How to hide your winnings from the government by playing on bitcoin casinos
The following is only an intellectual exploration of the theoretical question of how an individual might want to hide winnings from the government. Neither the author of this post nor the website on which it is hosted endorse or in anyway condone tax evasion. The government is a great organisation that provides many valued services to citizens. We pay all of our taxes and encourage everyone else to pay their fair share as well. This blog entry should not in any way be construed to support, endorse or defend tax evasion in any manner and is simply a theoretical examination of this abstract question for the purposes of discussion and debate.
How to Avoid Paying Taxes By Playing At Bitcoin Casinos
Alright, so you just had a big score at an online casino, but now what do you do next? If you are an American, did you know you are obligated to pay taxes on your gambling profits? Some countries gambling winnings aren’t taxable. For example, in Canada, unless you are a professional gambler or have a reasonable expectation of profit (and let’s be honest, a casino wouldn’t offer a game if they thought you could profit off it), gambling winnings aren’t taxable. But in America and many other countries, they are. So, you could hand over a nice chunk of your win to the government, or you could take advantage of the anonymity that is inherent in Bitcoin and keep all the money for yourself.
While blockchain transactions are public record, these transactions are only linked to an electronic address. So while it is possible for these exchanges to be linked back to you, this process can be quite tricky and you can obscufate matters further by using tools like a Bitcoin tumbler in a manner that is analogous to using countries with strong bank privacy laws when doing international exchanges.
While Bitcoin isn’t entirely anonymous, because the transactions are published and with information that is gained from another source could potentially be traced back to you, these exchanges are certainly significantly more anonymous than using a credit card or payment processor that is linked directly to your bank account.
If you want to cash out your winnings for cash and hide them from the government, then Bitcoin is again here the superior choice. Using a website like localbitcoins.com you can exchange your bitcoins for cash from reputable users, and this means there is no paper trail, as opposed to if you were to with a withdrawal through your bank which if you did it for a large enough transaction they would have to alert the authorities.
Technically there is a bit of a paper trail as localbitcoins.com does keep a record of the transaction and generally for large trades you do have to verify your identity. One idea might be to just do small cashouts in order to avoid any scrutiny and keep a large amount of your winnings in bitcoins themselves. Bitcoin is not only a great means of making financial transactions online but also an excellent investment that has made massive gains over the last decade and is continuing to grow at an exponential rate.
Another thing you can do if you want to hide your gambling winnings from the government is to use these funds to finance foreign travel. Bitcoin has the advantage that it can enable you to bypass foreign exchange fees. So if you wanted to go on a vacation in South American, you could bring bitcoins with you on your computer and then trade them with a reputable vendor for local currency. This way you are actually “spending” the money out of the country, and the government won’t have the same abilities to monitor this. By using localbitcoins.com you will be able to avoid currency exchange and bank machine fees which can be expensive as you will often end up paying a fee with your bank and the bank that has the banking machine itself.
If you end up just cashing a bit out at a time this won’t raise as many red flags so you can always do that. You will probably end up making a lot of money just by holding bitcoin so these cashouts might not even affect the value of your win which was increasing due to the increased value of Bitcoin. There is a massive demand for Bitcoin because it is non-inflationary as well as has great utility for making transactions with other people over the internet.
Whatever you do, don’t cash out the whole amount at once into your bank account, because this will trigger a large cash transaction report based on anti-money laundering laws and will get you investigated by the government. On the other hand, if you do live in a jurisdiction where gambling winnings are not taxable you might as well cash them out into your bank if you want or perhaps hold some in bitcoin as an investment and diversify into other investments like equities or art or what have you. Another good idea for big gambling winnings is to pay off any debt you have because paying off debt is basically the same thing as making an investment except paying off debt has a sure return.
So were someone hypothetically to want to hide their gambling winnings from the government those are a few ways you might be able to do it and things you need to be concerned about. At the end of the day tax evasion isn’t worth the risk of going to jail or suffering penalties from the taxman, so make sure to pay all your taxes if you want to stay a free man.