Crypto Asset Inheritance Planning- A Comprehensive 2020 Guide

Currently working intern at a company and just received a large windfall due to inheritance from family member, how do I legally invest a large portion into stocks and cryptocurrencies in the US?

I'm already making a decent amount at the company while finishing up my 2nd BA and working towards Masters. Due to the death of a family member, I have received a fairly large (by state standards) inheritance. How would I go about investing 75% into retirement/investment and 25% into cryptocurrencies?
I know I should invest the 75% into my growing Index Fund (already have one, but not alot in it). However, I'm curious about how to legally invest and pay taxes on Cryptocurrencies. I already own a couple Bitcoin and various other crypto's due to the EXTREMELY early days when I was starting Highschool due to my uncle who gave me some as a gift for my Bday, however I have not paid any taxes on them as it wasn't required at the time (this was late 2011, early 2012 ~) . I heard there was new rules and laws dictating currencies and such. Do I have to pay taxes on the crypto from 6+ years ago?
For the amount I'm planning to put in is greater than 10k, I already have a coinbase, binance, and bittrex account. I heard they automatically report to the irs after a certain amount. Again, I'm not looking to break any laws, just asking for what I need to do legally.
Posted here instead of personal finance since it got removed.
submitted by Kingflares to CryptoCurrency [link] [comments]

My List of Crypto Tax Questions

1.) Are crypto transactions pre-2018 like-kind transactions?
2.) If you invested in an ICO through a SAFT, what is the cost basis for the token?
3.) Can you participate in a syndicate and pool money as an investment club? SPV? LP?
3a.) If someone invests through a SAFT, but pools money, is the person signing the SAFT responsible for all taxes or can they distribute the taxes to pool members? How?
3b.) Is the taxable event when you send to the pool or when the syndicate leader sends to the SAFT address?
4.) How do wash sales work for crypto?
5.) How do you report transactions from a DEX if it doesn’t store records of transactions?
6.) How do you report privacy coin transactions?
7.) If there is a theft or loss, is it based of your original cost basis or the fair market value at the time of loss?
8.) Do you have to file a FBAR for using a foreign exchange? For using a hardware wallet?
9.) Can you share a wallet with a friend or family member?
10.) Is giving a gift of 1 eth first considered cashing out into USD and therefore a taxable event before the gift?
11.) Are you able to choose between FIFO, LIFO, HIFO, or Specific Identification?
12.) If you want to cash out a token into USD but you first have to go through ETH to cash out on Coinbase, does FIFO apply in this situation, forcing you to cash out your oldest ETH?
13.) Are unwanted airdrops taxable? What is the cost basis? What if you are spammed with unwanted airdrops?
14.) Is the Bitcoin Cash cost basis when the fork happened or when it was airdropped by Coinbase? Is the cost basis for a forked coin always $0?
15.) Can you file as a 474 MTM day trader even though crypto is considered a property?
16.) Is changing a place holder token like EOS into a main net coin a taxable event?
17.) How do you treat transaction fees for just sending crypto between wallets?
18.) Are transfers considered taxable events? Coinbase seems to think so.
19.) How would using a ETH lending platform like SALT, Sweetbridge, or Maker, be looked at tax wise? Is it considered cashing out and a taxable event?
20.) How do you calculate taxes for margin or futures trading?
21.) Is it a company expense if you use utility tokens like ETH to make your dapp function?
22.) Can you write off investing in a non profit coin on your taxes?
23.) What is the cost basis for someone that was given a Bitcoin? What is the cost basis for someone who inherits a Bitcoin?
23a.) What if the donors basis was higher than the market value of the Bitcoin at the time of gift and there was a capital loss?
24.) What is the cost basis for crypto donations? If you bought BTC at 20k and now it is 8k, can you claim a deduction for the 20k cost basis?
25.) Is it possible to invest in crypto through a Self-Directed Roth IRA so you don’t have to pay any taxes on capital gains one day?
26.) Do you have to file a Section 83b election for all tokens received as income, including advisor tokens?
27.) Is buying a coffee with Bitcoin a taxable event?
submitted by speedyarrow415 to ethtrader [link] [comments]

I hope we're all having fun with garlicoin. I put together a small guide for anyone who is interested in getting into trading crypto in general.

(This guide will not help you set up a wallet or mining for garlicoin. You can find that information on the official Discord or the offical website listed in the sidebar on the right.)
There's a buttload of coins out there. Some of them were made for fun, like garlicoin, or are unlikely to see the development they need to provide a use for the coin. A lot more are already in use in various ways or look to have a promising future. There's really no obvious rallying point for new people getting into crypto. If you want to discover this world, most sincerely, you may want to start by lurking on /CryptoCurrency. There are a lot of new people dipping their toes in crypto right now, and many have the same questions. Seriously, lurking on /CryptoCurrency will do you a lot of good.
That said, if you want to trade crypto currencies, the steps toward making that possible are quite simple. There are, in short, four things you need to do (And the fourth is optional).
1. You need to get your hands on some crypto. Mining is really bloody slow for any coin that is already populaworth any meaningful amount of money, so you almost have to buy some crypto with 'real'/fiat money. There are a few exchanges that do accept normal money, but importantly the exchanges you want to spend most of your time on don't. In short, laws and regulations are a lot more stringent for exchanges that let you trade with normal money, so most exchanges don't. But as I said, a few do. The biggest exchange that takes normal money is Coinbase. I must disclose however that I have never used them. I used a competitor called Bitpanda. Using Bitpanda was a quick and painless experience for me, so I do recommend them, however the googles tell me that they charge 1.5% more in fees than Coinbase do, so I'll leave that choice up to you. What you want to do is pick an exchange, create an account, and then get verified. Regardless of the exchange you pick, you are pretty much going to have no choice but to show them your ID. The governments of the world get awfully interested in any company that accepts large amount of 'real' money in exchange for magical Internet buckaroos. Getting verified makes it a lot harder for you to hide your money for tax/divorce/inheritance purposes, so please don't go into this with the intention of trying to deceive your government. Once you are verified, you will be able to purchase your first coins (except garlicoin, the trebuchet of cryptos, which we'll all get to mine together). Now, you will find that there aren't a lot of options. Depending on the exchange, you are likely to be able to buy Litecoin, Ethereum, Bitcoin, and maybe one or two others. Bitcoin is the most famous, of course, but in preparation for step two, you may want to choose one of the other coins your exchange offers, since they have lower transaction/moving fees.
Lastly for this step, remember, you absolutely do not need to buy whole coins. You can buy a tenth of a coin if you want. Everyone in crypto thinks the market is going to continue to grow, but it could crash at some point and not recover for years, so... Don't invest money you can't afford to lose or lock up for a long time. And especially do not take out any loans. Jesus Christ, do not take out any loans.
2. Move your money to the main exchanges. You have some crypto! Woo! Unfortunately, the exchanges that accept normal money kinda suck for trading. The fees they charge are way higher than the fees on the main exchanges, and they only deal in a few different coins. So basically, they are only good for moving normal money into crypto and vice versa. So what you want to do now is you want to move the coin you bought to one of the main exchanges. The most popular one bar none for crypto/crypto trading is Binance. Binance has had to close the registration of new accounts for a while recently, but as of a few days ago registrations are back up. There are a lot of competitors to Binance. The one that grew the most during Binance's registration closure was Kucoin. There are dozens of others, but they tend to have much lower trade volumes. It's entirely up to you where you go, but these two may be a good starting point. Binance is the largest and has the most trade, and many coins to choose between, while kucoin has some promising looking small coins that are not yet on Binance. Among the smaller other exchanges you will find dozens and hundreds of even smaller and more unknown coins, but many of these may be actual shit coins that will slowly fade away and die, and any money invested in them will just be lost. Of course, no doubt there are many nuggets of gold out there too. So whichever exchange(s) you go with, and whichever coins you decide to trade for, do some research first. This goes ten times over on the smaller exchanges, but is important even on Binance and Kucoin. Whichever exchange(s) you go with, go your funds/asset page, find the deposit wallet address for the coin you have and withdraw from your first exchange and send to that address. Do not send to the wrong address. Do not send Bitcoin (BTC) to an Ethereum (ETH) address. If you do, that money is lost forever. Yes, really.
3. Trade. There are two main ways of trading crypto, and most of us do a little bit of both and fall somewhere on the spectrum in between. These two are hodl and daytrading. Daytrading is the same as in stocks. All coins tend to go up and down a bit every day. Back and forth. So if you are lucky or patient enough, chances are you could for example buy a coin at $2 apiece, then sell them for $2.1, then buy again at $2... Of course, this is basically gambling, and the coin you bought at $2 could go down to $1.5. But if you put some effort in you can usually come out ahead. The other way is to 'hodl', which is just a meme name for picking a promising coin and hold on to it come hell or high water, because you think that in the long run it's going to increase greatly in value. Holding on to a favoured coin is often the smartest thing to do, because if the coin really has value, sooner or later more and more people will think so too and the price will rise. Ethereum for example is worth about $1000 per coin now, but it started out trading for under a dollar. It's important to remember that ultimately, the price of a coin is 'supposed' to reflect how useful it is. Every coin has some function it is supposed to fill, whether that be the increased privacy offered by privacy coins or enabling other coins to act through them, or competing with ads for website revenue generation or what have you. A lot of people are in crypto to make money speculating, but the foundation upon which all of that rests is the belief that most of these coins have actual, real world applications, either now or on the horizon. You forget this at your peril. /CryptoCurrency has plenty of discussions about the different coins out there, and just about every coin has its own dedicated subreddit where everyone on it is convinced that their coin has a bright future. A lot of them are right, too. But it's important to remember that the people on those subs are self selected for believing in the coin, and it's always a good idea to try to understand why others don't love the coin. Ultimately the best way to determine whether a coin has good potential is to 1. read the white paper (Most people don't, but they really should...), and 2. look up the team behind the coin (Most people don't, but they really should...). The shortcut is to just absorb the general mood on the various crypto subs and other crypto communities, but if you rely entirely on that you'll be surprised every time the community in general is surprised. Knowledge is a very important edge, whether you want to daytrade or hodl, and it's a tool a lot of people don't have. On the other hand, the mere fact that a lot of people believe in a coin is often enough to (temporarily) raise its price even if the coin is ultimately doomed to fail. So ride that wave if you wish, but at that point you're pretty much just gambling. Odds on the crypto market are better than at casinos, but even so. Be careful. And if you enjoy yourself, do take the time to get to know some of the coins. Really, it's fun and interesting and can save/make you a lot of money. Even if you're just in it for money, it's still the smart thing to do.
4. Decide where you want to keep your coins. You have two choices. You can keep your money on exchanges, or you can withdraw your coins and store them in a wallet. Personally I don't have all that much money, and I am content to have it spread out on a few different exchanges. However, a lot of of people are not comfortable leaving their coins on exchanges, because if it is hacked or goes under those coins are easily lost. This is unlikely to happen, especially on the bigger exchanges, but there is no doubt that getting your own wallet is safer. Different coins require different wallets, but a little bit of googling and double checking crypto forums can easily find a wallet that will work for your coin. The only downsides to keeping coins in your own wallet is that there is a (usually small) fee to withdraw coins from exchanges, and if you later want to trade your coin for something else it'll take a while to transfer it back to an exchange.
...And that's it, really. I will list a little bit of advice below, but this is all you 'need' to know to get started.
  1. Be really, really, really sure that you use the right addresses when you send coins. Sending Bitcoin (BTC) to an Ethereum (ETH) address will result in you losing that money forever. There is no bank to call up and do a charge back. The exchanges can't help you. Nobody can undo your mistake if you send money into the void. So make damn sure you are sending your coins to the right address.
  2. There are real scams out there. We are still in the early days of crypto, and it's pretty lawless much of the time. If someone is explaining to you how to send your coins around, and then give you an address to send to, that's not your address. That's theirs. And if you send them your money, it becomes theirs now, and good luck finding a random stranger on the Internet to press charges against. There are also coins that are never going to amount to anything, and if someone convinces you to buy one, that money is gone. There are scams out there. Before you do anything with your money, check around a bit and try find out if a lot of people think there's a scam involved. Sometimes it isn't entirely clear whether something is a scam or not, but in general you want to err on the side of caution. A good example of this is Bitconnect, a company that offers you easy money if you invest your crypto with them. It's not 100 percent clear that they are defrauding people, because all they are doing is offering really, really good interest rates and growing their user base, but their interest rates are so good that almost everyone in crypto is confident that sooner or later they will be unable to pay those interest rates, either because they run out of new customers with whose money to pay the interest for older customers, or because the crypto market will grow too slowly to sustain their growth no matter how large their customer base grows.
  3. No, seriously, don't invest money you can't afford to lose. We are in the wild west here, and a market down turn or a scam can end up costing you a good chunk or even all of the money you put in. By all means spread your money out between multiple coins on multiple exchanges/wallets, but even then, it is very possible that you will end up losing money. Crypto in general has been going up, up and up, but even so there are plenty of coins that have gone up, down, up, and then down down down. Oyster Pearl is a coin I thought looked really promising, and I still think it is, but in the last few weeks it's taken me from 60 cents per coin to four dollars and back down under 2. That's a net increase, but I assure you, it hurt when it fell by half. It hurt a lot. And some people bought in at $4 and lost half their investment in a few days.
That's the end of the guide. If you found this guide helpful, I would really appreciate if you used my referral links when signing up for exchanges. There is no downside for you in doing so, but the exchanges (pretty much all of them) give a small bonus if people sign up with your referral codes. So while I'm including my referral codes, the sites are the ones I use myself, and the ones I genuinely think are the best around. As I said above, I have not used Coinbase. If you wish to use Bitpanda for your initial coin purchase my link is here. For the main exchanges, my Binance link is here, and my Kucoin link is here. Alternatively you can find these sites on google. My Binance referral code is 11598073, and my Kucoin code is 1wHub. You can of course sign up for all these sites without using my referral codes, but if you found this guide helpful I would be grateful if you used them.
...Anyway. That is largely it. That's my guide for getting started in crypto. I can't stress enough that you'll want to take it slow. If $100 is a lot of money for you, start with $10, trade a little, get the hang of it. There's no substitute for personal experience. If you want to invest more, it's even more important that you take it slowly.
...Sorry for the long post, but I wanted to be thorough. Best of luck. Welcome to crypto trading!
I'm happy to answer questions. I'm by no means among the most knowledgeable about crypto on reddit, but I'm enthusiastic, and I should know enough to be able to answer most questions a complete beginner may have.
submitted by Rhamni to garlicoin [link] [comments]

CoinRelay: A scripting language to control cryptocurrency payment events.

Hey Bitcoin, I made something cool that you guys might think is useful:
I needed something like coinkite's auto-funds forwarding feature, that splits incoming payments into percentages, but their pricing model scared me away (and I like having control over my own coins).
I also realized that I wanted something a little more complex, something that I could fire and forget and generate hundreds of auto-relay addresses.
I also had other use cases that weren't covered by coinkite, like forwarding a constant amount of fiat to a coinbase autoconvert account, and other stuff.
I started to realize that a surprising number of bitcoin-related startups and services really just provide some simple behavior that responds to transactions on the blockchain. For example, satoshidice listens to the blockchain, runs some code, and reflects the profits back. I realized it would be cool to let ANYONE in the world make these kinds of services (like splitting or budgeting) for themselves easily.
What I wanted really was a /scriptable/ wallet. Wallets that would do whatever complex stuff I wanted, like custom budgets or taxes or donations to charity. Stuff like inheritances or escrow services.
And I didn't want to code those things in python or another would be too complex. Too many un-needed details. I started thinking about what kind of programming language I WOULD want to program my wallet in...
So a few days ago I decided to make it:) CoinRelay is a daemon and scripting language for coding up custom wallets that respond to incoming transactions.
Let me know what you think!
submitted by Steve132 to Bitcoin [link] [comments]

taxes on gifts or inheritance, help please!

Throwaway for reasons. We are in USA for taxes.
I have dabbled in crypto for about six months now, thanks to my uncle who was an early bitcoin adopter. He unfortunately passed last month and left his bitcoin, litecoin and eth wallets to my aunt. She knows nothing about the coins and since I was able to help her retrieve them, she wants to gift me a significant amount that I believe would throw red flags to the IRS.
My questions are: 1. What is the best course to move the bulk of the money to Coinbase for USD exchange, and how do we deal tax-wise since she is next of kin? As far as I know no taxes have been paid and the coins have been held since 2013. 2. For the gift to me, is this considered an inheritance? A gift? Would I pay long-term capital gains or would I now need to hold the coins for a year to prove that? There was nothing in the will about the coins.
Any advice is highly appreciated as I have been unable to find a lawyer knowledgable on the subject. Let me know if any other information is needed. Thank you very much!
submitted by Bagofhotdogs to CoinBase [link] [comments]

Bitcoin and Taxes

Just spent the last couple minutes playing around on Bitcoin Taxes, and i was kind of taken aback by the results.
I'm an independent contractor and recently I've started accepting payment in bitcoin. Every so often, exchanging bitcoin to USD to pay the rent, food, etc. Recently I started wondering about what kind of tax liability this might cause so I decided to investigate.
I imported my transaction history from Coinbase to Bitcoin Taxes, fed it all the necessary information. Since I was paid in bitcoin, it couldn't find a matching buy, so it assumed a "zero cost" buy. Surely that's an error? Wouldn't I inherit the same cost basis as the person that actually purchased the bitcoin?
Regardless, assuming it's not, if bitcoin ever goes "TO THE MOON" overnight i'd be getting taxed 28% on it the moment I need to convert it for rent, utilities, etc. That's on top of 15% Self Employment Tax + 25% Income Tax. Seems excessive no?
submitted by ElChinoNegro to Bitcoin [link] [comments]

Coinbase's KYC

I bought into btc on Coinbase earlier this year. I see they are steadily needing to comply with U.S. KYC laws.
My question is, now that I have the bitcoin on a wallet there, if I want to move it around and withdraw elsewhere, is there any place to do that without going through the KYC info? or would they need info to track that movement at any amount?
Also, does anyone know the pertinent laws as to why they inquire whether your money in bitcoin came from occupation, investment, inheritance, or mining? I suppose it's for tax purposes. What is the difference in accounting between the four?
submitted by COAT_REMOVAL_SERVICE to Bitcoin [link] [comments]

Bitcoin Futures Volume Hits All Time High! Is NOW the Time to BUY? BTC Target Price = $1,000,000?! Uploads from Altcoin Buzz - YouTube In-depth key supply and demand concepts and theory 06 December 2019 We Invested Over $100,000 In Gold Coins!!! - YouTube Craig Wright Bitcoins can crash the market

Where there’s death, there’s taxes, and crypto assets are no exception. In both the U.K. and the U.S., cryptocurrency is treated as property, which means inheritance tax is technically due on ... We are in USA for taxes. I have dabbled in crypto for about six months now, thanks to my uncle who was an early bitcoin... jump to content. my subreddits. edit subscriptions. popular-all-random-users AskReddit-news-funny-worldnews-todayilearned-pics-gifs-aww-Showerthoughts-gaming-tifu-movies-Jokes-mildlyinteresting-videos-television-Futurology-Music-TwoXChromosomes-explainlikeimfive ... Bitcoin Inheritance Planning The post Bitcoin Inheritance Planning appeared first on 99 Bitcoins. Español Русский It's said that in this world, only two things are certain: death and taxes. While Digital money that’s instant, private, and free from bank fees. Download our official wallet app and start using Bitcoin today. Read news, start mining, and buy BTC or BCH. Trying to set up an inheritance plan for cryptocurrencies in a legal way may result in negative consequences here, so you should rely only on those who you can trust, i.e. your friends and relatives. A step-by-step Bitcoin inheritance guide. Finally, we get to the topic of Bitcoin inheritance planning. Once you’ve found out the legitimate ...

[index] [34118] [48724] [3112] [34741] [29055] [19836] [31603] [17212] [12026] [6125]

Bitcoin Futures Volume Hits All Time High! Is NOW the Time to BUY? BTC Target Price = $1,000,000?!

Open a Coinbase Account to Buy Bitcoin or XRP Coinbase Link: NEW CHANNEL “The Digital Ledger” Please Hit The Like and Subscribe and Share on Social Media. #Bitcoin futures volume hits an all time high! Is now the time to buy? IBM VP of Blockchain & Digital Currencies $BTC target price $1 million, millennial lov... Brian Armstrong Live Speach: Coinbase Pro, Bitcoin News, BTC Price Stay Home Coinbase US 16,232 watching Live now BIGGEST BUY OPPORTUNITY IN 2020 FOR BITCOIN! Nothing that I write or discuss should be construed, or relied upon, as investment, financial, legal, regulatory, accounting, tax or similar advice. Nothing should be interpreted as a solicitation ... Hey folks, In this video I will have an in-depth look at key supply and demand concepts and theory. Today we will focus on finding key turning points in price. While supply and resistance go ...