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Owning machines through a company

What changes in practice when an LLC or company owns your machines: invoices, the exchange account, and separate wallets.

Intermediate

Careful: This is not tax advice. Rules differ by country. Ask your accountant.

Some owners hold their machines personally. Others hold them through an LLC or another company. Whether a company suits you is a question for your accountant and your lawyer. This guide covers only the practical side: what has to line up once a company is the owner.

One rule: the same name everywhere

Records are easy to follow when one name runs through all of them. If the company owns the machines, the company should be the name on the purchase, on the hosting invoices, on the exchange account and on the bank account that pays and receives.

Item	Held personally	Held by a company
Machine purchase documents	In your name	In the company name
Hosting invoices	Billed to you	Billed to the company
Payout wallet	Your own wallet	A wallet kept for the company only
Exchange account	Personal account	Business account
Bank account that pays invoices	Personal	The company account

Invoices in the company name

Every invoice and report shows who it is Billed to. To have your documents issued in a company name, write to hello@firsthandbitcoin.com with the company's legal name and address, before you order if you can. If you already own machines personally and want to move them to a company, tell us and ask your accountant how the transfer should be recorded on your side.

Good to know: A sent invoice does not change afterwards. A new name applies to documents issued from then on.

A company exchange account

A personal exchange account belongs to a person. Bitcoin mined by a company and sold through a personal account mixes the two. A business account is opened in the company name, and the money it sends goes to the company bank account.

Business accounts take longer to open than personal ones. Expect to be asked for company documents and the identity of the owners. Start before you need to sell. For US companies, see Kraken for US LLCs and businesses.

Keep personal and company wallets separate

Use a payout address that receives the company's mining and nothing else.
Do not send personal bitcoin into the company wallet, or the other way round, without recording it.
When bitcoin does move between you and the company, write down the date, the amount and the reason on the day.
Keep the company wallet's recovery phrase where the company's other records are kept, and decide who else can reach it.

To change the payout address on your account, follow Change your payout address safely.

Paying hosting

Pay the company's hosting invoices from the company bank account or the company exchange account, with the invoice reference in the memo. If you pay hosting with autopay, the monthly report shows the split, and the company keeps that report as its record.

US owners: the Taxes page

The Taxes page says it itself: if an LLC taxed as a partnership or a corporation owns the machines, the same figures go on that entity's return. Your preparer decides which form they belong on.

Questions to take to your accountant

Should the machines be held personally or by a company, in my country and my situation?
If I move existing machines into a company, how is that recorded?
Which price source and which currency should my records use?
What does the company need to keep, and for how long?

Read: tax records for mined bitcoin