Based on the internet research I've done, the answer is yes, you have to pay income tax on the dollar value of your Steemit income at the time it was paid out. The fact that it was paid in a cryptocurrency that's lost over 90% of it's value is irrelevant.
You never have to pay taxes. This is one of the biggest reasons people use cryptocurrencies. They allow for easier avoidance of extortion by the state.
Buy it here: https://steemit.com/shirts/@bitcoinshirtz/brand-new-just-say-no-to-taxes-tee
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Actually no, if your money is purely in cryptocurrency for most countries even in the U.S you do not have to pay taxes. It is only when you sell your cryptocurrency and get that income in the respective countries' local currency like USD or GBP you owe taxes.
So in short, you only have to worry about taxes if you decide to cash out, on an extra note, how the fucking hell did you get $2,000 posts? Lucky bastard :P
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From what I've read, if you earn income i.e. payment in exchange for services in Bitcoin, that is subject to income tax. The IRS would treat Steem the same as Bitcoin given they're both cryptocurrencies. Now if you purchased Steem then it wouldn't be taxable until you sold it for fiat.
Source: https://en.bitcoin.it/wiki/Tax_compliance
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Yes but the point is you'd have to sell it in dollars first for it to be treated as genuine income, the IRS has declared Bitcoin a commodity rather than a currency so it would be like selling any other commodity or stocks.
That's how most countries in the west at least treat Bitcoin.
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According, to @lpfaust, a professional tax preparer, you're wrong and I'm right. Steem rewards are taxed at the dollar value of the time they were paid out: https://steemit.com/steem/@knircky/steemit-taxes-help#@lpfaust/re-knircky-steemit-taxes-help-20161230t033249858z
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This is assuming you're in the US.
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Oh wait, that's for steem itself? I was thinking that steem wasn't even recognised by law yet, I was thinking of in terms of receiving steem and then selling to Bitcoin.
I'll need to read up on that if the rules for steem itself are different, thanks for letting me know, I'm in the UK, so it probably isn't an issue yet and the Bitcoin rules apply but I wasn't aware of this.
This bit is exactly what I was referring to in regards to Bitcoin, I would have thought that Steem wouldn't even be recognised by governments yet by a currency because of the low trade volume because that's how it worked with Bitcoin. The banks and the government only started caring when the money started flowing.
I think the IRS might have changed the rules slightly since last I checked, in the UK you don't owe any taxes until you turn it into GBP.
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Since Steemit doesn't issue 1099's to individuals, it's highly unlikely the IRS will be looking to collect taxes on non-USD payments to you. The likelier scenario is that you sell your Steemit for USD at some point down the line and must take either a short term or long term election on the gain in value. The IRS cares about the resulting FIAT for the most part. This is true with stocks as well. You can invest in the stock market for 100 years without selling your stock and never have a taxable event (excepting dividends paid in cash). It's only when you go to sell the stock that your tax burdens kick in.
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you dont have to pay any taxes, especially if your not cashing out!
if u are keeping ur money in stempoer, are you seriously thinking the government is going to force you to power down and then sel your steem for bitcon and then sel the bitcoin for dollars an then pay them with those dollars? what if u cant exchange it? what if u get a bad deal at an exchange? they cant ask u to power down ...tahts rediculous, also they wont know
DO NOT report any steemit earnings THAT is illegal
steemit s NOT real money KEEP IT ALl its YOUR STEEM do NOT PAY A DIME to ANYONE
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