Is it illegal to give my friend Bitcoin for drugs?

[Fiji]

What is the name of your state? - Texas
I live in Texas and my friend wants me to give them Bitcoin in order for them to buy drugs online. I will not ever see these drugs or partake in them, I would simply just give the money to my friend so that they can buy drugs online. Will I get in any trouble for doing this?

 

[quincy]

What is the name of your state? - Texas
I live in Texas and my friend wants me to give them Bitcoin in order for them to buy drugs online. I will not ever see these drugs or partake in them, I would simply just give the money to my friend so that they can buy drugs online. Will I get in any trouble for doing this?

Will you get into any trouble for helping your friend buy drugs? Possibly.

What are the drugs? And why would you want to help your friend buy them?

 

[Taxing Matters]

Will I get in any trouble for doing this?

Let me put it this way: if law enforcement busts your friend and finds out that you knowingly provided the asset used to buy the drugs you very likely would get charged as an accomplice to your friend's crime. Bear in mind that if caught your friend might rat you out to the cops to get a better deal for himself. Also, if you knowingly provide the assets to buy the drugs and then someone is harmed by those drugs, you may be successfully sued for the harm caused. This is a stupid thing for you to do for your friend especially when you aren't getting anything out of the deal.

 

[quincy]

Although Bitcoins make it more difficult for your personal identity to be discovered, the Bitcoin transaction with your friend is recorded so the funds available for the transaction can be verified. And your identity is already known by your friend even if not (yet) known by the drug dealer (or authorities).

Should your friend get caught purchasing illegal drugs, your friend not only faces all sorts of dire consequences, including the possibility of a lengthy prison sentence, you could be subject to a criminal conspiracy charge.

No friendship is worth that risk.

 

[commentator]

In this day and time, when the drugs people are using are so much likely to be deadly, as in fentanyl, synthetics, brown heroin, any assistance you might provide your "friend" might be the instrument of killing them. And though it might take longer to figure it out, a motivated seeker would eventually find out you were the one who provided the means by which their client/son/brother/loved one died. This is an "avoid" situation all around, and the answer is yes, even if all you did was give him bitcoin to buy drugs with, it could come back on you.

 

[quincy]

The use of Bitcoins to finance transactions already is apt to send up red flags, as they are often used in money laundering schemes. That adds to the risk.

 

[zddoodah]

I live in Texas and my friend wants me to give them Bitcoin in order for them to buy drugs online. I will not ever see these drugs or partake in them, I would simply just give the money to my friend so that they can buy drugs online. Will I get in any trouble for doing this?

WILL you get in trouble? No one here has any conceivable way of predicting your future.

Here's a question for you: why are you giving your friend money so that he/she can by drugs that you "will not ever see" or use? Is your friend unable to buy the drugs on his/her own such that he/she needs a gift or loan from you? What sorts of drugs are we talking about? Why is your friend buying them online as opposed to obtaining them from a pharmacy?

Bottom line: If it's legal for your friend to buy the drugs, then there's nothing illegal about you loaning or gifting him/her the money to do so. However, if what he/she is doing isn't legal, then you would be committing a crime by financing the illegal transaction.

 

[quincy]

A real friend would not ask for money to purchase illegal drugs - and a real friend would not provide money for the purchase of illegal drugs.

What you might want to do instead of helping to feed your friend’s habit is to refer your friend to one of the many substance abuse counselors and/or centers in your state.

Here are resources to check, from Texas Health and Human Services:
https://www.hhs.texas.gov/services/mental-health-substance-use/adult-substance-use

And, if your friend is not a user but a dealer, you would be very very smart to distance yourself from him/her.

 

[FlyingRon]

What is being proposed here is flirting with a federal felony under 18 USC 1956. It's illegal to conduct financial transactions for facilitating the distribution of controlled substances.

 

[quincy]

There can be tax consequences, as well, if the virtual currency transaction is not reported as required.

https://www.irs.gov/irb/2014-16_IRB#NOT-2014-21

All things considered, it appears Fiji would be very smart to avoid this particular transaction.

 

[Taxing Matters]

There can be tax consequences, as well, if the virtual currency transaction is not reported as required.

There are tax consequences, but the IRS notice that you linked wouldn't apply to the OP. The OP is making a gift of the Bitcoin in this instance, and thus it is the gift tax rules that the OP would need to concern himself/herself with. If the value of all gifts the OP gives to his friend during 2021 exceeds $15,000 then the OP will need to file a federal gift tax return. It is the friend who would have to worry about the income tax gain or loss on the Bitcoin when the friend exchanges that Bitcoin for the drugs. That is the issue addressed by the link you provided.

 

[quincy]

There are tax consequences, but the IRS notice that you linked wouldn't apply to the OP. The OP is making a gift of the Bitcoin in this instance, and thus it is the gift tax rules that the OP would need to concern himself/herself with. If the value of all gifts the OP gives to his friend during 2021 exceeds $15,000 then the OP will need to file a federal gift tax return. It is the friend who would have to worry about the income tax gain or loss on the Bitcoin when the friend exchanges that Bitcoin for the drugs. That is the issue addressed by the link you provided.

Thanks for clarifying the tax issue for Fiji.