YOU ARE HERE: LAT HomeCollectionsTemple City This post has been corrected.See the note below for details.The Internal Revenue Service said Tuesday that bitcoin would be treated and taxed as property, a decision that is part of wider efforts to bring more oversight to the controversial digital currency.In its first big ruling on bitcoin, the agency noted that "it does not have legal tender status” and will be taxed under codes that apply to property transactions.That means wages paid to workers in bitcoins will be subject to federal income and payroll taxes.Those who “mine” virtual currencies -- or create new bitcoins by solving complex math problems -- will have to report their earnings as taxable income.Bitcoins can also be treated as capital assets, regulated under the same rules that govern stocks and bonds, the IRS said.PHOTOS: World's most expensive citiesThe agency’s decision was applauded by Sen.Thomas Carper (D-Del.), who has called on the U.S.government to lead the way for regulating bitcoin and other virtual currencies.The guidance “provides clarity for taxpayers who want to ensure that they’re doing the right thing and playing by the rules when utilizing Bitcoin,” Carper said in a statement Tuesday.Bitcoin, which has gained a following among ordinary users and companies alike, has attracted scrutiny from lawmakers in several countries around the world.

The currency is not controlled by any government or central bank, and has lately been at the center of several controversies that critics say highlight the need for more oversight.PHOTOS: Richest and poorest cities in AmericaMt.Gox, a bitcoin exchange that was once the world’s largest, filed for bankruptcy protection in February after losing 850,000 bitcoins worth more than $450 million (a big chunk was later recovered).Bitcoin was also the currency of choice for users of Silk Road, an online marketplace that sold drugs, fake passports and other illegal goods and services.The alleged founder was arrested last year and later indicted on multiple charges, including money laundering.A Newsweek magazine story this month named Dorian Satoshi Nakamoto of Temple City as the creator of bitcoin, an allegation that triggered a media frenzy and car chase through the streets of downtown Los Angeles.Nakamoto has repeatedly denied any involvement in the currency.[UpdatedPDT March 25: An earlier version of this post stated that the founder of Silk Road was arrested last year.

Ross Ulbricht, the man accused of creating the website, has denied any role in founding or controlling Silk Road.]ALSO:More than 1 in 4 Americans go to work while sickPerry says California companies created 14,000 Texas jobsFollow Shan Li on Twitter @ShanLi Seizure Led to FloJo's DeathHis 104 scores make his caseRestaurant review: South Beverly GrillBrutal Murder by Teen-Age Girls Adds to Britons' ShockComaneci Confirms Suicide Attempt, Magazine SaysSAN FRANCISCO — The Internal Revenue Service is on the hunt for people who used Bitcoin to evade taxes.The tax agency sent a broad request on Thursday to Coinbase, the largest Bitcoin exchange in the United States, asking for the records of all customers who bought virtual currency from the company from 2013 to 2015.The document, a so-called John Doe summons, said that an I.R.S.bitcoin fiyatlariagent recently found three cases in which people were using Bitcoin to evade taxes — two of which involved Coinbase customers.The I.R.S.bitcoin banco de portugal

said that those findings — and Bitcoin’s relatively high level of anonymity — have led the agency to think that many more people are using the virtual currency for similar purposes.not only has suspicion that the John Doe class includes U.S.taxpayers who are not complying with the law — it knows that the class in the past included such violators, and very likely includes others,” the document says.The summons comes shortly after the Treasury Department’s inspector general issued a report chastising the tax agency for not taking more aggressive action to curb “unlawful activities by those who use virtual currencies.”“None of the I.R.S.bitcoin authority in indiaoperating divisions have developed any type of compliance initiatives or guidelines for conducting examinations or investigations specific to tax noncompliance related to virtual currencies,” the report, delivered in September, said.The request this week would require Coinbase, a start-up based in San Francisco with funding from several leading venture capital firms, to turn over the identity and full transaction history of millions of customers — it had about three million customers at the end of 2015.sell bitcoin for dogecoin

But the company is already gearing up to fight the request.“We want to work with law enforcement — that’s generally our policy,” the company’s head legal counsel, Juan Suarez, said Friday.“But we can’t tolerate sweeping fishing expeditions.We are very concerned about the financial privacy rights of our customers.”The existence of the summons was reported earlier on Twitter by the financial blog Zero Hedge.The request from the I.R.S.appears to be the most sweeping single effort to track down people using virtual currency to break the law.In the past, Coinbase has received narrowly tailored requests for information about customers, and generally complied, Mr.bitcoin angela merkelSuarez said, but never something as broad as the latest summons.bitcoin per paypal kaufenCoinbase and other companies that buy and sell Bitcoins are required by regulators to record the identities of people who buy and sell virtual currency on their platforms.The underlying Bitcoin wallets, however, are tracked by a decentralized network of computers that generally do not record the identities of the people involved in transactions.bitcoin mining blue screen

A Bitcoin wallet looks like a series of random letters and numbers, and anyone can open one without providing their identity.The most famous early use of Bitcoin came on the Silk Road, an online site where users could pay for drugs with Bitcoin, with the understanding that their identity would never be recorded.The documents filed this week indicated that the tax agency was interested in going after both large tax evaders as well as small-time Bitcoin users who might not be recording their virtual currency transactions properly for tax purposes.bitcoin mining playstation 2The basic tax rules for Bitcoin users were set down by the I.R.S.ethereum brokerThe agency’s guidance said that people should treat their virtual currency as property, rather than currency, for tax purposes.If a person buys a Bitcoin for $200, for example, then sells it later when its value has risen to $400, the $200 in gains are supposed to be recorded to the tax authorities.Omri Marian, a professor of tax law at the University of California, Irvine, said that most Bitcoin users were probably not aware that they were supposed to record their losses and gains as taxable events every time they bought anything with their Bitcoins.“It may be the case that many people were not aware that what they were doing is taxable,” Mr.

Marian said on Friday.“Are those the people the I.R.S.is looking for?”An I.R.S.agent, David Utzke, said in a document filed on Thursday, along with the summons, that he was already pursuing larger offenders.Utzke said he identified two companies that were buying Bitcoin and misreporting them with the I.R.S.Utzke said both of the companies were customers of Coinbase.The companies themselves were not named in the document.Coinbase provides its customers with information about the gains or losses they make on every virtual currency transaction.The tax agency, however, said it was not getting the information it needed to determine whether Coinbase users were making the proper tax payments.“The risk/reward ratio for a taxpayer in the virtual currency environment is extremely low, and the likelihood of underreporting is significant,” Mr.“The characteristics of virtual currencies could enable them to replace traditional abusive tax arrangements as the preferred method for tax evaders.”