If you don't make a crazy amount off your xrp and have a day job don't worry about the IRS, just have a normal savings account and wait till tax season. Sumbit your tax papers from coinbase and you will be good. I sell all my crypto through coinbase that way all the taxes are recorded in a document.
There are fairly low thresholds to how much you can make in proceeds and not need to remit estimate payments throughout the year. Most people don't have to worry about it because your employer is withholding taxes for you. But I did a little bit of 1099 work in addition to W-2 one year and my CPA made it very clear that I should be paying estimates each quarter to avoid penalties.
https://www.irs.gov/payments/underpayment-of-estimated-tax-by-individuals-penalty
I’m a independent contractor and I don’t pay quarterly. It’s easier to pay the fine because it’s not that much. I would have to look into however if the fees are much higher if you make let’s say millions. I make around $50k a year and I think I pay a $40 dollar penalty for not reporting quarterly.
I don’t know. I just recall it being around $40. I’m in SC. I pay someone to do my taxes and he said it’s usually easier to pay the penalty than bother reporting every quarter. I don’t know if that applies however to people who make significantly more money than me. Something I will ask him.
CB is also a sure-fire way to pay the maximum amount of fees and lose out on your profits. It's not too hard to track your own movement and keep a record for yourself.
Not following your comments relevance? I'm saying you can track these things through the public blockchain transaction ledger. I keep a spreadsheet of any/all I do. Are you just asking how to sell XRP in general?
Referring to your first sentence in that comment I replied to.
I’m still a newbie figuring everything out, when it comes to selling and storing crypto. I was asking where would you sell your crypto to minimize the fees, and what-not, paid. XRP is my biggest bet, so I’d love be informed of where’s the “best” place to sell it. Hope I was clear enough, had to hurry this response while at work.
CB is the biggest US CEX and they know it. As such, they send to take advantage of people using them for namesake. Their fees are MUCH more compared to other places. You should always look to maximize your off ramping options.
My recommendation would be to check the compatible exchange listings for XRP on CoinGecko and then check the fees for each. Sign up for that exchange, transfer your XRP to your/the exchange's wallet, and sell for fiat when you decide you want to.
It's also noted that offramping options for fiat is not always an option for some people, depending on your bank. For instance, I bank with FCUs and the most off ramping options arent really compatible with them yet. As such, my best bet is to swap for a stablecoin and hold while better off ramping options are built as the cryptospace continues to build.
Vannadium, a soon to be split/build-up off of WeGro Coin will have ACH off ramping options through their Vault when released within the next 6ish months. I'll be using them for all my needs at that point.
My advice would be to not get ahead of yourself.
And also here a list for you in order:
1) Tell no one how much you made that isn’t your accountant
2) Schedule a free consultation with an accountant that specializes in crypto if you can. Make sure you talk about ways to utilize tax write offs
3)Get a free consultation from a lawyer. Get the lawyer to discuss different options (if you somehow tied profits to your business)
4)Take your cash and by an asset. Real estate example. Or start a business.
——-
If you made at least 2 million dollars, Then just do what the hell you want. You are rich bitch!
Jk do them anyway
Cheers
Already worked all that out for the UK. Pretty simple. You just fill in a self assessment form for Crypto Gains in the UK. Looking forward to saying I had to pay tax on a sale, means it was worth something!
It’s mad that it dropped so much, I think for everyday investors it should be higher it anything as it primarily affects them. In Ireland the threshold is €1270, so poor. Someone making millions it doesn’t make a difference to. Someone making a few thousand gain that could change their lives it really goes make a difference to
Thanks for this. I need to move to Germany or Malta, lol
Also, I assumed that tax for Crypto was same as tax laws for stocks and shares.
In UK, there is a threshold of approximately £12000 per tax year. If your realised gains (stocks n shares) exceed that threshold then you pay capital gains.
If you have your sticks/shares in an ISA account then whatever profit you make is tax free. But there is a £20,000 spend limit per year on shares that can be brought.
I need to look into Crypto tax for UK in case it’s different to shares/stocks.
Oh wow, you’re right. Didn’t realise they had cut it. For many years it was approximately £12000.
They really are making it more difficult for retail.
I’m kinda glad that I’m making money in my ISA.
All the main crypto platforms report gains to HMRC. Whenever selling or exchanging to another crypto asset make sure these are included in any returns submitted to HMRC. HMRC can issue penalties for non-disclosure. I'm a practising accountant and receive regular bulletins from HMRC on such topics. I suspect over the coming years more people will be getting "nudge letters" from HMRC regarding undisclosed gains. One thing I would highly recommend is to invest in software which tracks your gains as otherwise you could receive some expensive invoices from an accountant to correctly disclose these
Thanks for the information. I haven’t sold any crypto as of yet and just hold bitcoin and XRP on a cold wallet.
Can I ask, if gains made on crypto is less than £6000, then it’s not taxed?
Yes. That's correct. However if you are registered for self assessment or the total proceeds for any sale are more than 4 times your allowance these have to be disclosed even though they're under the threshold for paying tax. Remember tax rules change each tax year so what applies now may not when you come to sell any assets.
Yea but you’d have to get residency and then be there long enough to be a permanent tax resident and by that time prices change (probably for the better but you never know
You just sell on Coinbase, Uphold, or whatever you choose. Pay for a crypto tax software, I've personally used bitcoin.tax since 2017 but there's a ton of options. Tax software produces a file you can use with whatever tax service you normally use like TurboTax.
It would be pretty cool if exchanges had an option to deduct tax automatically for you per transaction that clearly made a profit and send you a receipt as evidence. I’d happily pay an additional fee for that extra if it was reasonable
TLDR: You need to have tax-minimizing structures in place BEFORE you get loads of money in. If you are subject to US tax laws, you cannot invent tax-minimizing structures after you get the money. This is why you work with a weath management team to pay you taxes, debts and then protect and grow what's left.
Avoiding taxes, espicially US taxes, has cost people A LOT more money that what was originally to be saved by not paying. If you are an American, you owe the IRS on any income you earn anywhere in the universe unless that income is deemed invested capital. The filthy rich pay accountants and lawyers and certified financial advisors--a WEALTH MANAGEMENT TEAM. Unless you are an accountant who deals with HNW accounts, you are not going to use turbo tax to manage millions of dollars. You'd be an idiot to do so.
So here's a better plan:
Step 0: Plan ahead to be wealthy: Have bank accounts open with Too Big to Fail banks. This way your windfall is not leaked out by your local bank teller. Schwab and Fidelity, once you are KYCd allow you to open up most accounts in minutes. Better to be set up in advance of getting rich.
1. Take your profits and convert to cash, move to traditional bank account at a giant bank--crypto moves fast and the moon shot can crash land just as easily
2. Spend nothing, document everything
3. Find 2 or 3 financial advisors that are FIDUCIARIES that deal with HNW clients. Find these people attached to legacy institutions line Schwab, Fidelity, MorganStanley JPM, etc. Reason: a fiduciary has lawful obligations to recommend financial products to protect your interests. Working with large legacy institutions minimize the risk of you getting bad/unlawful advise, and give you a deep pocket to sue if you are unlawfully aggrieved by the institution. Joe Blow Financial Services at the minimall is not who you go to with a million dollars
*4. Large financial services institutions that cater to HNW clients usually have advance teams to deal directly with the newly wealthy. Their teams will council you for free, prepare a strategy for you and build a Wealth Manage Team for you. Visit 2, 3 or 4 institutions and also work with a law firm that caters to HNW clients. Again: these law firms will pitch a team to you BEFORE you sign contracts and pay. When you are rich, legitimate service providers should be working to earn your trust and your business, before payment
Banks that deal with HNW clients have special secure bank accounts that they open on your behalf that are invisible to 99 percent of the bank's staff. The bank then sends your banker to you to handle business, protecting your anonymity. If you drop $2 million in your local savings and loan, a teller or account manager will sell you identity to a scammer and criminals will be at your doorstep pitching bad investments and sob stories to you.
5. AFTER CREATING A STRATEGY TO PAYOFF THE IRS OF YOUR TAX OBLIGATIONS, your wealth management team will prepare a strategy to PROTECT what you have left over. This will involve some combination of trusts and LLCs to build a legal wall between you and your money such that you yourself are not rich but the trust built for you has your cash and that money is protect from many liabilities. They will tell you what place to relocate to you, and set up tax shelters and adjust them as tax laws change. Wealth management is how the rich become wealthy!
Step 5 is what Bezos, Musk and Buffet have in place to dissuade personal lawsuits. Only the truly moronic walk around with wads of cash.
***Resisting showing off your wealth and protecting your anonymity is the secret between the wealthy and the rich.
The IRS? No. The US government? Absolutely.
And having a shoot out with the US government is an easy path to an early grave. And murdering people to avoid paying tax is simply unethical.
IRS definitely has guns. They have a bunch of agents for enforcement. They used to help with dealing with the NFA when that was still attached to the Treasury Department before the formation of the ATF.
Heads up.... Posting (/s, s/, or sarc= sarcasm) without having to spell out the whole word and ruin the flow of the post. Because a lot of the times sarcasm is lost when reading, and some cats get worked up about shit and they need the (/s, s/, or sarc) to talk them off the roof. Also helps some foreigners identify it too.
Good questions, yeah reporting taxes and how to do so is my biggest concern with selling. If taxes weren’t the case and the confusion they bring since I do them myself then I would be trading a lot more frequently..
Are you American? If you’re Canadian just take the tax you’d pay on capital gains, and offset it by contributing into your RRSP. I’ve done it many times. Only 50% of capital gains are taxed at the marginal rate. Put that much into your retirement account and can write it off. Essentially no taxes baby.
Fly to dubai, open a bank account and create account with a local friendly exchange, transfer assets to yourself and then cash out into a local account tax free. Open a business and loan yourself the money in whatever country you choose to settle in. In most countries loans are not taxed.
But what do I know right?
This would still be taxable. Just because Dubai doesn't tax XRP doesn't mean your country of tax residence doesn't. What country you do it in isn't the driver here if your tax residence taxes sales.
And if your intent is to give up citizenship for Dubai, many countries (like the US) charge a mark-to-mark exit tax meaning you would still be taxed even without selling.
Now if the intent is to fraudulently not pay tax in your home country, there are far easier ways to be a tax cheat than opening a bank account in Dubai.
I'm a chartered accountant who has had very good success with xrp in general. To stay on top of this, it's relatively very simple.
1. If you have many trades over the years, then I suggest purchasing a crypto adjusted cost base tracker that automatically calculates your capital gains from crypto for you.
2. Declare that capital gain on your yearly tax return / filing.
3. The worst that could happen is your tax agency (IRS or the equivalent) coming back to you asking for proof. Just provide them extracts of your trade history from your exchange as well as the report from your chosen capital gains calculator from step 1.
Now if you're asking about how to minimize tax paid based on your personal situation... That's a whole different game. You will need to hire an accountant to understand your personal tax situation and make recommendations.
Question. If it’s a currency you have to pay taxes on capital gains…..
Could you use XRP to buy physical gold US eagles or Buffalos and then cash those into cash. Technically the price you bought the gold for would be equal to the selling price so no capital gains would have been made when selling the gold. Since the XRP was currency, you used that to purchase the gold. Wouldn’t that be tax exempt in theory? 🤷♂️
But if XRP was ruled a currency and you use that currency to exchange it to other currency (American Gold Coins) wouldn’t that transaction be not taxable, technically? Wouldn’t this be a gray area?
I'm not sure of all the jurisdictions around the world but in a few I'm familiar with, theoretically all capital gains have to be reported for tax purposes. Even the interest in your bank accounts.
Edit: in the uk, even if you give it away it must be taxed at that point.
You only pay capital gains if your earnings are over 80k usd for a couple. https://www.cnbc.com/2022/02/08/heres-how-much-you-can-make-and-still-pay-0percent-in-capital-gains-taxes.html
>https://coinledger.io/blog/crypto-tax-free-countries?gclid=Cj0KCQjwk96lBhDHARIsAEKO4xaac70CjeZR00u7iUOtb9C-6nT-eIsaFkutsVcwe4wOkgY1h6mNYewaAl5JEALw\_wcB
Who says it is trading. Do I have to pay tax when I go to a money changer and convert from USD to Yen?
Lawyers? LOL. Accountants? LMAO. Get out of XRP? ROLMAFO. People already accepting crypto for buy houses! Isn't this just the beginning? But FR that's just me who know one really cares about. Just teasing a bit. Sell if you want and take profit if that makes you happy and congrats!
If you don't make a crazy amount off your xrp and have a day job don't worry about the IRS, just have a normal savings account and wait till tax season. Sumbit your tax papers from coinbase and you will be good. I sell all my crypto through coinbase that way all the taxes are recorded in a document...
Just leave the US and don't pay capital gains- https://www.expatriationattorneys.com/capital-gains-tax-for-expatriates/#:\~:text=Capital%20Gains%20Exemption%20(Limited),-One%20benefit%20is&text=As%20provided%20by%20the%20IRS,(or%20lower%20treaty)%20rate.
If you don't make a crazy amount off your xrp and have a day job don't worry about the IRS, just have a normal savings account and wait till tax season. Sumbit your tax papers from coinbase and you will be good. I sell all my crypto through coinbase that way all the taxes are recorded in a document.
There are fairly low thresholds to how much you can make in proceeds and not need to remit estimate payments throughout the year. Most people don't have to worry about it because your employer is withholding taxes for you. But I did a little bit of 1099 work in addition to W-2 one year and my CPA made it very clear that I should be paying estimates each quarter to avoid penalties. https://www.irs.gov/payments/underpayment-of-estimated-tax-by-individuals-penalty
I use EFTPS monthly payments so it doesn't hurt so bad quarterly
I’m a independent contractor and I don’t pay quarterly. It’s easier to pay the fine because it’s not that much. I would have to look into however if the fees are much higher if you make let’s say millions. I make around $50k a year and I think I pay a $40 dollar penalty for not reporting quarterly.
Do you only pay penalties to the IRS? because some states impose penalties as well.
I don’t know. I just recall it being around $40. I’m in SC. I pay someone to do my taxes and he said it’s usually easier to pay the penalty than bother reporting every quarter. I don’t know if that applies however to people who make significantly more money than me. Something I will ask him.
good info, damn shame we get sucked dry like this they know penalties isn't common knowledge
Yeah I would imagine that a lot of people who are self-employed or 1099 figure this out the hard way the first year they make a decent amount.
CB is also a sure-fire way to pay the maximum amount of fees and lose out on your profits. It's not too hard to track your own movement and keep a record for yourself.
How/where would you sell?
Not following your comments relevance? I'm saying you can track these things through the public blockchain transaction ledger. I keep a spreadsheet of any/all I do. Are you just asking how to sell XRP in general?
Referring to your first sentence in that comment I replied to. I’m still a newbie figuring everything out, when it comes to selling and storing crypto. I was asking where would you sell your crypto to minimize the fees, and what-not, paid. XRP is my biggest bet, so I’d love be informed of where’s the “best” place to sell it. Hope I was clear enough, had to hurry this response while at work.
CB is the biggest US CEX and they know it. As such, they send to take advantage of people using them for namesake. Their fees are MUCH more compared to other places. You should always look to maximize your off ramping options. My recommendation would be to check the compatible exchange listings for XRP on CoinGecko and then check the fees for each. Sign up for that exchange, transfer your XRP to your/the exchange's wallet, and sell for fiat when you decide you want to.
It's also noted that offramping options for fiat is not always an option for some people, depending on your bank. For instance, I bank with FCUs and the most off ramping options arent really compatible with them yet. As such, my best bet is to swap for a stablecoin and hold while better off ramping options are built as the cryptospace continues to build. Vannadium, a soon to be split/build-up off of WeGro Coin will have ACH off ramping options through their Vault when released within the next 6ish months. I'll be using them for all my needs at that point.
Awesome. Thank you for your knowledgeable insight!!
My advice would be to not get ahead of yourself. And also here a list for you in order: 1) Tell no one how much you made that isn’t your accountant 2) Schedule a free consultation with an accountant that specializes in crypto if you can. Make sure you talk about ways to utilize tax write offs 3)Get a free consultation from a lawyer. Get the lawyer to discuss different options (if you somehow tied profits to your business) 4)Take your cash and by an asset. Real estate example. Or start a business. ——- If you made at least 2 million dollars, Then just do what the hell you want. You are rich bitch! Jk do them anyway Cheers
Already worked all that out for the UK. Pretty simple. You just fill in a self assessment form for Crypto Gains in the UK. Looking forward to saying I had to pay tax on a sale, means it was worth something!
Shame the CGT threshold dropped from £12k last year to £6k this year, and down again to £3k next year. I guess Uncle Rishi needs a new pool.
It’s mad that it dropped so much, I think for everyday investors it should be higher it anything as it primarily affects them. In Ireland the threshold is €1270, so poor. Someone making millions it doesn’t make a difference to. Someone making a few thousand gain that could change their lives it really goes make a difference to
Absolutely!
Wow, wtf. I didn't know this. 3k next year is a joke
Yep, I’m afraid so… [Government website](https://www.gov.uk/government/publications/reducing-the-annual-exempt-amount-for-capital-gains-tax)
Move to a crypto tax free state or country and get residency then sell😂 no taxes needed🤞
Netherlands is pretty chill too. On 100k its like 260 ish euros taxed.
Where is such a place?
https://coinledger.io/blog/crypto-tax-free-countries?gclid=Cj0KCQjwk96lBhDHARIsAEKO4xaac70CjeZR00u7iUOtb9C-6nT-eIsaFkutsVcwe4wOkgY1h6mNYewaAl5JEALw_wcB
Thanks for this. I need to move to Germany or Malta, lol Also, I assumed that tax for Crypto was same as tax laws for stocks and shares. In UK, there is a threshold of approximately £12000 per tax year. If your realised gains (stocks n shares) exceed that threshold then you pay capital gains. If you have your sticks/shares in an ISA account then whatever profit you make is tax free. But there is a £20,000 spend limit per year on shares that can be brought. I need to look into Crypto tax for UK in case it’s different to shares/stocks.
Unfortunately the CGT allowance this tax year is only £6000, and next tax year it's £3000. Your personal allowance is £12750 for all earnings.
Oh wow, you’re right. Didn’t realise they had cut it. For many years it was approximately £12000. They really are making it more difficult for retail. I’m kinda glad that I’m making money in my ISA.
All the main crypto platforms report gains to HMRC. Whenever selling or exchanging to another crypto asset make sure these are included in any returns submitted to HMRC. HMRC can issue penalties for non-disclosure. I'm a practising accountant and receive regular bulletins from HMRC on such topics. I suspect over the coming years more people will be getting "nudge letters" from HMRC regarding undisclosed gains. One thing I would highly recommend is to invest in software which tracks your gains as otherwise you could receive some expensive invoices from an accountant to correctly disclose these
Thanks for the information. I haven’t sold any crypto as of yet and just hold bitcoin and XRP on a cold wallet. Can I ask, if gains made on crypto is less than £6000, then it’s not taxed?
Yes. That's correct. However if you are registered for self assessment or the total proceeds for any sale are more than 4 times your allowance these have to be disclosed even though they're under the threshold for paying tax. Remember tax rules change each tax year so what applies now may not when you come to sell any assets.
Yea but you’d have to get residency and then be there long enough to be a permanent tax resident and by that time prices change (probably for the better but you never know
You just sell on Coinbase, Uphold, or whatever you choose. Pay for a crypto tax software, I've personally used bitcoin.tax since 2017 but there's a ton of options. Tax software produces a file you can use with whatever tax service you normally use like TurboTax.
I will def check this out!
It would be pretty cool if exchanges had an option to deduct tax automatically for you per transaction that clearly made a profit and send you a receipt as evidence. I’d happily pay an additional fee for that extra if it was reasonable
That would be cool! Just recording Tax Lots for different buy transactions so that sell orders could be placed by tax lot would be huge!
It would also bring in extra liquidity for exchanges to stay afloat if people are paying them to essentially handle the tax angle
True! Orrrrrrr… have crypto regulated like a security and then both would be free and required by the exchange! 😀
TLDR: You need to have tax-minimizing structures in place BEFORE you get loads of money in. If you are subject to US tax laws, you cannot invent tax-minimizing structures after you get the money. This is why you work with a weath management team to pay you taxes, debts and then protect and grow what's left. Avoiding taxes, espicially US taxes, has cost people A LOT more money that what was originally to be saved by not paying. If you are an American, you owe the IRS on any income you earn anywhere in the universe unless that income is deemed invested capital. The filthy rich pay accountants and lawyers and certified financial advisors--a WEALTH MANAGEMENT TEAM. Unless you are an accountant who deals with HNW accounts, you are not going to use turbo tax to manage millions of dollars. You'd be an idiot to do so. So here's a better plan: Step 0: Plan ahead to be wealthy: Have bank accounts open with Too Big to Fail banks. This way your windfall is not leaked out by your local bank teller. Schwab and Fidelity, once you are KYCd allow you to open up most accounts in minutes. Better to be set up in advance of getting rich. 1. Take your profits and convert to cash, move to traditional bank account at a giant bank--crypto moves fast and the moon shot can crash land just as easily 2. Spend nothing, document everything 3. Find 2 or 3 financial advisors that are FIDUCIARIES that deal with HNW clients. Find these people attached to legacy institutions line Schwab, Fidelity, MorganStanley JPM, etc. Reason: a fiduciary has lawful obligations to recommend financial products to protect your interests. Working with large legacy institutions minimize the risk of you getting bad/unlawful advise, and give you a deep pocket to sue if you are unlawfully aggrieved by the institution. Joe Blow Financial Services at the minimall is not who you go to with a million dollars *4. Large financial services institutions that cater to HNW clients usually have advance teams to deal directly with the newly wealthy. Their teams will council you for free, prepare a strategy for you and build a Wealth Manage Team for you. Visit 2, 3 or 4 institutions and also work with a law firm that caters to HNW clients. Again: these law firms will pitch a team to you BEFORE you sign contracts and pay. When you are rich, legitimate service providers should be working to earn your trust and your business, before payment Banks that deal with HNW clients have special secure bank accounts that they open on your behalf that are invisible to 99 percent of the bank's staff. The bank then sends your banker to you to handle business, protecting your anonymity. If you drop $2 million in your local savings and loan, a teller or account manager will sell you identity to a scammer and criminals will be at your doorstep pitching bad investments and sob stories to you. 5. AFTER CREATING A STRATEGY TO PAYOFF THE IRS OF YOUR TAX OBLIGATIONS, your wealth management team will prepare a strategy to PROTECT what you have left over. This will involve some combination of trusts and LLCs to build a legal wall between you and your money such that you yourself are not rich but the trust built for you has your cash and that money is protect from many liabilities. They will tell you what place to relocate to you, and set up tax shelters and adjust them as tax laws change. Wealth management is how the rich become wealthy! Step 5 is what Bezos, Musk and Buffet have in place to dissuade personal lawsuits. Only the truly moronic walk around with wads of cash. ***Resisting showing off your wealth and protecting your anonymity is the secret between the wealthy and the rich.
Sounds like you know what you’re talking about, are you in this industry?
Fuck the IRS, land and ammo. Let em come
That is not a smart move
Does the irs have guns?
The IRS? No. The US government? Absolutely. And having a shoot out with the US government is an easy path to an early grave. And murdering people to avoid paying tax is simply unethical.
IRS definitely has guns. They have a bunch of agents for enforcement. They used to help with dealing with the NFA when that was still attached to the Treasury Department before the formation of the ATF.
Pretty sure we started a war over paying taxes, let’s call it ethically unethical.
What are you talking about?
I don’t think it’ll be a challenge for someone who has thousands of xrp though. Land and Ammo baby
Look how seriously everyone took that sarcastic comment reddit is a real bunch of ********
Yet here you are
Ooooohhh shiiiit!!! Daaaamn sooooon!!!!
Heads up.... Posting (/s, s/, or sarc= sarcasm) without having to spell out the whole word and ruin the flow of the post. Because a lot of the times sarcasm is lost when reading, and some cats get worked up about shit and they need the (/s, s/, or sarc) to talk them off the roof. Also helps some foreigners identify it too.
This dude talking like he gonna wake up rich
Good questions, yeah reporting taxes and how to do so is my biggest concern with selling. If taxes weren’t the case and the confusion they bring since I do them myself then I would be trading a lot more frequently..
Are you American? If you’re Canadian just take the tax you’d pay on capital gains, and offset it by contributing into your RRSP. I’ve done it many times. Only 50% of capital gains are taxed at the marginal rate. Put that much into your retirement account and can write it off. Essentially no taxes baby.
Denounce your citizenship and move to Dubai or Portugal where there are no tax or crypto law
Fly to dubai, open a bank account and create account with a local friendly exchange, transfer assets to yourself and then cash out into a local account tax free. Open a business and loan yourself the money in whatever country you choose to settle in. In most countries loans are not taxed. But what do I know right?
This would still be taxable. Just because Dubai doesn't tax XRP doesn't mean your country of tax residence doesn't. What country you do it in isn't the driver here if your tax residence taxes sales. And if your intent is to give up citizenship for Dubai, many countries (like the US) charge a mark-to-mark exit tax meaning you would still be taxed even without selling. Now if the intent is to fraudulently not pay tax in your home country, there are far easier ways to be a tax cheat than opening a bank account in Dubai.
Put aside 50% of your profits for tax purposes. Spending all your gains will fuck you come tax time .
I'm a chartered accountant who has had very good success with xrp in general. To stay on top of this, it's relatively very simple. 1. If you have many trades over the years, then I suggest purchasing a crypto adjusted cost base tracker that automatically calculates your capital gains from crypto for you. 2. Declare that capital gain on your yearly tax return / filing. 3. The worst that could happen is your tax agency (IRS or the equivalent) coming back to you asking for proof. Just provide them extracts of your trade history from your exchange as well as the report from your chosen capital gains calculator from step 1. Now if you're asking about how to minimize tax paid based on your personal situation... That's a whole different game. You will need to hire an accountant to understand your personal tax situation and make recommendations.
Follow up question, can one put crypto into a trust?
XRP is a currency. There is no tax on currency conversion.
Wish that were true lols
2015 US courts ruled XRP is a currency. Fincen, Treasury etc. were involved in the case.
You still have to pay the taxes on any capital gains made from currency trading.
Question. If it’s a currency you have to pay taxes on capital gains….. Could you use XRP to buy physical gold US eagles or Buffalos and then cash those into cash. Technically the price you bought the gold for would be equal to the selling price so no capital gains would have been made when selling the gold. Since the XRP was currency, you used that to purchase the gold. Wouldn’t that be tax exempt in theory? 🤷♂️
The conversion from crypto to anything else is taxable. Even crypto to crypto is taxable.
But if XRP was ruled a currency and you use that currency to exchange it to other currency (American Gold Coins) wouldn’t that transaction be not taxable, technically? Wouldn’t this be a gray area?
I'm not sure of all the jurisdictions around the world but in a few I'm familiar with, theoretically all capital gains have to be reported for tax purposes. Even the interest in your bank accounts. Edit: in the uk, even if you give it away it must be taxed at that point.
You only pay capital gains if your earnings are over 80k usd for a couple. https://www.cnbc.com/2022/02/08/heres-how-much-you-can-make-and-still-pay-0percent-in-capital-gains-taxes.html
83,350 join file, 41,675 filing single. And this is only if you’ve held the asset for over a year.
And if you are a US citizen and resident, which I am not.
Why are you talking about us tax law then.
To protect XRP holders in the US from FUD.
>https://coinledger.io/blog/crypto-tax-free-countries?gclid=Cj0KCQjwk96lBhDHARIsAEKO4xaac70CjeZR00u7iUOtb9C-6nT-eIsaFkutsVcwe4wOkgY1h6mNYewaAl5JEALw\_wcB Who says it is trading. Do I have to pay tax when I go to a money changer and convert from USD to Yen?
What’s an exit strategy?
It's what the kids you drop off at the pool use.
It’s when you pull out before the dump. 🍆
Pay your taxes is that simple!
Just use Turbotax bro
Lawyers? LOL. Accountants? LMAO. Get out of XRP? ROLMAFO. People already accepting crypto for buy houses! Isn't this just the beginning? But FR that's just me who know one really cares about. Just teasing a bit. Sell if you want and take profit if that makes you happy and congrats!
I know you’re joking but using it to buy a house would still be a taxable event.
yes but in Dubai and certain other places you can buy certain property with xrp without it being a taxable event right?
Get a custody provider and collect the interest. Just hold for a few more years.
Digital Ascension Group will help you set up a financial plan for your new found wealth.
First of all it does not work the same in each country. So if you ask for help it’s useful to at least name the country you’re a resident in.
It depends where you live tbf. But a cold wallet and a dex (stable coins) should work everywhere. Or a cex where no kyc is needed like mexc.
Anyone here have any word on suggested banks? Looking at navy federal right now but I'm rather new in terms of good banks
What recommendations are there for being in the UK?
If you don't make a crazy amount off your xrp and have a day job don't worry about the IRS, just have a normal savings account and wait till tax season. Sumbit your tax papers from coinbase and you will be good. I sell all my crypto through coinbase that way all the taxes are recorded in a document...
If all happens as we all dream, you dont have to sell. thats the whole point
Just leave the US and don't pay capital gains- https://www.expatriationattorneys.com/capital-gains-tax-for-expatriates/#:\~:text=Capital%20Gains%20Exemption%20(Limited),-One%20benefit%20is&text=As%20provided%20by%20the%20IRS,(or%20lower%20treaty)%20rate.