Gristle Crüe Weekly Call, 4/19/22 — Mat Sorenson

An in depth dis­cus­sion on cryp­to tax­es with attor­ney Mat Soren­son. Mat laid out an excel­lent way to think about struc­tur­ing your busi­ness & min­ing efforts when it comes to tax­es. All Gris­tle Crüe calls are avail­able to all mem­bers, when­ev­er you join.

TIME HACKS

0:00:00 — Intro
Mat Soren­son, Tax and Cryp­to Expert

0:01:03 — Mat’s Back­ground
Mat is an Attor­ney, doing invest­ments and help­ing peo­ple with retire­ment since 2006
https://matsorensen.com/
Got into cryp­to in 2017 when I (Mat) saw clients mak­ing mon­ey in crypto

0:02:36 — How should I set up an enti­ty for Heli­um Min­ing ?
Two dif­fer­ent worlds, “Hold­ing” buy­ing, sell­ing, hold­ing cryp­to. “Oper­a­tions” Mining.

0:07:11 — Is it rea­son­able to stay a sole prop
If you make over $40k in Net Income you are going to want to be an S‑corp

0:12:50 — Hob­by Income
Hob­by Loss Rule. Do you have Busi­ness Intent? Are you mak­ing mon­ey?
Exam­ple. Moun­tain Bike Rac­ing. You win a cou­ple races. You can’t write off your bike.

0:15:48 — Self Direct­ed IRAs
IRAs can own, Real Estate, Pri­vate Com­pa­nies, Small Busi­ness­es, LLCs, and Cryp­to.
https://www.gemini.com/cryptopedia/bitcoin-ira-crypto-ira-how-to-buy-crypto-with-ira

0:19:50 — I made a lot of HNT in 2021, can I go back to claim it ?
No. But, this is the time to fig­ure out what path you are going to take.

0:23:37 — First year exceed­ing $40k, Price of HNT going down, in the future I’ll be mak­ing less than $40k.
S‑Corp can be used for mul­ti­ple flows of income. Exam­ple: Min­ing, Con­sult­ing, 1099, any­thing sell­ing Goods and Services.

0:27:39 — Wash Sale
You buy cryp­to at $1000. It goes down to $600. You sell it and buy it back to “lock in” the $400 loss.

0:29:56 — Cryp­to Tax Sum­mit
Live and Vir­tu­al
TaxBit. Com­pa­ny for track­ing and report­ing Cryp­to. They are like the Tur­b­o­Tax for Cryp­to.
https://taxbit.com/

0:37:29 — Tax­es with Hosts and Split­ting Prof­its
Lots of crazy info. Check the time stamp for info.
Prob­a­bly good to talk to a CPA.

0:45:58 — Q/A Russ -
Lots of crazy info. Check the time stamp for info.

0:47:35 — Heli­um in S‑Corp held for 2 years
Lots of crazy info. Check the time stamp for info.

0:50:25 — Heli­um Min­ing in a Self Direct­ed IRA
Lots of crazy info. Check the time stamp for info.

0:52:02 — Expect­ed Depre­ci­a­tion on Heli­um Equip­ment?
Not a lot of info. But Mike says if a Min­er is $1000, a cou­ple hun­dred dol­lars per year.

0:53:01 — Where can peo­ple find you for more info ?
https://kkoslawyers.com/
Team of 15 Lawyers all famil­iar with Cryp­to
https://directedira.com/
Retire­ment Account

0:54:43 — What’s the dif­fer­ence between tak­ing your time and learn­ing vers­es hold­ing your head in the sand?
If you take some time you can save your­self a lot of mon­ey. If you don’t pay atten­tion you can end up pay­ing a lot in tax­es.
Your num­ber one expense as an investor is taxes.