Bitcoin News Sunday, March 18 Ira, Retirement savings, Hefty tax bills & more…
Bitcoin News TLDR / Table of Contents
- Putting bitcoin in your IRA can sink your retirement
- More companies are offering cryptocurrency friendly IRAs. Here’s what you need to know.
- IRA, retirement savings, bitcoin ira, California-based Bitcoin IRA, traditional IRA accounts
- Investors in Bitcoin and other cryptocurrencies face hefty tax bills
- According to the Internal Revenue Service, anything purchased using a digital currency is liable to be taxed as a capital gain
- hefty tax bills, , , ,
- The bitcoin bubble
- PUT the word Bitcoin into Google and you get (in Britain, at least) four adverts at the top of the list: “Trade Bitcoin with no fees”, “Fastest Way to Buy Bitcoin”, “Where to Buy Bitcoins” and “Looking to Invest in Bitcoins”.
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- Last year, she invested 15 percent of her retirement savings in cryptocurrencies.
- Six percent of savers say they would consider using cryptocurrencies as an investment option for their retirement plan, according to a recent survey by Auctus, a platform for retirement planning.
- Chris Kline, chief operating officer at California-based Bitcoin IRA, said about 4,500 people have signed up for its retirement accounts since it opened in 2016.
- Douglas Boneparth, president and founder of Bone Fide Wealth, said he worries the talk about bitcoin IRAs will make people overestimate how normal it is to invest in cryptocurrencies.
- For most people who have an IRA, they’re in no position to be investing this way.
- Wild fluctuations in the value of digital currencies bitcoin surged from less than one dollar in 2010 to $997 at the start of the 2017 to nearly $20,000 before settling back to around $8,500 on Friday have exposed investors to tax bills the value of their coins may no longer…
- One complication for crypto investors is that digital currencies that were, in part, devised to operate outside of government and banking industry oversight, are still of interest to the US tax authorities, who look at cryptocurrency as property and not currency.
- Another source of confusion is that crypto-brokers are not required to issue 1099 disclosure forms the forms used by the IRS to report income other than wages, bonuses and tips on digital currencies, but individuals are still responsible for reporting gains.
- IRS wanted information so they could enforce tax law on individuals.
- So on one side, yeah, its been easy to avoid tax, but on the other its part of the crypto ethos of personal responsibility to own up to it, Perez says.
- More people will trade in Bitcoin and that means more demand, and thus the price should go up.
- The last factor makes Bitcoin appealing to criminals (although this is even more true of cash) creating this ingenious valuation method for the currency of around $570.
- A much more plausible reason for the demand for Bitcoin is that the price is going up rapidly (see chart).
- People are buying Bitcoin because they expect other people to buy it from them at a higher price; the definition of the greater fool theory.
- If everyone tried to realise their Bitcoin wealth for millions, the market would dry up and the price would crash; that is what happened with the Mississippi and the contemporaneous South Sea bubbles.
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