It may not apply in a trade, where you exchange Btc for a good or service of equal value. You will have to keep up with your basis and/or expenses if you sell/cash out for FRNs, as with any asset such as equities and etc. I'm no tax expert by any means however.
The determination of cost basis would be for every transaction, no matter how minor. From the linked article:
“Today’s IRS guidance will provide certainty for investors, along with potential income-tax liability. Under the ruling, purchasing a $2 cup of coffee with Bitcoins bought for $1 would trigger $1 in capital gains for the coffee drinker and $2 of income for the coffee shop.”
From zerohedge:
Is a person who “mines” a virtual currency considered to have received income?
Yes, and if the taxpayer engages in mining as a trade or business, self-employment tax is often due.
This is going to be a problem.
Bitcoins are fungible and globally mined. If a US company issues “Equity/Stocks” is that a taxable event? I don’t think it is.