What’s the law?
Discussion
You have to now report gains separately for every self-hosted wallet and custodial account. You have to choose an ordering strategy (oldest, largest, etc...) for gains reporting, and you need to write a letter of intent stating your intent to comply and which ordering strategy you will use going forward. You don't have to send the letter of intent to the IRS; just keep it for your records, should you be audited.
Just adding more compliance cost. A hidden tax. Having said that, you could have a wallet of each accounting method, and have the optionality to keep the tax bill to a minimum (0). For example, oldest coins can be used on low income years (less than 40k) to lower your long term cap gains bill to 0.
I don't know if you can have homogenous cost basis strategies. My impression was that you had to apply the same strategy to each.
And that the strategy has to be the same going forward for future taxes
Well that’s bullshit 🤮
What you are describing is exactly why these safe harbor rules now exist. People started strategically picking and choosing the most advantageous strategy
Interesting. The real solution is to rid of capital gains tax on #bitcoin as it is a tax on our refusal to be debased. But until then, Inlove your idea here 😂 nostr:nevent1qqsx9t9vaa70dau5u0ehj0d7pd0dhqu8ma08e0qz885cv97qd4g7qwspzpmhxue69uhkummnw3ezuamfdejsz8rhwden5te0dehhxarj9ekh2arfdeuhwctvd3jhgtnrdaksz9mhwden5te0dehhxarj9enx6apwwa5h5tnzd9aqz9nhwden5te0wfjkccte9ehx7um5wghxyctwvsdl2s2v
Watch Matthew Kratters video from today. Pretty informative.
Tldw, I’m not doing it.
nostr:npub1s33sw6y2p8kpz2t8avz5feu2n6yvfr6swykrnm2frletd7spnt5qew252p
Word. I’m with ya. The enforcement cost of this for the IRS has to be unattainable
