You are viewing a single comment's thread from:
RE: Why Choosing the 50/50 Author Payout Is a Good Thing
Thank you for posting this @kenmelendez.. I didn't realize this.
I recently switched to Powering Up 100% of my rewards but I think I'll switch back now. I was concerned that buying Steem with SBD's is a 'taxable event' in the United States and that I'd get a headache trying to report all of my trades to the IRS.
@beunconstrained wrote about this on his @kod3g3ar account:
Let me chime in with some more information. A few weeks back, my accountant & I completed the 2017 tax returns (yeh, late extensions... I know...) but in the process the conversation covered a lot of crypto transactions that were reported. We spoke about mining, specifically. This is not advice to you. You should seek counsel with your own tax professional. I'll just let you know what was told to me.
My accountant was sensitive to two things - the fact that as of the January 1st 2018 date, following the implementation of the recent Tax Reform bill into law, there is a small variation in regards to the taxable status of "like kind" transactions. In the past, these were vague and most people in the crypto community would understand that moving crypto to crypto (ie. BTC to ETH or LTC to XRP or BTC to STEEM, etc.) were not taxable events. That is they didn't trigger the reporting of taxable gain or loss at the time the transaction was done. This pretty much is uniformly understood that now these transactions are taxable events, as the exclusion under law was narrowed to be specific to real estate (ie. 1031) exchanges.
Additionally my accountant was very specific with me in regards to mining. When income is realized at the time of mining it is, in his opinion, a taxable event. This would mean that as revenue is recognized in STEEM, it creates a taxable event. The question really would come down to how to establish the value of that. Since Steem revenue is seen in micro-sized curation rewards, etc. it would be reasonable to assume that each reward needs to be documented, and the price of Steem at the time of the reward would be the basis of determining taxable gains or losses. Clearly this is a documentation nightmare. However that doesn't matter to the IRS. You document the transactions and report them according to law. No exceptions.
So it may have impact BOTH to the recognition of gains/losses at the time of receiving mining rewards, but also at the time of "like kind" transactions. Although there are few precedents here that have been tested, it is my accountants reading that both would apply here and reporting should cover both mining (ie. curation, etc. rewards) and also "Power UPs" or "like kind" transactions as both may create a taxable event that must be reported.
Note that all of this information is publicly available via the Steem blockchain. That means that IRS have access to the same transaction logs that we all do, so transparency would be the key (IMHO) in reporting here.
You may not like to hear this information, but don't shoot the messenger. I'm just passing on what I was told. YMMV.
I am not sure how they would monetize the app but there is a desparate need for an app that will help U.S. Steemians report their Steem-based transactions to the IRS @beunconstrained.
Hopefully one of the developers like @blockbrothers @exyle can make an app for this. I would be willing to pay a modest fee for this and I think many others would too.
Calculatimg Steem-based transactions manually so that they can be reported to the IRS will be a nightmare!!!
My accountant and I reviewed a number of potential solutions. This appears to be the best to date:
https://www.cointracker.io/
Now the key is for us to lobby them to support Steem. But if the Steem community only represents a minute portion of crypto transactions, they won't invest the $ in labor to support it. Also the fact that it doesn't feature on the exchanges that they support will be a deterrent. I am inclined to suggest that the value of Steem is going to be limited until there is some more mainstream adoption here, and it supports a position that Bitcoin would have been a wiser investment strategy than Steem given the current position of the coin in regards to external support. That said, if we can lobby to increase visibility, then the benefits follow. But the best thing that the Steem community can do is to create content that is high quality and not available elsewhere (ie. no more cross posting D-Tube videos to YouTube), and that Steemit posts are of a quality of journalism rather than a picture of the food you are about to eat. Twitter would never have gotten as popular and the defacto place for short statements on the Internet if it remained as it was in 2009. Its evolution represents the fact it is now an important place on the Internet. We have to do the same here.