IT'S OVER for crypto bros: taxes

Look at pic related. Even if you make $187k per year from passive staking, you actually end up with ~$61k after taxes.

Tax rates are based on Australian tax rules. Fuck this gay earth. I was planning to live off my Link eventually but I will need way way more than I thought.

In summary:
>Get staking rewards
>Have to pay tax on staking rewards (even if you don't cash out)
>Sell tokens to pay for that tax bill
>Pay additional CGT on tokens you just sold
>Finally, you paid off tax on your rewards, but now you're left with tokens instead of fiat
>Sell what's left of your rewards tokens to have some spending money
>Pay CGT again

  1. 2 weeks ago
    Anonymous

    Thats got to be wrong

    • 2 weeks ago
      Anonymous

      Literally follow the calculations there. If you see something wrong, let me know. This thread is intended to educate anons on our folly. We really have to aim for massive returns to make it.

      • 2 weeks ago
        Anonymous

        Theres no way $187k turns into $61k after taxes

        Youre double/triple dipping

        • 2 weeks ago
          Anonymous

          You're right that it's wrong.
          I used ultra-conservative tax rates. 45% tax rate I used only applies for every dollar earned over 180k, below that it is ~37%.

          I rechecked using correct tax rates (37% for every dollar over 120k, + $29500 flat), and it ends up that you get to keep $93k after all taxes, from a $180k starting point.

          • 2 weeks ago
            Anonymous

            Yeah this is more accurate. How fucking cucked is it you get to keep a bit over half if you are doing really well ($300k+). If it fits your circumstances I would definitely consider moving countries if you are actually in the situation in OP

      • 2 weeks ago
        Anonymous

        >45% tax

        Well there ya go. That’s wrong

    • 2 weeks ago
      Anonymous

      yeah the taxes are probably higher

  2. 2 weeks ago
    Anonymous

    [log in to view media]

    But I don't pay my taxes.

  3. 2 weeks ago
    Anonymous

    just use a wallet that cant be traced to you and swap it into monero and buy gold online with it and find some boomer to sell it to slightly below market price to cash out

  4. 2 weeks ago
    Anonymous

    Here tax 15% when you turn to cash but i dont pay it

  5. 2 weeks ago
    Anonymous

    buy xmr and also have sex

  6. 2 weeks ago
    Anonymous

    Why not fuck off out of Australia? I pay 10% / profit taxes on crypto.

    • 2 weeks ago
      Anonymous

      Which country?

      • 2 weeks ago
        Anonymous

        Romania. Yes, it's eastern europoor, but shit's cheap ( you can rent 2 rooms for like 3-400 euros a month. at 6-700 a month you live in cool looking condos ).

        • 2 weeks ago
          Anonymous

          Ah better then Serbia we 15%

    • 2 weeks ago
      Anonymous

      Damn, if my country only wanted 10% I would have actually cashed out back in November

  7. 2 weeks ago
    Anonymous

    How often are rewards paid out? It seems like you're assuming that the rewards are paid only once when the price is at $1500 and so you have to pay taxes on every single token as if you received it when the price was $1500. However if you're receiving rewards daily, for example, you have to individually keep track of the price of each batch of rewards on the day you received it. So let's say, in theory, you receive 1 token per day. You might have 1 token that was worth $20 when you got it, 1 worth $37, 1 worth $55.43, and so on.

    • 2 weeks ago
      Anonymous

      [log in to view media]

      Emphasis on "at the time they were received." So if you're relying on the spreadsheet in the OP then you're overpaying massively, unless the price instantly jumped to $1500 when you started staking and remained constant while you accumulated those 125 tokens in rewards. In reality you'd probably owe much less than half of what your spreadsheet says if you're properly keeping track of the price of each batch when you receive it.

    • 2 weeks ago
      Anonymous

      I simplified it and assumed that in the tax year it stabilised at $1500, and paid out all at once. But see here

      You're right that it's wrong.
      I used ultra-conservative tax rates. 45% tax rate I used only applies for every dollar earned over 180k, below that it is ~37%.

      I rechecked using correct tax rates (37% for every dollar over 120k, + $29500 flat), and it ends up that you get to keep $93k after all taxes, from a $180k starting point.

      , I actually used some wrong tax rates.

      Secondly, this only applies until you have sold off your original stack, which you got for cheap (in the OP scenario). Because you are paying CGT out the ass because they are worth way more now than when you bought. Once the original stack is sold (about 20 years in the OP scenario), and you've only got staking rewards (which you already paud income tax on during those 20 years), you will no longer be paying CGT + income tax. It would only be income tax, assuming the price never went above anymore $1500 🙂

      • 2 weeks ago
        Anonymous

        Well, then you WAY oversimplified it to the point that it's basically meaningless. AFAIK most chains pay staking rewards daily, or every 3 days, or every week. So in a REALISTIC year-long bull run scenario where the price slowly climbs from $10 to $1500, you're paying MASSIVELY more in income tax than you should be because of this oversimplification.

        • 2 weeks ago
          Anonymous

          No it's not worthless. I see your point but we're talking about different times here. I'm talking about living off staking gains AFTER the bull-run and the price has stabilised, for projects with good fundamentals.

          • 2 weeks ago
            Anonymous

            [log in to view media]

            Well, even then you're way off.

            • 2 weeks ago
              Anonymous

              >pic
              Ok, now you have to sell some crypto to pay for the $55k tax bill. And then you end up paying tax again (CGT this time) on the crypto you just sold. That's what the OP pic is taking into account.

              • 2 weeks ago
                Anonymous

                You said this is after the bull run price has stabilized, presumably at $1500.

                If the price has stabilized and all your rewards were worth $1500 when you received them, then you owe $0 in CGT when you sell them to pay your income taxes because they didn't grow in value between the time you received them and the time you sold them. You only have to pay CGT when you start dipping into your initial stack of 2500 which gained $1490 each in value.

              • 2 weeks ago
                Anonymous

                Ok, we're on the same page now. You're right about having 0 CGT, but that's only if you use HIFO (Highest In, First Out) or LIFO (Last In, First Out) as cost-basis.

                Unfortunately, the crypto tax calculator I use only seems to allow FIFO (First In, First Out) which means paying CGT until the original stack is sold.

  8. 2 weeks ago
    Anonymous

    Don't report crypto gains, just send it all to an xmr wallet and buy cupons the IRS won't check the transactions of tens of millions of people, if they go after people, will be whales...

  9. 2 weeks ago
    Anonymous

    Anyone paying taxes on crypto is a retarded fucking hypern-word

  10. 2 weeks ago
    Anonymous

    [log in to view media]

    >paying taxes to government who hates you

  11. 2 weeks ago
    Anonymous

    LoL taxpayers

  12. 2 weeks ago
    Anonymous

    [log in to view media]

    OP, this is all wrong. You are fucking retarded.

    • 2 weeks ago
      Anonymous

      Literally none of it is wrong aside from the tax rates used. Refer to my other posts ITT, you get to keept 93k out of 180k by Australian tax rules.

  13. 2 weeks ago
    Anonymous

    Have you tried not living in Australia?

  14. 2 weeks ago
    Anonymous

    [log in to view media]

    >paying taxes
    just use monero

    • 2 weeks ago
      Anonymous

      You have to exchange monero for dollars at some points, retard. Using an exchange. Which sends all the transactions to your country's IRS equivalent.

      • 2 weeks ago
        Anonymous

        You know dex swaps are possible and off the ramp?
        Also p2p?

        • 2 weeks ago
          Anonymous

          Retard, unless you get hard cash in your hands for your crypto, every single fucking dollar that gets on a debit / credit card you own will have to be accounted for at one point, especially when it's in the order of tens of thousands of dollars and more.

          • 2 weeks ago
            Anonymous

            Never in my life i used bank or credit card.

            What moron would use bank and then monero.
            have a nice day.

            I literally make purchases/salles 10-50k crypto cash in or out.
            Use dex you moron,non kyc exchanges,swaps.

            Ye every dollar get on my bank account later but its easily washable if you know how i have few private bussineses/locations 😉

            But probably its more strict on west.

            • 2 weeks ago
              Anonymous

              Oh ok let me just open up private businesses that will cost even more money and then go through all the fucking hassle to go around the country and get cash instead of just paying 10% and having it directly in my account. You're a fucking moron.

              • 2 weeks ago
                Anonymous

                You are supposed to have it...
                And no annon one of buss i had as side hustle is me renting it.

                You are supposed to have it annon and have something for yourself.
                Its not my fault you are poor anon.

              • 2 weeks ago
                Anonymous

                You are either living in a shit place where crypto taxes are so high it's better to open businesses and try to launder profits or you are a total fucking moron paying extra.

              • 2 weeks ago
                Anonymous

                15% tax.
                With that money i just open new shit and reinvest anon.
                You are supposed to reinvest money anon.
                Learn principles.
                I always will invest in new bussines and get money from that.My crypto and washing is just side stuff and it pays off very nice on long run.
                Trust me it does.
                On one sale p2p i saved 15% washed it cause why not and got myself nice car anon.
                Rest legal money go to stocks or will see what next its long run.

                Fun fact we didnt even had taxes on crypto till this year so it was good and intend to abuse this long as i can.By look of it i just might.

              • 2 weeks ago
                Anonymous

                Oh, you're the Serb. Yeah, of course you can do that shit. Good luck once you're in the European Union.

              • 2 weeks ago
                Anonymous

                Well yea maybe you right.
                However that movie we wont watch for long time.

      • 2 weeks ago
        Anonymous

        >Using an exchange
        no you don't

  15. 2 weeks ago
    Anonymous

    >Australia
    Taxes would be substantially lower even in Caliwali

  16. 2 weeks ago
    Anonymous

    In the UK I believe that dependent on the type of staking (i.e. if it leaves your wallet) it's considered disposal of assets (no different to selling them) which is also a taxable event. Wtf.

  17. 2 weeks ago
    Anonymous

    [log in to view media]

    UPDATE.
    OP pic used the wrong tax rates. See pic attached. There are literally no errors here.

    Caveat: This is heavily dependent on your initial buy price. If the token price went up 150x from when you bought it, you can exoect a heft CGT bill on top of the income tax. Our example assumes 150x.

  18. 2 weeks ago
    Anonymous

    [log in to view media]

    The taxes, I'm just not going to pay them

    I know....UGH, I know, I'm sorry

    I'm just not going to pay them is all

    HAHAHAHAHA

  19. 2 weeks ago
    Anonymous

    Are you just planning on hoarding this money and doing nothing with it? start a business, charge your expenses (which, if you do it right, includes many expenses you would have had anyways) against your taxes and you can bring down that total number you need to pay by a lot. There's also business tax rate, considering your capital gains as the income of a corporation gets taxed more lightly than that of an individual. Depends on your country/state though ofc

    • 2 weeks ago
      Anonymous

      >your capital gains as the income of a corporation gets taxed more lightly than that of an individual
      Holy fuck, normal people are just treated as slaves for rich businessmen. What a shithole country

      • 2 weeks ago
        Anonymous

        >what a shithole country
        I didn't mention a country because this is how it works all over the world as far as I know. And I get where you're coming from but it makes sense IMO. no matter what the money gets taxed at the same rate when it gets paid from corporation to individual, but the key thing is you can leave money you arent going to spend inside the corporation structure to shield it from tax.

        like, if you start a LLC, the LLC makes 100k, and you pay yourself 100k, you get taxed on that 100k income just like if you'd never made the corporation in the first place. but if the LLC makes 100k and you pay yourself 50k from that, the 50k left over in the LLC is taxed at a much lower rate because it is assumedly being withheld for business expense purposes

        This is how every person with actual wealth retains their money btw. it's like tax management 101. if you take a larger personal salary than whatever your immediate personal yearly expenses are then you're a chump

    • 2 weeks ago
      Anonymous

      example: start a crypto management LLC, and under the umbrella of your LLC, out of the 180k income, spend 100k of it buying more link. This 100k is now a business expense that you can effectively use to bring your taxable income down from 180k to 80k

      but that's just an example, it doesn't have to be isolated to crypto only. For another example, if I had that kind of income I would hire my friends and start a game studio. This is the intentional incentive structure of how these taxes work, that you're going to lose this money anyways so you might as well spend it on something generative which ideally makes you even more money even more quickly

  20. 2 weeks ago
    Anonymous

    >$61k
    I'd better keep smoking weed while I wait for my qom bags to take me to tax hell

  21. 2 weeks ago
    Anonymous

    You have to pay taxes in pretty much every country on earth

    Complaining about it won’t do anything, if you care so much you can live in sand n-word dubai but good luck with that

  22. 2 weeks ago
    Anonymous

    >Taxes
    n-word I am not even a legal resident - if I am caught and thrown out nobody ever knew I owned crypto. Check m8 tax fags

  23. 2 weeks ago
    Anonymous

    Fuck me you're a dumb cunt. You pay 55k tax on 187k. You're having a cry over making 132k per year?

    • 2 weeks ago
      Anonymous

      You think 55k is nothing to cry over, retard?

      • 2 weeks ago
        Anonymous

        It is what it is, just suck it up or fuck off to a third world country where you don't pay tax. My bill last year was over 500k.

        • 2 weeks ago
          Anonymous

          >My bill last year was over 500k.
          Sure it was. Is it the equivalent of 50 dollars in your shithole's currency?

  24. 2 weeks ago
    Anonymous

    lmao who the fuck cares about Australia? i cash out all my crypto thru my 3rd world wife's SEA n-word bank account, instant p2p sales with no fees, no taxes, and 5% MORE on the USD amount lmao. l2play bro

  25. 2 weeks ago
    Anonymous

    the laws will change with more time and adoption in the space. fuckin despair doomers are so annoying.

    do you really think America won't want to stay competitive in the crypto space if other countries make enticing propositions through taxes?

  26. 2 weeks ago
    Anonymous

    >Have to pay tax on staking rewards (even if you don't cash out)

    Not really, according to current IRS guidelines yes, but you would likely win if you went to tax court because you don't have immediate access to sell funds from staking rewards. There isn't precedent yet but most people are treating staking as income when you actually first collect the rewards.

    >Pay additional CGT on tokens you just sold

    You only have to if you have capital gains. If you claim staking as income, then your cost basis is the fair market value at the time you received the rewards, so if you immediately sell it around the same price, your capital gain is around 0. If the price goes down you can actually book losses.

  27. 2 weeks ago
    Anonymous

    >gradually i began to hate them

  28. 2 weeks ago
    Anonymous

    Just don't pay, there is no way to prove a cold wallet is yours, you could have sent 1 eth to someone for payment at some point. Doesn't mean its your wallet and tax authority has no way to prove it. The only wallets PROVEN to be yours are exchange wallets where you have to KYC to the gills, and its the exchanges that comply with tax regs and report their own customers if they trade more than X amount per year, typically.

    Coinbase reported me for more than £10,000 of transactions in one year for example, so I squared up with tax owed. But metamask shit? Nah, I'll just pay my CGT when I cash out on an exchange, thanks.

  29. 2 weeks ago
    Anonymous

    Stop being a retard and just become a "freelancer" who receives his payments in crypto and pay an income tax.

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