Litecoin mining rig 2016 tax return


So the ROI period you calculated was incorrect. I was around in Spring , and there were gpus flooded on eBay but they still weren't free. I know you went on this rant to scare people so the difficulty doesn't go up, but the truth is, right now its still VERY profitable to mine. And the difficulty will keep going up and up.

In the end, unless you have a serious case to make that your mining is a "business", deductions for cost gpu's, systems, electricity, etc. I'm not impressed with the profits from my first rig. At this rate it will take 4. Not sure if this is worth the heat and noise created, or if it's a genius long term decision. I didn't even factor in loss from electricity, so payoff would be longer. Anyone without an agenda have a good insight? Use claymore's dual miner and the decred will pay your electric bill.

Mining is inherently risky. But also being in the rental business If I had it to do over again I'd probably go with the nanos.

I got in about a month ago and it's taken me a lot longer to get up and running than I anticipated. This was just a great springboard. It may work or I may totally regret it I'm not building out with more than what I've got.

I have to decide if I'm going to spend any more money on mining, or save everything. Big decision and allot to weigh out. It looks like you're new here. If you want to get involved, click one of these buttons! Fk the Irs lol. April edited April Also adaseb I'm relaxed enough it's just that these information you see here in mining are the serious stuff that many choose to put aside until it's too late to ignore.

Please if you've got things to share on why people should mine, do list it out instead of just targeting me and saying its still profitable in one sentence.

I'd like to read about it to see if I missed anything out. Oh and remember to make sure you tell the whole tale and not just the buttered up half of it.

There's always two sides of the coin. It's only about which is better. In kotarius case tho, you can never win the TAX authorities in terms of claiming tax from them instead of paying more. For every tax u claim back, you will likely have paid more elsewhere. Nice how the IRS wants to be there collecting tax at just about every transfer isn't it? They take none of the risk, but always want a cut of the profits. When did the IRS get the right to make arbitrary "rulings" anyhow?

Are they a court? Of course, they are always looking out for their own interests, not ours. At some point, someone will have enough skin in the game to challenge the ruling in court. Regarding altcoin taxation rules in the US, there's some off-base stuff going around. Brought this up in another thread a month ago. I wonder just how different the rules are in other countries, but I'm sure China and its endless supply of GPU's and electricity doesn't give a shit. Remember, you still have the basis income of the mined coin to realize in the year it was mined, whether or not you cashed them in, bought something with them, or converted them to another altcoin.

It all has to do with when a taxable event is triggered. When a coin is mined, it is counted as income by the IRS and the cash value of each coin, when mined, is your tax basis. Coins are classified as a capital asset for individuals, or possibly ordinary income for businesses. While the ruling is still not clear, the quote from the article should make it quite clear: Regardless, mined coins are counted as income in the year they were mined.

Wash rules also apply. A second taxable event is triggered when you exchange altcoins for cash, product or services.

Most people won't be able to treat mined income as ordinary like a business, and will be taxed at the highest rate when filed. Unless you like risking imprisonment; don't think this doesn't happen, my cousin is a high-net-worth accountant and has seen what happens for as little as a couple grand. Mining is inherently risky. But also being in the rental business If I had it to do over again I'd probably go with the nanos. I got in about a month ago and it's taken me a lot longer to get up and running than I anticipated.

This was just a great springboard. It may work or I may totally regret it I'm not building out with more than what I've got. I have to decide if I'm going to spend any more money on mining, or save everything. Big decision and allot to weigh out. It looks like you're new here. If you want to get involved, click one of these buttons! Fk the Irs lol. April edited April Also adaseb I'm relaxed enough it's just that these information you see here in mining are the serious stuff that many choose to put aside until it's too late to ignore.

Please if you've got things to share on why people should mine, do list it out instead of just targeting me and saying its still profitable in one sentence. I'd like to read about it to see if I missed anything out. Oh and remember to make sure you tell the whole tale and not just the buttered up half of it. There's always two sides of the coin. It's only about which is better. In kotarius case tho, you can never win the TAX authorities in terms of claiming tax from them instead of paying more.

For every tax u claim back, you will likely have paid more elsewhere. Nice how the IRS wants to be there collecting tax at just about every transfer isn't it? They take none of the risk, but always want a cut of the profits. When did the IRS get the right to make arbitrary "rulings" anyhow?

Are they a court? Of course, they are always looking out for their own interests, not ours. At some point, someone will have enough skin in the game to challenge the ruling in court. Regarding altcoin taxation rules in the US, there's some off-base stuff going around.

Brought this up in another thread a month ago. I wonder just how different the rules are in other countries, but I'm sure China and its endless supply of GPU's and electricity doesn't give a shit. Remember, you still have the basis income of the mined coin to realize in the year it was mined, whether or not you cashed them in, bought something with them, or converted them to another altcoin.

It all has to do with when a taxable event is triggered. When a coin is mined, it is counted as income by the IRS and the cash value of each coin, when mined, is your tax basis. Coins are classified as a capital asset for individuals, or possibly ordinary income for businesses. While the ruling is still not clear, the quote from the article should make it quite clear: Regardless, mined coins are counted as income in the year they were mined.

Wash rules also apply. A second taxable event is triggered when you exchange altcoins for cash, product or services. Most people won't be able to treat mined income as ordinary like a business, and will be taxed at the highest rate when filed. Unless you like risking imprisonment; don't think this doesn't happen, my cousin is a high-net-worth accountant and has seen what happens for as little as a couple grand.

No, I don't work for. Exchanging altcoins for cash and transferring the money to a bank can and likely will trigger a form, informing the IRS of your activity and tax obligations.

I stopped mining two weeks ago. Excluding short-term tax obligations, electricity and a couple gpu's, I've still made a "good" profit.

Continuing to mine for fractions more as time goes by only goes to increase cost basis. I feel bad for those who are forced to continue mining just to cover hardware, and probably aren't even thinking of those taxes that are due or the jail time that may come if they ignore it. Mining ETH is already less profitable than many people think, like alcohol was post-Volstead, even though it continues to be a thriving "business".

Especially if you're willing to ignore tax obligations and risk jail time like Capone. Have a nice day. The most relevant sections for most people here- and this is straight from the IRS. See Publication , Taxable and Nontaxable Income, for more information on taxable income.