Re: Has anyone sold BTC won here in sig campaigns? how does tax work?
Mintpal dies out of nowhere and now you don't have your account anymore. How do you prove the origin? and if you can't prove the origin, you are fucked.
You can prove the origin of your coins, though. Let's say you have some signature campaign earnings as the OP indicates. Those transactions and the threads that describe them are archived. You can sign an message from your receiving address. Mintpal's wallets are (or can be) identified. You can show the transaction from your campaign receiving address to Mintpal, and you can show a withdrawal from Mintpal (on the blockchain) to an address you control.
Segwit's scripting complicates this, but this wasn't an issue in the days of Mintpal.
Similarly, if you wired money to an exchange to buy BTC, you can show bank records that reflect that. And you can show withdrawals on the blockchain that reflect your BTC holdings from that transaction.
Can you explain how do I prove that:
1) I sent my coins to a Mintpal deposit
2) I withdrew the coisn to a Mintpal deposit
If mintpal doesn't exist?
Exchanges create deposit and withdraw amounts for each individual account and the exchange is dead, im not sure how this could be proved. All that there is is some transactions in the blockchain which would be anything.
As with other IRS investigations, they would need to prove that you received income that went unreported. The only way that your trading records can be disproven is by direct coordination with an exchange. If an exchange did not enforce KYC, this becomes difficult. I think that blockchain records reflecting the coins under your control during the relevant times are more than enough to show good faith effort. I think this is especially true in the case of exchanges that disappeared.
About unreported income... if you receive an income here in exchange of working in signature campaigns, as soon as you give them one address, they could link it to an account, the look for every address ever that you used with your account and they could see how much money total you've made with your account, and then accuse you of not having reported that income when you sell a part or all of it. So im not sure how this could work out.