Posts Tagged ‘Accounting’

Bitcoin Wallet App Development Cost and Including Features

September 29th, 2022

Bitcoin wallets are innovating at a rapid pace due to the various financial businesses that have started developing bitcoin wallet apps for their business. Since cryptocurrency is not controlled by any third party or governmental organization,Guest Posting the chances of bitcoin wallet apps being abandoned in the market are low. Various business industries like banking, e-commerce and retail stores are now adopting bitcoins as a payment option. These bitcoin wallet apps allow the user to send and receive bitcoins safely and easily.

Due to this rapid development and the enormous growth of bitcoin wallets in the market, industries have started investing in blockchain in many ways. Since bitcoins provide a safe and secure environment for users to make transactions, the demand for bitcoin wallets has been increasing in the market. Moreover, with cryptocurrency, people can now perform transactions at a very low cost or even with zero transaction charges in some cases.
How Does Bitcoin Work? Some Famous Bitcoin Apps in the Market

Blockchain – Bitcoin Wallet

Blockchain.com – a bitcoin wallet is also the best digital wallet app option for permitting the usage of bitcoin and Ethereum. A high quality cypto wallet make these cryptocurrency transactions safe, easy, and fun. A digital crypto wallet app will allow you to securely save your cryptocurrency funds, and effortlessly transact with both domestic and international users. Blockchain.com have more than 17 million people who are using this application. With various currency wallets offered and low transactions fees, it is one of the most popular cryptocurrency wallets.

The IRS Takes A Position On Bitcoin

April 23rd, 2022

Bitcoin used to be something like Schrodinger’s currency. Without regulatory observers, it could claim to be money and property at the same time.

Now the Internal Revenue Service has opened the box, and the virtual currency’s condition is established – at least for federal tax purposes.

The IRS recently issued guidance on how it will treat bitcoin, and any other stateless electronic competitor. The short answer: as property, not currency. Bitcoin, along with other virtual currencies that can be exchanged for legal tender, will now be treated in most cases as a capital asset, and in a few situations as inventory. Bitcoin holders who are not dealers will be subject to capital gains tax on increases in value. Bitcoin “miners,” who unlock the currency’s algorithms, will need to report their finds as income, just as other miners do when extracting more traditional resources.

Though this decision is unlikely to cause much turbulence, it is worth noting. Now that the IRS has made a call, investors and bitcoin enthusiasts can move forward with a more accurate understanding of what they are (virtually) holding. A bitcoin holder who wants to comply with the tax law, rather than evade it, now knows how to do so.

I think the IRS is correct in determining that bitcoin is not money. Bitcoin, and other virtual currencies like it, is too unstable in value for it to realistically be called a form of currency. In this era of floating exchange rates, it’s true that the value of nearly all currencies changes from week to week or year to year relative to any particular benchmark, whether it’s the dollar or a barrel of oil. But a key feature of money is to serve as a store of value. The worth of the money itself should not change drastically from day to day or hour to hour.

Bitcoin utterly fails this test. Buying a bitcoin is a speculative investment. It is not a place to park your idle, spendable cash. Further, to my knowledge, no mainstream financial institution will pay interest on bitcoin deposits in the form of more bitcoins. Any return on a bitcoin holding comes solely from a change in the bitcoin’s value.

Whether the IRS’ decision will help or hurt current bitcoin holders depends on why they wanted bitcoins in the first place. For those hoping to profit directly from bitcoin’s fluctuations in value, this is good news, as the rules for capital gains and losses are relatively favorable to taxpayers. This characterization also upholds the way some high-profile bitcoin enthusiasts, including the Winklevoss twins, have reported their earnings in the absence of clear guidance. (While the new treatment of bitcoin is applicable to past years, penalty relief may be available to taxpayers who can demonstrate reasonable cause for their positions.)

For those hoping to use bitcoin to pay their rent or buy coffee, the decision adds complexity, since spending bitcoin is treated as a taxable form of barter. Those who spend bitcoins, and those who accept them as payment, will both need to note the fair market value of the bitcoin on the date the transaction occurs. This will be used to calculate the spender’s capital gains or losses and the receiver’s basis for future gains or losses.

While the triggering event – the transaction – is easy to identify, determining a particular bitcoin’s basis, or its holding period in order to determine whether short-term or long-term capital gains tax rates apply, may prove challenging. For an investor, that might be an acceptable hassle. But when you are deciding whether to buy your latte with a bitcoin or just pull five dollars out of your wallet, the simplicity of the latter is likely to win the day. The IRS guidance simply makes clear what was already true: Bitcoin isn’t a new form of cash. Its benefits and drawbacks are different.

The IRS has also clarified several other points. If an employer pays a worker in virtual currency, that payment counts as wages for employment tax purposes. And if businesses make payments worth $600 or more to independent contractors using bitcoin, the businesses will be required to file Forms 1099, just as they would if they paid the contractors in cash.