Is steem income subject to taxes?

in taxes •  8 years ago 

I was curious if my steem income was subject to taxes. I would hate to earn all this $$$ and then find my self behind bars for failing to pay my taxes. I'm worried that my tax accountant is not going to even know what crypto currency is let alone how to legally report it on my taxes. There is the option of ignoring it and not reporting. The chances I get caught are pretty slim, but if I do get caught Yikes! Most likely will need to pay the taxes plus penalty, if i don't have the funds I might get a new orange outfit.

I'm too pretty to go to jail!

We are in a bit of the grey area of the law but when we talk about substantial sums that most likely are subject to taxes, I feel like the discussion is long over due. I'm sure numerous community members have not prepared for this eventuality and now is the time to consider what you are going to do.

I found this site with a bit of information https://en.bitcoin.it/wiki/Tax_compliance . Put aside your views on government and taxes and offer some sound legal advice if you have any.

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  ·  8 years ago (edited)

Knowing how governments works they would tax breathing and farting if they could. So the answer is absolutely. But only when you sell them for fiats in most cases.

It might be, in Canada Bitcoin is considered a commodity like oil or wheat. If you sell and make a profit you must pay capital gains. However, you can also right of anything that helped you make that gain. For example, with Bitcoin, you can write off miners or equipment, fees etc.

Note: I am not a tax professional

Crypto itself is not taxable (much like stocks). But, if you convert that crypto into FIAT currency, then it is subject to capital gains tax.

https://en.bitcoin.it/wiki/Tax_compliance

If you earn steem, then you'll be subject to income tax. If you bought steem then sold it for more, you'll be subject to capital gains tax. There is no magic behind it.

So is it taxed on the value when I earned it, the value at tax time, or the value if I trade it for fiat? Some other arbitrary point.

On the value when it was earned. So you'll need the ability to do a historical lookup and find the average price or the closing price on the day that earned it.

Define earned first?

Is that the moment when the curation/author rewards get accredited to your account?
Or the moment you claim your tokens?

Where did you get this information? I'd like to know.

Did you ever get more clarification on this? I am new, been on for one month and trying to understand what i need to do to be obeying the law in the us. I have Not converted anything to USD or bitcoin from my Steem rewards, but i have earned both sbd and Steem power. Any help?