Worldwide, there are many different rules about the taxation of crypto currencies. There is a lot of confusion.
I am pretending I am a Steem farmer. I believe the rules applied to farming will eventually be transferred to Crypto.
When I write a post, it is the same as a farmer planting a grain of corn. I am not required to track the eventual return of each individual seed. Farmers ar free to buy large amounts of seed and plant as they wish.
When harvest time arrives, the farmer is not required to record the date, time, and yield of his crop. He has options.
- Sell the grain
- Store the grain
- Process the grain (grind it into meal
- Feed the grain to animals
- Choose a mix of the above options.
A Steem farmer has similar options:
- convert it to fiat
- Hold Steem hoping for a future price increase
- Process the Steem (convert it into a different crypto)
- Feed the grain to other people (barter it)
- Choose a mix.
My point is that until the farmer somehow converts his crop to dollars, income taxes do not apply. Since the Steem farmer plants his seen in network space, there are no property taxes due. If the Steem farmer gifts his crypto, similar gift or inheritance taxes should apply.
Let’s pretend... I sow my seeds into Steemit. I hold my resulting Steem rewards. The price rises. I trade my Steem for a very valuable painting, a prize bull, and a large bag of Silver. I gradually give my silver to my children. I hang my picture on the wall. The bull breeds my livestock.
According to ‘farmer’ rules, no taxes are ever due. I think.
Here is today’s beauty.