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Planning is really hard. My best guess is bitcoin price will go up fast soon and then down fast and then up slowly and then up fast…

Bitcoin doesn’t make timing the paying for college in 2 years easy. I think I’m best served keeping credit available to borrow for a year or two of college expenses and wait for proper bitcoin lending to develop (and to my knowledge, all bitcoin lending programs existing today by definition trigger a capital gains tax because you transfer custody and ownership to secure the loan).

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Discussion

𝕞𝕪𝕡𝕒𝕥𝕙𝕥𝕠𝕗𝕚𝕣𝕖 5mo ago

For most things you can get unsecured fiat loans. Why risk your bitcoin?

Shawn 5mo ago

That last bit is not how I understand it to work. Check in with @Satoshi Pacioli Accounting.

Rich Nost 1mo ago 💬 1

nostr:npub1clk6vc9xhjp8q5cws262wuf2eh4zuvwupft03hy4ttqqnm7e0jrq3upup9 have you used this accounting firm before?

Dr. Bitcoin, MD 1mo ago

Tax is ultimately resolved by courts. If someone else owns your bitcoins, you get taxed on any gain the moment you transfer them.

Rich Nost 1mo ago

My understanding is the taxable event is triggered at liquidation of the collateral. That is when a sale is recorded.

Dr. Bitcoin, MD 1mo ago

That doesn’t matter at all. It only matters when it changes ownership. And ownership of bitcoin can arguable have different meanings which is why it will be up to a court to decide.

Rich Nost 1mo ago

But if this were the case, the entire buy-borrow-die strategy (not only the Bitcoin collateral use case) would have no tax advantage, but it clearly does.

Dr. Bitcoin, MD 1mo ago 💬 1

No it wouldn’t. For example, you can own a house and use it for collateral without losing ownership. This is settled case law.

Bit transferring ownership of bitcoin to a trust structure like a 2 of 3 multisig may not get the same treatment.

Shawn 1mo ago

This is simply not true.

Dr. Bitcoin, MD 1mo ago 💬 1

Oh good. I’m so glad to hear it.

Your mileage may vary.

Shawn 1mo ago

This is an odd fixation to have.

How would Unchained or similar operate if their clients had to incur capital gains to merely become a client?

Dr. Bitcoin, MD 1mo ago 💬 1

Well, if you ask them whether it’s a capital gain they hedge and don’t directly answer the question.

Remember, what we want as bitcoiners isn’t necessarily what will become true. Plan for all cases and don’t be the guy that has pay for the corresponding court case.

Shawn 1mo ago

No, they don't. I'm a client. Let's ask nostr:npub1m6y9qq06c74trgs60ya320pgmhz6099grra5lw04akyuxvcz7lvq9ue2p9.

Dr. Bitcoin, MD 1mo ago

Yes. Get him to commit in writing. Unlike on their website.

Dr. Bitcoin, MD 1mo ago

🍿

Shawn 1mo ago

Like I said, odd fixation.

Trey 1mo ago

nostr:npub1fa8c9prxnrlkdtjl48adfsxyaduz8tas075l2n4f6903y9awjmxqanthnd I assume you know I can’t give you tax advice, but I can point you to the resources for you to DYOR and understand our position and how we approach it:

https://help.unchained.com/what-is-loan-collateral-and-what-does-unchained-do-with-it

https://www.unchained.com/blog/ultimate-guide-bitcoin-loans?_gl=1*c3ao0f*_gcl_au*MTYwODcyMDQwMi4xNzYwNDc2MTQ2*_ga*NDkyNDgxNjkyLjE3NjA0NzYxNDY.*_ga_N2E2DZCQWE*czE3NjQzNDA4NTUkbzIxJGcxJHQxNzY0MzQwODY0JGo1MSRsMCRoNDU2MDc0NjQx

Dr. Bitcoin, MD 1mo ago

Change of ownership is the legal question. And I can totally understand the desire to hint without directly stating that the definition of ownership for bitcoin moved to a collaborative custody model is the one that permits your business model to exist.

But that legal risk remains…

Shawn 1mo ago

They are my guys, yes.

Rich Nost 1mo ago

I presume you are satisfied.

Shawn 1mo ago

They wouldn't be my guys if I weren't. 😉

Yes. Talk to nostr:npub1w00myu2dzuq8t05ks0hfz4jgd66aarf5m5u6s7w2mtj52xr9v32s0qwa8u.

Houndsfield's Unit 5mo ago

As far as loans go, federal student loans ain't bad. 4 years of subsidized deferment, forgivable upon death and multiple other ways to get them partially/fully paid for. Rates are not horrible and you can pay them off over decades.

Leave the gold in the vault and pay the fiat loans with deppreciating fiat. Reevaluate post graduation.

And as always, borrow as little as possible and use that money as wisely as possible.