On a long enough timeline there is bound to be

Zero Hedge Coin 0

Home / Bitcoin / The Bitcoin economy failure, taxation and accounting.

The Bitcoin economy failure, taxation and accounting.

The Bitcoin economy failure, taxation and accounting.

 

(ZHC0 will be an Altcoin. We will work to make it exchangeable for Bitcoin. Only by supporting Bitcoin can we ever hope to get an Altcoin like ZHC0 accepted as a real currency, and that is the experiment)

 

For Bitcoin to become part of the economy, and to become a currency for tax purposes, it needs greater adoption. It is no good receiving and holding Bitcoin, we need places to spend it as well. This means merchants. There are very few merchants who accept Bitcoin. So what is the single greatest reason merchants aren’t adopting Bitcoin?

 

Taxation.

 

To create an economy, I believe Bitcoin needs to be identified first in terms of taxation. The opposite is true, many are people are interested in Bitcoin first because it is anonymous and enables tax-free transactions. So there is a disconnection in terms of purposes. A failure.

 

Without merchants, there is no broader Bitcoin economy. Without clear taxation merchants get nervous, and dump Bitcoin in the ‘too hard basket’.

 

Merchants live with, eat and breathe tax. They are the primary tax collectors, be it through sales tax or by withholding income tax from their employees. They usually have no small amount of pride in being reliable and conscientious taxpayers.

 

Taxation isn’t easy. Merchants manage it through accounting software. Bitcoin complicates things. Most people would be running older account software, sometimes more than a year old, that might not incorporate recent changes to tax rulings to do with Bitcoin. Many people wouldn’t have software that identifies Bitcoin balances and transactions by name.

 

Ideally you want accounting software that manages and tracks your Bitcoin balances as if it was a currency, but handles its actual tax status according to your location.

 

In most places, Bitcoin is considered an asset that accrues capital gains and losses. It is NOT a currency, or money – which confuses people, especially as it is called a ‘digital currency’.

 

It is always best to go direct to the primary source of Bitcoin and tax information. In Australia, this is the Australian Taxation Office.

 

https://www.ato.gov.au/General/Gen/Tax-treatment-of-crypto-currencies-in-Australia—specifically-bitcoin/

 

To complement this, there is much international information on tax compliance on other websites, information that goes into far greater detail than I could. Investopedia and the Bitcoin.It Wiki are both good resources to start with.

 

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

 

http://www.investopedia.com/university/definitive-bitcoin-tax-guide-dont-let-irs-snow-you/

 

Perhaps someone can explain to me how Bitcoin, with a status of an asset subject to capital gains tax, can be treated as a currency within an accounting program without modifications to the program? This link to Bitcoin magazine sure confuses.

 

https://bitcoinmagazine.com/articles/using-bitcoin-with-quickbooks-part-1-recording-sales-and-accepting-payments-1385976677

 

To wrap up, how about a large, reputable company provide a service that lets you convert the Bitcoin to dollars immediately, meaning you never actually receive, hold or have to account for any Bitcoin? Now this I understand, and I believe, merchants will as well.

 

https://paybycoin.intuit.com

 

While change is slow Bitcoin is becoming legitimate.

One thought on “The Bitcoin economy failure, taxation and accounting.”
  1. Il Marketing agencies 2016-03-10 on 10:11 am Reply

    I enjoy to make money online. As soon as you get the cash rolling in Online marketing is very
    addicting. The difficult part is getting the money coming in. Here are 5 bottom
    lines to bear in mind so you can experience the happiness of making cash online.

    It is really hard to leave the security of a regular
    income and browse out something various. I took that giant leap of faith and I do not
    regret it at all. In reality, I wonder why I didn’t state,
    “Enough is adequate” a long period of time earlier.

    This is not to diminish the value of SEO experts in any method.
    They serve a valuable function and needs to never be
    neglected. Nevertheless, they have their restrictions as well and when you
    are wanting to succeed in web marketing you will certainly desire to work with the most
    vibrant and effective of innovations that are used to boost traffic.
    Again, this is where the Web2.0 innovation enters play.

    The marketing rule Comcast is breaking is this. Otherwise pleased clients who
    select to do absolutely nothing will lose channels. Clients must
    be able to choose out of the modifications and keep their existing
    service. At least for a transition period.
    Great quality ads that appear in many various genuine estate pamphlets and a representative that understands how to
    get the word out will certainly assist speed up the procedure.
    It’s likewise valuable to tell all of your pals, loved ones, and anybody who will listen that you
    have a fantastic piece of property for sale.

    Word of mouth is free and a helpful advertising strategy.

    They can even tell you that they are one of the
    most cost efficient custom-made brochure printing carrier when it comes to the
    cost. In addition, they have all the information that you have to know when you
    go to their internet marketing site. However
    lo and see! You finally realize that that is not exactly
    what you expect when you have your pamphlets printing in your hand.
    All the pledges that were offered you unexpectedly puff into smoke.
    In addition, your “expert” can only shrug his/her shoulder due to
    the fact that you currently paid him or her anyway.

    The other advantage of focusing on service and not sales, is that you are more in positioning with yourself.
    Due to the fact that you like assistance people and it’s distasteful to you when you turn individuals into dollar indicators, you
    most likely got into the real estate business.

    Advertise. This is where web marketing can be found in. Current information shows that marketing online produces more outcomes than the
    standard signboards or posters. Try to find web marketing ideas or totally free lessons
    on advertising, then strategize with your company partners.
    Web marketing is how you transmit to the world that your company is up and
    running. These methods include using social networking sites and social bookmarking to spread the word,
    tagging and commenting on other websites and online forums
    connected to your business, or connecting back to your website anywhere you go online.
    When you begin to market, trust that it will certainly spread like wildfire
    through the web. If you have the self-confidence and heart it takes to start an online company, you just might end up
    becoming an online multi-millionaire.

Leave a Reply

Your email address will not be published.

share social links if you dare

>> <<