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Hi Everybody,

When getting Satoshi/Bitcoins from the internet in general, could you please tell me whether you have to pay tax to the country you get them from or do you just pay taxes to your own country?

Thanks for your help.

In USA, Depending on what your doing with bitcoin, if your mining bitcoin you have to pay income tax on every cent you make. Also if the price of bitcoin goes up even 1 cent you also have to pay a tax on that called, Capital Gains tax. In your trading bitcoin, you may require registering for a "FinCEN" as it may be classified as money transmitting. As far as I know, these taxes must be payed based of the place you live no matter where you buy the bitcoin.

I don't think you will need to pay tax when you mine bitcoin. You are required to report tax only if you sell bitcoin to fiat. In which case it is treated like if you are selling the stocks, same rules apply.

You have to pay tax on the mining of bitcoin. You can deduct things like cost of machines (depreciation) and electricity, but tax is still owed. Consult an accountant (like me) for further insight.

Really? but how to calculate the value of the bitcoin? at the time of mined? Say I got each day some bitcoins because of mining, I have to record the price that day for my tax purpose? It will be a lot of work.

Technically to be 100% right, you should record the price after each block found with the pool you are using. Of course that is not going to happen (although would be a great piece of software idea..) so instead I mine all coins to a single address that I dump at the end of each month and record my basis as that. So you owe ordinary income on that part, then any fluctuation of price when you sell the assets would be capital gains.

How do you calculate the price? Based on which exchange? Always the same one or maybe the one, which has the lowest price at the moment? Why at the end of each month, couldn't you do it once a year? Aren't you supposed to report gains only when you turn coins to fiat?
There are stances completely different to yours, for example:

Quote from: AttorneyBitcoin on January 12, 2017, 06:43:40 AM

To the best of my understanding. When I keep BTC in BTC any income I make in BTC is not taxable as to Federal Income Tax. When I cash out BTC, and have made a profit, that is taxable as income. State taxation laws will vary. Can you be more specific about the situation you are seeking clarification on please?

Best:

George D. Greenberg, Esq.

www.attorneybitcoin.com

I would say you can use any of the major exchanges, as long as you continue to use the same one. You would want to use the one with the highest price, as that would give you the most basis, but just be consistent. Would look really fishy to be jumping around all the time using different exchange prices without a valid reason.
So, to answer your second part, think about it like this. You are walking down the street and find an ounce of gold on the ground and say 1 ounce of gold is currently worth $1000. You now have income of $1000 that is due in the current year. So everything is hunky dory, you pay the tax on your fortunate find, but decide to sell the gold next year when the price is $1500 an ounce. You will now owe a $500 capital gain.
It is the same for bitcoin. When you mine, you "find bitcoins" that you would owe ordinary income on, and you would need to record a basis for. When you sell those bitcoins, you will owe capital gains tax based on the appreciated value of the coins you mined.

His response isn't different than mine, he just isn't referencing mining but is talking about buying and holding bitcoin for a period of time. You won't owe capital gains on the appreciation until you sell it.

Does that clear it up a bit?