Why are so many cryptocurrency investors so worried? Ted Bauman explains that it has to do with the IRS. First, a little background is in order. The fact is that many people became rich when the cryptocurrency industry saw a huge spike at the end of last year. The price of Bitcoin went up by around a thousand percent, and a lot of people made huge profits. What did they do with those profits? In many cases, they used the money to invest in other cryptocurrencies. However, the problem is that after they invested their money into other cryptocurrencies, the market crashed and the prices of those currencies started going down. Visit stocktwits.com to learn more.
Ted Bauman says that the IRS is not allowing any excuses and is not cutting struggling investors any slack. They are demanding taxes from the profits that the inventors made during the first spike, while not accounting for their loss of money during the market crash that happened right after that.
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The fact is, says Ted Bauman, that the IRS calls cryptocurrencies assets. They do not consider them currencies. Thus, any gains that are made from the sale or the purchase of such cryptocurrencies are going to be subject to tax. Ted Bauman interviewed Ian King about this, and he clarified that this is indeed the case.
Let us say that a person made a few hundred thousand dollars by selling his cryptocurrencies when they were at the highest point. According to the IRS, he now owes them thousands of dollars in taxes. That will not change just because the person reinvested the money into other cryptocurrencies and then lost all of that money when the market crashed. The IRS does not care what you invested it in after you sold it. They just care about whether or not you pay taxes.
The truth is that many people made thousands of small purchases or sales of cryptocurrencies and simply do not know exactly how much profit they made. Many people are upset about the IRS doing this, as they wanted Bitcoin to be something that the government had no say in. Read more: http://sovereignsociety.com/bauman-letter-reports/