Bitcoin and Coinbase Tax Update

So I recently made a post about Bitcoin transactions and taxes that received a lot of attention. I wanted to research the matter further, specifically with what Coinbase is required to do.

Again, I want to express that I am not a tax professional and this is not tax advice, rather it is just bringing awareness to some facts that you should know based on my research.

Original post: https://steemit.com/bitcoin/@lifebyadam/bitcoin-altcoins-and-taxes

Site to Help Calculate Taxes

https://bitcoin.tax/

What is Coinbase Required To Do?

Coinbase is obligated to send you a 1099-K form if you operate what they deem as a Business Account and meet the threshold of $20,000 in transactions.

Read more here: https://support.coinbase.com/customer/en/portal/articles/2721660-1099-k-tax-forms

Coinbase is not required to report personal accounts, that is the end users responsibility to do so. Accurate reporting is required to avoid a future audit that the IRS may

attempt to do at some point in the future.

Ongoing Lawsuit Between IRS and Coinbase

The courts granted the IRS demands back in November of 2016: https://www.forbes.com/sites/kellyphillipserb/2017/03/20/irs-tries-again-to-make-coinbase-turn-over-customer-account-data/#441aa155175e

However, filings after this have kept the issue held up so far.

Last month Congress joined in on the discussion of the John Doe Summons that the IRS was trying to serve against Coinbase to collect information on as many as 500,000 active users.

They are seeking information on users from December 31st,2013 through December 31st, 2015. A John Doe summons is not to collect data on a specific person but a specific group of users

based on criterea such as location, in this case United States. The IRS is seeking transaction information along with profiles, names and more about these users.

Congress has bit back at the IRS wanting to know if the requested group of users can be narrowed down since many of those half a million wouldn't meet requirments to file those

earnings anyways.

The IRS has failed to meet the deadline that was given to them to respond to the questions posed by Congress, due by June 7th.

https://dcebrief.com/deadline-for-irs-coinbase-summons-response-passes-congress-still-wants-answers/

Conclusion

So it appears that Congress is standing up against the IRS and their wide spread information gathering, requiring them to be more specific and to state how this fits into

the strategy on dealing with digital currencies.

Maybe some members of congress hold coins that they don't want taxed?