Let me clear up some misinformation being spouted. First of all, kraken got user funds they will be distributing next week or the following week to individuals. Secondly, settlements aren’t taxed as capital gains. Selling to pay taxes on these coins is a thing that will happen. Many people will likely owe hundreds of thousands of dollars in taxes based on their distribution regardless of what they do with the coins. The idea there won’t be selling is a fairytale.
Getting those coins back not necessarily means instant sell bc of taxes or am I wrong?
In the USA this quarter the payment date is Sept 16 2024.
So If you are a USA guy selling and paying makes sense . Now I used cap gains OGnasty thinks it reg income.
I do not know of any IRS ruling on how to classify this profit.
If it is income tax it is a lot higher rate then cap gain rate.
So a 10 coin guy could be looking at 200k tax if it is income tax and not cap gain far worse than the numbers I gave at 20%
Check the tax site I linked to the prior post.
It short, it depends on the court (how they phrased it).
That said "rehabilitation" is more like partial recovery of a temporary lost or misplaced (by the custodian) property, but tax aficionados may differ on this.
If you pay something before Sept 16 you show good faith. My guess is the rulings will be slow and paying on April 15 next year is likely to be the wrong choice.
So because there are two paths here. pay quick and you can always say I tried to do thing right or pay slow giving no defense if they make a shit ruling.
If I turned 33 coins worth 21000 into 5 coins worth 325000 I scored. I am not going to play games and I am going to pay some money before sept 16. Knowing it protects. me.
So you can be sure people looking at large fiat gains will pay even if only 1 in 3 pay now quite a bit of these coins will sell off.
Jeez, Phil, this is way too complicated for me, but as i said, I don't anticipate any MtGox coins coming to "rehabilitate" me. What a word!
That said, I agree with @JJG that selling nothing (apart from BCH, of course) is what I would have done in the situation.
With BCH everything is clear..you did not have any, now you got it with a cost base of zero, if you are going the cap gains route.