I'm an american and an online poker player that relocated outside the usa. We have to pay taxes on your winnings when we file since its our job. I wanted to buy some bitcoins b/c i wanted a way to deposit bigger amounts into sportsbooks... heritage sportsbook and 5dimes sportsbook. I figured this was a good way to do this as 5dimes i could deposit up to 25k and heritage with 10k.
I was going to create a coinbase and blockchain acct then link coinbase to my american checking bank account and then buy bitcoin then once i have it, send it to blockchain then send it to heritagesportsbook and 5dimes. I was going to buy $1000 first just to test it out, then $5000. I read few is 1 percent or so and 0.15 so $1000 bitcoin cost me $1010.15 and $5000 would cost me $5050.15. I however read that with bitcoin you are suppose to pay taxes on it. I never invested in stocks or anything like that but i know ppl who buy stocks such as buy low then sell high, you are profiting and have to pay taxes on it. The thing for me though is i only need the bitcoin so i could deposit it into the sportsbook. Im not buying bitcoin to invest etc. Basically once i have the bitcoin, i want to deposit it asap into the sportsbook. The thing is those sportsbooks convert it immediately to usd. I prefer that since i dont want to bet in bitcoinsportsbook such as 1 btc might be 350 one day, then others 375 etc. So i want to bet flat amount and its easier with usd.
I was told b/c im sending bitcoin to a sportsbook and it converts into usd... im actually selling bitcoin. Is this true? Does that mean i have to pay tax on it the moment it convert into usd in my sportsbook acct? Example if i bought 5000 dollars worth of bitcoin and send it to blockchain then to heritage sports, i know it wont shows exactly $5000 in my heritage acct b/c bitcoin prices change a lot. So it might be $4950, might be $5020 etc. Thats true right? So if thats the case and true, then say i have just a small 3 dollar profit.... does that mean i have to pay tax on it? I pay taxes for poker and sportsbetting but the thing is this is just a small conversion and im not even withdrawing it yet... b/c if i withdraw it... assumign its in bitcoin, then the same 5003 dollar when i withdraw it to my bitcoin wallet might be a bit less than that.
I file my taxes for online poker winnings and sportsbetting if any... but are little thigns like this going to be a huge problem though? Are bitcoin buying and converting recorded? Thus the last thign i want is to have my taxes reported with my acct for my poker winnings... then later on i found out i had some 3 dollar profit on bitcoin that i have some minor issue with my taxes that i didnt know about if thats true. read that if you don't convert your bitcoin to your bank acct, then you dont' have to report it. Is that true? I read bitcoin deals with capital gains so does that mean unless i withdraw it back to usd, then i dont? The thing here with gambling taxes is it doesn't matter if you withdrew or not. Example say for the year i was up 60k. I only withdrew 25k. On my taxes, i have to report 60k, not 25k even though 25k is all i withdraw.
What really confuses me is i hear bitcoin is anonymous so if thats the case, if you converting it to sportsbook usd as you need it as a way to deposit funds into a sportsbook, would this be an issue at all. I know for ppl who are buying it for investment etc, then its different but im basically wanting it as a way to get bigger amount to deposit into a sportsbook. I could only deposit 1k max with my options in the usa at the moment. Anyone can tell me if i will have an issue with bitcoin and taxes in my case? When i first heard these 2 sportsbook accept bitcoin, my first thought was great i could get more money into a book. The thing is if i do say a bank wire or cashier check from my checking acct to it, then obviously its similar but bitcoin seem to be fast and easy so thats why i wanted to use it just buy it and use it until i read theres some tax issues. I mean... if you convert it to usd and it shows 3 dollar profit, is it recorded? Obviously for bigger amounts its important but i wanted to know like really small to almost same amounts. I just didnt know that using it to deposit into a sportsbook counts as selling it as im basically converting. I asked this in another forum and someone said its very complicated which is why i dont even want to deal with bitcoin.
Just curious if someone were to have really small capital gains like even $1, do you have to report it? Because the way i do cashier check and bank wire, i dont have to do anything additinonal with my taxes with my accountant so just wondering my bitcoin will make thigns more complicated. Again i probably just buy bitcoin few times and just deposit it asap to the sportsbook. As for withdrawing, i woudl either withdraw by check/bank wire. I might withdraw bitcoin but i think that might cause more issue which i dont want.
Would like someones opinion on this especailly if someone here who plays poker or bet sports for a living or even someone that trade bitcoin for a living though i think i want the answer from someone who uses bitcoin in poker/sports could tell me if just using it for depositing into sportsbook is going to cause much hassle.