Do you have to pay tax on bitcoin gambling winnings?

Discussion in 'General Bitcoin Gambling Discussion' started by 2damoon, Jun 16, 2016.

  1. 2damoon

    2damoon Member

    If I win a ton of money at a bitcoin casino or playing high stakes poker, will I still have to pay the IRS a big chunk of it or is it tax free?
    BK8 likes this.
  2. Humble Servant

    Humble Servant Active Member Staff Member

    Last edited: Mar 7, 2019
  3. Get yourself a Xapo bitcoin debit card and next time you go on vacation abroad charge everything to the card. How's the IRS going to know.
  4. Smug Satoshi

    Smug Satoshi Member

    Don't forget that you can offset your losses against your winnings. You would be surprised by the number of people who declare their gambling winnings to the tax authorities but forget that they also lost large amounts of money throughout the year.
    BK8 likes this.
  5. 4TheWin

    4TheWin Member

    Does anyone have a link to an official document or website relating to tax on bitcoin gambling profits in the US?
    BK8 likes this.
  6. Humble Servant

    Humble Servant Active Member Staff Member

  7. Smug Satoshi

    Smug Satoshi Member

    I've never paid tax on money I won gambling but please don't tell that to the Australian Tax Office. I'm in enough trouble with them already!
  8. NKOTB

    NKOTB Member

    Which is lower, the tax on capital gains or gambling profits?
  9. Humble Servant

    Humble Servant Active Member Staff Member

  10. Kaboom

    Kaboom Member

    i hope that one day I will never have to convert my bitcoin into dollars and that'll i'll be able to buy 90% of my day to day items with bitcoin. the irs can only catch you if you convert your btc to dollars.
  11. Freddy

    Freddy Member

    Do bitcoin friendly gambling sites like Bovada or 5Dimes keep track of their U.S. players tax obligations? Is there any chance that they would report your bitcoin deposits and withdrawals to the IRS?
  12. Humble Servant

    Humble Servant Active Member Staff Member

    Companies like Bovada and 5Dimes are based offshore so I doubt they have any contact with the Inland Revenue in the United States.

    While offshore gambling operators will not report your bitcoin deposits to the IRS, companies like Coinbase might. Coinbase are currently in a big legal battle with the IRS because the IRS are looking for details off every U.S. user for the past 4 years. They were even requesting that Coinbase supply them with each users passwords and security settings, which seems ludicrous. Thankfully Coinbase won that battle...

    BK8 likes this.
  13. Gooch

    Gooch Member

    in about 10 years i'm going to cash in all my crypto and hopefully i'll be paying millions in capital gains tax. right now i don't bother paying tax on a few nfl bets.
    BK8 likes this.
  14. Humble Servant

    Humble Servant Active Member Staff Member

    The IRS requires that 0.25% excise needs to be paid on legal wagers and 2% excise has be paid on illegal wagers at offshore gambling sites.
  15. Doyle

    Doyle Member

    If you don't plan on paying your taxes, then for the love of god don't use Coinbase because they will report you to the IRS.
  16. Humble Servant

    Humble Servant Active Member Staff Member

    Here is a useful guide on how to pay cryptocurrency taxes in the United States....

  17. BeastyBoy

    BeastyBoy Member

    most people saw an 85% drop in the value of their bitcoin holdings this year so i don't think the irs will be making too much money from crypto investors in 2018.
  18. Doyle

    Doyle Member

    If you use Coinbase you need to pay tax because they'll automatically report you to the IRS. This week they even proudly bought an analytics company to track their customers activity. Avoid Coinbase if you can (even though I know they are convenient)

    BK8 likes this.
  19. Humble Servant

    Humble Servant Active Member Staff Member

    Incase anyone missed it last week, the Treasury Secretary Steve Mnuchin, made a briefing on new cryptocurrency regulations. It looks like a whole new range of regulations will be implemented for United States cryptocurrency users. My guess is that it will become a lot harder for US citizens to quietly sell their bitcoin without having to pay capital gains tax. Even Americas living in other countries will likely get automatically reported to the IRS if they sell a substantial amount of crypto in any given year.

  20. crazy lover

    crazy lover Guest

    Good question. I have never met information on this subject.

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