Capital Loss Due to Lost Crypto

oliman on 23/04/2019 - 18:44

One of my relative incurred loss of crypto (he would like to keep the details of loss confidential). The loss is significant and is not recoverable. I would appreciate if no further questions are asked about the details of loss as he is very distressed.

After speaking with a tax agent, my relative is being told that has incurred a capital loss due to this loss of crypto. Link for details below.

https://www.ato.gov.au/General/Gen/Tax-treatment-of-crypto-c…

He has reported that loss to acorn and police.

As per his understanding, he can only claim the capital loss against future capital gains (as capital loss is carried forward every year). He is full time employee and lives in his own house, which is exempted to capital gain tax when he sells it for profit.

The only thing we can see to compensate that capital loss is to get an investment property, keep it for several years, and then sell it when the market is good, and then offset the CGT against the capital loss (incurred due to crypto).

Is there any other possible way to leverage a capital loss which is sitting in tax records of an individual?

Thank you for reading.

Financial

Comments

    • Icecold5000 on 25/04/2019 - 16:07
      +3

      Just another parasite who wants to privatise their gain and socialise their losses. If they made money on their scam the ATO wouldn’t be hearing about it.

  • [Deactivated] on 24/04/2019 - 19:57

    IT depends on how much was lost really

  • drprox on 24/04/2019 - 20:25
    +1

    Ahhh you're the tree trimming guy!

    drprox on 24/04/2019 - 20:25 (Collapsed - Offtopic. Show)
  • netjock on 24/04/2019 - 20:47
    +1

    Leverage the capital loss by investing some more!

  • p3nf0ld on 24/04/2019 - 23:40
    +2

    The correct answer is to buy more crypto & make huge gains to offset.

  • Tnetennba on 24/04/2019 - 23:41

    Is it really a capital loss if the crypto was stolen?

    • netjock on 25/04/2019 - 00:45

      You saying inside job?

  • netjock on 25/04/2019 - 00:44

    The law is pretty clear of capital gains or losses unless your friend decides to try to make an honest mistake on their tax return.

    First investment and straight into crypto hell. Unfortunate but shows why diversifying works. It isn't sexy but less likely to lose your whole investment

  • Parentheses on 25/04/2019 - 01:28
    -4

    The more important question before you go trying to claim based on the loss is to ask whether you claimed on the gain. Because that investigation could be reeeeeal messy and cause your 'friend' significant problems in a future audit. Did they report their crypto holdings (and pay tax on them) before they lost them?

    • gromit on 25/04/2019 - 08:04

      The taxable event is only on there disposal. So as long as he never sold any and only accumulated he is fine. If he was trading regularly then yeah he is up the proverbial.

  • Maglia Nera on 25/04/2019 - 09:54

    BUY A BMW

  • gezza90 on 25/04/2019 - 10:38
    +2

    I lost $8.1k in crypto and here I am using a HTC 10 with a cracked screen and 5+ yr old surface pro2, saving money through ozb.

  • amazonaddict on 25/04/2019 - 11:38

    I have always wondered what happened to the hype. All the forums in the world were full of these die hard fans of Crypto currencies. I know a person who took loan against his shop to by bit coin when it was at peek. Now, no news about it at all. Why all those people who invested so much into them are not talking about it? I can imagine major coins like BTC & ETH coming back, but the rest of the coins? Are those developers still keep developing to provide what they promised to deliver in ICO? There were stories people maxing out Credit cards to buy these stuff. What happened to them? I searched reddit to see if there are any interesting stories about the Crypto Disasters. But, almost nothing. The common theme is you won’t lose unless you sell it.

    • Cluster on 25/04/2019 - 17:44
      +1

      If you want a cynical/satirical view of crypto try this: https://www.reddit.com/r/Buttcoin/

      Almost every ICO is deep in the red since 2017. That's assuming it hasn't already collapsed to zero. There were so many scammers in the field that you had to be incredibly lucky to avoid one.

      99% of crypto coins out there are useless and virtually worthless. Only good for riding organised pumps and dumps. There are groups trying to pump the market back up again. Tether is one such group, which originally promised every tether was backed by a real US dollar. They've been diluting their claims over the past six months in steps, and now claim each Tether is backed by 'cash equivalents', loans, and investments. This will not end well.

      • amazonaddict on 25/04/2019 - 21:25
        +1

        I am having fun reading that subreddit. Thanks.

    • frewer on 25/04/2019 - 20:50

      $112 Million: French Banking Giant Societe Generale Issues Massive Euro Bond on Ethereum
      https://www.ccn.com/societe-generale-blockchain-bond-112-mil…

      Samsung Invests $2.9 Million Into Crypto Wallet Startup Ledger
      https://cointelegraph.com/news/samsung-invests-29-million-in…

      Wiki Leaks was a big player in BTC too. Julian sold most of his just before the arrested( assuming to paid for lawyer fees)

      Many stories like this, yes 95%-98% of crypto are useless coins. But the mass adoption is coming. Tread your own path.

      • amazonaddict on 25/04/2019 - 21:35

        Hmm.. Ok.. Many of those coins and their white/yellow papers never made sense to me. When small kids were reading those papers and boasting about the coins they have purchased, I felt like I need to pack my stuff and go pilgrimage seeking my ultimatum. I never understood how the proof of work which costed in thousands to make a simple transfer could replace fiat. I was ok with banks using their own network of blockchains to do a international transaction with lower cost. But, all the other small coins never made sense to me. They looked like simple smart contracts on a blockchain platform with their own version of ETH as payments. So, I never completely understood. I read some solidity programming stuff to see if I could make something off of that wave, but as soon as I opened the book the whole thing collapsed.

        But the mass adoption is coming. Tread your own path.

        These lines make me worried. What makes you think that this is going to be adopted by mass, just after it bit every laymen to their core? Who is going to enforce it to the main stream? Who is working on these?

        • frewer on 25/04/2019 - 21:48

          There are enough good vids on youtube explain how BTC works. So Im not even attempt.

          About the mass adoption is coming, it could be months or years. Who knows? However, as you can see more and more of big player come to stage. That French's bank is just one of them, rumor has it, in EU there is a finance group that in talks with the regulator to big the first crypto bank. If you interested do your own research, otherwise stay with amazon.

          Btw I came across this Moon Payment Means You Can Shop on Amazon Using Bitcoin! https://cryptocurrencynews.com/moon-payment-amazon-bitcoin/

  • Dave Bowman on 25/04/2019 - 17:45
    +2

    Did he make any trades at all, or just buy and hold? Does he have an ABN?

    If he's made trades, he may be able to fall in the classification of a trader, and incur a loss as part of his business income. See a tax agent specialising in crypto.

    • oliman on 25/04/2019 - 22:30
      +1

      Thanks

  • jammy1 on 14/07/2019 - 15:31

    Can't lose if you don't sell. Just hold it. I know many people that sold in 2017, only to see it back at the same price they bought it for now.

    But in this case, i don't understand how it can be stolen? Was it on a hardware wallet?? How can it just be stolen? Like how is it not recoverable? It's always on the blockchain just need to know the private keys. Maybe i've missed something

    • oliman on 14/07/2019 - 15:51

      The account was hacked and hacker transffered the coins to thier own wallet.

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