This really depends. Are you dipping into your stack to pay these transactions?
My best advice came from Saylor a year or so ago:
Say I want to tip a waiter/waitress in #Bitcoin, I have my lightning or liquid wallet preloaded with sats, I go on an exchange and buy $20 worth, and then however many sats that gets me, I send it to him/her. This doesn't create a taxable event because I bought and gave it away same day for exact same value.
I do the same thing with purchases. I pre-ordered nostr:npub1gdu7w6l6w65qhrdeaf6eyywepwe7v7ezqtugsrxy7hl7ypjsvxksd76nak gold standard book. Bought the $30 of Bitcoin and then sent the lightning payment to him. No taxable event.
The only time you need to keep track is with your cold storage purchases that you sell. For that I usually keep a spreadsheet. Or have to look at the exchanges where I buy and calculate that way.
I see. Yes I keep these things separate. I don’t touch anything in cold storage. It’s like wine in the cellar.
Technically a same day non gift transaction (tip can be classed as gift) is still a reportable event here but I begin to feel the consensus is don’t bother about tiny amounts even if they are non gift transactions. I guess it’s a YMMV thing. Thanks.
You're right that those are taxable events still. If you want to have a recipient receive Bitcoin without a taxable event on your side, you can send from your dollar balance in Strike to a lightning invoice or Bitcoin address.
Good idea. So do you declare peanut amounts?
It's not declaring peanut amounts, it's just not taxable for you at all. You're sending dollars. The taxable event is 100% on Strike's side and they track all that (again, for themselves, not for you) as part of their business.
Oops sorry. My question wasn’t clear. What I meant was, when you do occasional small scale crypto to crypto stuff (say 1-10 bucks) that can’t be classified as gift, do you keep a record of those and declare them? If so, what do you use to keep track? Or do you just ignore these?
