Taxing bitcoin something that is considered to be one of the biggest headaches known to cryptocurrency users. Not only is it a nightmare to keep track of buys and sells, along with all incoming and outgoing transactions, there’s also a debate on whether or not cryptocurrency users should even care about taxes. Regardless of the brewing controversy, the fact remains that it’s near-impossible to keep track of the numbers efficiently under the current systems.
Libra saw the trouble and is releasing their LibraTax software to the public to help keep the books in line. It’s an easy-to-use solution to the current state of taxation that really simplifies the end-user experience.
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“The recent guidance given by the IRS in March to treat digital currency as property requires that taxpayers report digital currency gains and losses on state and federal returns,” Libra said. “Taxpayers and tax professionals alike have been uncomfortable and encumbered with this manual calculation because it is extremely time-consuming and prohibitively difficult.”
It’s hard not to get excited about innovation that takes pressure off of the consumer and complies with the law, as taxing bitcoin has really dove into a gray-area of legality. The impending headache is why LibraTax looked for an innovative solution to the problem. By pushing the boundaries on what Bitcoin users once thought was possible, they’ve found a way to keep track of those pesky finances.
The Kicker? LibraTax Is All Automated.
LibraTax pulls information on your public key directly from the blockchain. Bitcoin is an open-currency, after all, and that’s what it’s meant for. Libra founder and CEO Jake Benson recently spoke at the 2014 London CoinSummit, where LibraTax was met with open arms by applause all throughout. Upon the announcement that LibraTax would go public, he had this to say:
“We’re excited that these easy-to-use, automated tools for consumers, tax professionals and accounting firms are finally available. Our primary objective is to have approachable, convenient software that simplifies the end-user experience associated with taxpaying, ultimately saving users precious time and money. We've accomplished that without a doubt.”
Libra is also developing a product line for small businesses, companies and enterprises that may need help balancing their books.
The Taxing Bitcoin Debate
This is one conversation that could go back and forth for hours. Bitcoin is a global currency, thus, it takes no residence to a specific country. Then again, the people spending the Bitcoin do take residence. How do you tax this? How can you honestly tax something that’s nearly-anonymous in nature?
Here’s some simple opinion: pay your taxes. Fund the education of your community, the repair of your roads and the infrastructure of your society. Regardless of any debate brewing on how the IRS should tax Bitcoin, the fact remains that Bitcoin users are no better citizens of their country than fiat users. Just because the currency has changed, doesn’t mean the values and ethics have as well.
That statement may receive some backlash, as it is a heated topic of discussion. That’s fine. The legalities of not paying taxes are far worse than the monetized amount that one would have to pay each year. It’s much easier to pay the taxes than sit behind bars for tax fraud.
Luckily, CCN is a free-speech website. If you’d like to weigh in on the conversation, you can always leave a comment below or start a discussion on our CCN forums.