average crypto user.

  32. No state is currently regulating crypto, thus no regulators to pay, thus no reason to pay taxes. At this point, it's criminal for tax collectors to steal some of the pie that they had no part in making. But thugs will be thugs.

    So the answer is just how much do to play along with thugs, are you a thug, etc. I tend to want to fight back.

  33. sound is all good for me…. as for an accountant get one without fail…. hving just had a run in with HMRC that has jut cost me £5K from the past 4 years (not crypto related)…. they will find you they will tax you and they will fine you and they will add interest on your debt for not paying tax on earnings…. a good accountant will save you what they charge and even if they don't they will save you money in the long run

  34. Qash dude.. are you in? I absolutely love what these guys are doing. You may have mentioned them I'm not sure

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