Paying Tax on Crypto in the USA (Trading, Mining, Record Keeping, Mining as a Business and more)
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- Опубликовано: 6 июн 2024
- In this video I cover the IRS guidance on how to pay your crypto tax in the USA. I also share details on how to run your cryptocurrency mining operation as a business. I'm definitely not a tax professional or accountant but I think I've learned some things along the way.
Video Links:
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Links to support me:
▶️ Red Fox Crypto Discord: / discord
▶️ NiceHash Referral Link: www.nicehash.com/?refby=e2eb3...
▶️ Awesome Miner Referral Link: awesomeminer.pxf.io/AoKqbj
▶️ Hive OS Referral Link: geni.us/Hv4AX5
▶️ Unmineable Referral Link: www.unmineable.com/coins?ref=...
▶️ CoinTracking Referral Link: geni.us/IjAa
▶️ Parallel Miner Referral Link: www.parallelminer.com/?wpam_i...
Current Favorite GPUs:
▶️ RX 6600: geni.us/ThwcRO
▶️ RX 6600 XT: geni.us/iY3VYe
▶️ RTX 3090: amzn.to/34CZrHQ
Mining Rig Parts I Use:
▶️ 6-GPU Frame: geni.us/x93J
▶️ 8-GPU Frame: geni.us/4b94Bq
▶️ 12-GPU Frame: geni.us/dQCRNd
▶️ Risers: gpurisers.com/
▶️ Risers: geni.us/Y6HWAZ6
▶️ PCIe Splitters: geni.us/UR8WAcY
▶️ MOBO: geni.us/ehB51
▶️ CPU: geni.us/lc1rZ
▶️ PSU: geni.us/d71TAI
▶️ RAM: geni.us/MmpYmej
▶️ HDD: geni.us/GsZ5uX
▶️ Test Bench: geni.us/waQ07B
▶️ PDU: geni.us/78rc
Grow Tent Setup:
▶️ Tent: geni.us/v17so
▶️ Best Inline Fan: geni.us/1BOCy7B
▶️ Inline Fan: geni.us/kDBxjft
▶️ Ducting: geni.us/fKSEo7
Power Meter:
▶️ DROC AC Power Meter: geni.us/f5XApPK
▶️ DROC Power Meter Build: • How To Build a 120v GP...
Video Chapters:
00:00 Paying Tax on Cryptocurrency in the USA
01:00 Do you pay tax when you buy crypto?
01:24 Do you pay tax when you mine crypto?
01:53 IRS tax guidance when trading crypto
03:25 Don't own more in tax than you own in crypto
04:32 Use CoinTracking.info to keep track of all your cryptocurrency activity
09:22 IRS tax guidance on mining crypto
10:09 Mining cryptocurrency as a business operation
10:44 How I run my Red Fox Crypto Mining & RUclips business
11:34 Deducting expenses from income example
13:21 History of running Red Fox Crypto at a loss, expanding, and taking a paycheck
15:14 Personal tools and resources I actually use
Crypto Miners:
📺 BitsBeTrippin: / bitsbetrippin
📺 Voskcoin: / @voskcoin
📺 Red Panda Mining: / @redpandamining
📺 The Hobbyist Miner: / @thehobbyistminer
📺 Sebs Fintech Channel: / sebsfintechchannel
📺 ChumpChangeXD: / @chumpchangexd
📺 Hash Raptor: / @hashraptor
📺 SerpentXSF: / serpentxsf
📺 SavageMine: / savagemine
📺 Guntis Vitolins: / talibanfighter123123
📺 The Life of a Miner: / @thelifeofaminer
📺 Altered Component: / @alteredcomponent
📺 Mining Office: / @miningoffice
Follow me:
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✅ Instagram: / redfoxcrypto
As an Amazon Associate I earn from qualifying purchases.
#cryptomining #bitcoin #cryptotax #cryptotaxes #gpumining 
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What about space used in your house, mileage to and from microcenter, business meetings at lunch for more knowledge. 6000 pound vehicle deductions. Cost of replaceing broken items etc.
Yes to all
Interesting about the vehicle. I have a hard time convincing my tax person that the truck I bought was for the mining business, since the mine was on my property and I couldn't explain regular use of the vehicle for the business. Going to MicroCenter wasn't valid use for a "business vehicle", based on my guy, but the mileage reimbursement for a personal vehicle was. My tax guy is a retired IRS agent, so I trust him, but your tax person may be more "flexible"... I don't want to deal with an audit for something marginal, at best.
@@Average_Geo you are probably right about the mileage only in the case you wkrk from home.
Being paid at my job as a 1099 has honestly been a masterclass in how to run a business. When I started mining, thankfully I had the sense to start a separate gig just for that and run it the same way. Writing hardware off is honestly like cheat codes as long as you're consistent with your moves. I have gotten warnings from TurboTax about showing a loss for multiple years, so every now and then I'll make sure I show a small profit.
Every year I get better at this. Thanks Mike for sharing your experiences. It’s always helpful
Fantastic info Red Fox!
Nice one, thanks for doing this video, I'm sure it will be very useful to many ! Love the chill tunes man 👌🕺🕺
Thank you for the video 😊
I got into crypto and mining in 2022. I still have not gone the LLC route. I have not had huge tax gains yet as I just been hodling it. Koinly has worked well for me so far.
Thank you ✌️
Hey Mike, any thoughts on LLC vs sole proprietorship? Is the only additional LLC benefit reduced legal liability?
So Mike, question. What about if you move that crypto asset to a stable coin then a month or two later you buy another token. Haven't you simply delayed paying your capitol gains until you sell the 2nd crypto asset for US dollars? Great video as always!!
very helpful thanks! I just started small biz for mining this year after 5 years of hobby mining. I was wondering how to calculate power into taxes i would be interested to see how you do it for your biz. ✌️
Good points, the taxation rules are bit different in all countries. What you want to seriously check the taxation about, is trading. In some countries if you buy/sell cryptocurrency in exchange (trading it) there you can end up seeing a situation that you must pay taxes for profits for every trade, but you can NOT deduct the taxes from the trades with losses. I believe this must be an (greedy government) error in some rules in some countries just to be corrected sooner or later, but you want to make sure you doublecheck this before you put money in. One way to mine without need to pay income tax: mine coins which are not tradeable (basically, new speculative coins which have no set price anywhere)
Quick question....what level of contracting to you utilize? Free, pro, Expert or?
Thank you! Ive been looking for something like this. I want to get ahead of this "tax" game! Much appreciated...🤘🏻
You made it sound much easier than it really is 😢, thanks for the tips though
Taxable event for passive income from mining a certain coin. What about selling the coin for fiat, another taxable event? Double tax event?
Do us miners have to pay tax kn the crypto when we sell it for fiat too? Or only when we receive it?
If we agree the effective life of RTX 4090 is 4 years. You can deduct ~$500/year from taxable income. Is it right? How it is calculated in your area?
what are these taxes that you speak of?
I wish I was educated enough to fight the irs and ask them for there wallet address so I can pay the % I mined!
When someone mined 0.5 BTC in 2024 and didnt sell that BTC. He paid $30,000 for the power and service. What would be the tax in your area?
Do you also have to pay taxes if let's say you are mining with a few 6-7 gpu's? We are talking about penny profits here
Yes but if you aren’t selling on an exchange then there is no way for them to find out.
Its bullshit that i have to pay tax on mining income.
Lets say i mined 5 btc. I have to pay tax on that "income".
Then lets say i sell it all later for fiat and cash out. I have to pay tax on it again?
If it’s worth more than the price at which you mined it at you then yes you have to pay capitals gains tax on the profit.
what about neox Inode????
wondering the same thing
But what happens if you pay taxes on earned crypto. And the crypto drops.. Do you then claim as a loss for that year..
You can only claim as a loss if you sell it.
@@RedFoxCrypto So pre-emptively pay tax...rigged. lol
Whatever mining coins means, i think they got lost in that boating accident that claimed the firearms i used to own. 😂
1 word, monero
Crypto shouldn’t be Taxed, this is Stupid
The irs is evil
Tax is slavery. So, yeah we shouldn't run our society off of it.
Stop dumping all your crypto for useless inflated fiat and you will not have problems with taxes anymore.
See issue solved mate, i did not need an almost 20 minutes video to fix it lol
Joke aside, have a great week my brother, may decentralization be with you 🙏🏽💪🏽
bullshit come to kuwait electric free no tax just relax
glad i only have to pay 0.11% tax on crypto