CBI spread and tax deduction question

[Twincougars]

Lets say you buy a bunch of dinars for $X and when the RV comes, you unload them for a profit, which would be (assuming you reported it to the IRS) taxable as capital gains. However, embedded in that transaction is the CBI spread, which is, IMO, is an expense in doing the exchange of dinars to dollars, and therefore should be a deductible expense. What do you think?

[jgreene]

kinda hard to believe in any of it when you get on this website and there is advertisement still to purchase dinar at 1220 per million with a bonus 50 dollar note with each purchase....

[okane]

In a word, No. Because you are only reporting what the bank gives you, the gain. The expense has already been taken out before you get it.

[Captjohn]

Lets say you buy a bunch of dinars for $X and when the RV comes, you unload them for a profit, which would be (assuming you reported it to the IRS) taxable as capital gains. However, embedded in that transaction is the CBI spread, which is, IMO, is an expense in doing the exchange of dinars to dollars, and therefore should be a deductible expense. What do you think?

You may choose to not report an exchange, but be assured that the bank or dealer you exchange through will be filling out a federal report on the exchange that will go to the IRS. Don't report at your own peril.

[tankdude]

You might want to take a look at this thread -

Especially execonsultant. I agree with him - I don't expect capital gains to be involved. I'm going to get with a good tax attorney at RV time, but I do feel it will be done as Regular Income.

As for reporting - cash transactions and deposits of more than $10,000 are required to be reported as "significant cash transactions" to the Financial Crimes Enforcement Network (FinCEN), along with any other suspicious financial activity which is identified as "suspicious activity reports".' Bank employees are required to report this activity when they see it.

[dhardage]

In a word, No. Because you are only reporting what the bank gives you, the gain. The expense has already been taken out before you get it.

I agree