Your friend Hui is an investor in bluecoin, a virtual currency. Indicate whether and how she is subject to Federal income taxation in the following circumstances.

a. Earns $1,000 in bluecoin from mining.

b. Purchases $1,000 in bluecoin from another friend.

c. Sells the purchase in part

(b) in the market to a third party for $1,400.

d. Spends $1,000 of bluecoin to acquire an asset worth $1,500.

e. Spends $1,000 of bluecoin to acquire an asset worth $750.

f. Holds bluecoin that she bought in February for $1,000. On December 31, the bluecoin is worth $1,200. Use internet tax resources to address the following questions. Look for reliable web- sites and blogs of the IRS and other government agencies, media outlets, businesses, tax professionals, academics, think tanks, and political outlets. Research Problem