(Get paid in Bitcoin to skip 1 & 2)
1. Setup direct deposit with CashApp
2. Convert Fiat to #Bitcoin
3. Buy goods/services using BitRefill, TheBitcoinCompany, Fold and nostr:npub16s47l3qakjc204n9weuzdptv3ewadgvasgz2gm4mus8ftp0ss9pqm4ux4x
4. Stop using Fiat altogether
5. Congrats you are now living on a Bitcoin Standard!
It really is this simple folks!
What do you think? Am I missing anything? Any advice or shameless plugs for additional services?
Yes I know this is simplified to an extent and there are probably one-off incidences that you have to use the legacy financial systems for, but as the Bitcoin ecosystem gets larger and more mature, the need for the old system dwindles!
However, I’d argue that there is a company/service for just about everything in the Bitcoin ecosystem present day though. You just need to do the research and/or network to find it!
I need help understanding how to handle all the tax complexity of “selling” Bitcoin.
Cash App is KYCd, so the IRS knows the amount of BTC income; which means that technically every UTXO that leaves my wallet needs to have Capital Gains Tax calculated on it?
Which means I’d’ have to manage purchase dates, amounts and prices for all UTXOs? And then calculate the gain or loss on them when I sell them for fiat?
Ugh.
Yeah, so it’s only subject to capital gains/losses reporting if you trigger a taxable event.
Taxable events for Bitcoin (as it’s currently coded) are:
1. Converting into another crypto asset
2. Selling for Fiat
3. Exchanging Bitcoin for goods/services (paying with it)
CashApp only reports what you currently hold and/or bought, sending to an external wallet you hold or keeping it in CashApp doesn’t trigger a taxable event.
Additionally, Cashapp provides you with your tax forms and comes with free filing.
TLDR - Don’t sell your Bitcoin for Fiat or use it to buy things while the funds are tagged as KYC (You shouldn’t want to sell your Bitcoin for fiat on principle anyways😉)
*Not Financial or Tax Advice - DYOR
