People in the Bitcoin community have a number of weird beliefs with regards to how taxation works generally, then apply these beliefs to Bitcoin, and arrive at results which are internally consistent but not indicative of the world we live in.

The US taxation system is based on taxes on self-reported income. Individuals/businesses are responsible for reporting their income accurately and honestly. Some forms of income are also reported on informational returns, which makes tax evasion regarding them more difficult. Bitcoiners appear to believe that "Bitcoin doesn't structurally generate informational returns so jackpot, no taxes ever" but there are any number of things which don't generate informational returns. You're still responsible for paying taxes; the government's main remedy if you don't is still auditing a very small percentage of returns and coming down hard on people who abusively underreported income.

It is.

Not a lawyer, but my understanding is that it is handled as a capital gains tax. So you buy some bitcoin, it fluctuates wildly over the course of a week, and you convert back to fiat. You then pay taxes on any earnings from that.

So if you bought 1 flubbercoin for 900 USD and sold it a week later for 1200 USD, you are liable for that 300 USD in gained capital.

Here is a marginally more technical description https://en.wikipedia.org/wiki/Capital_gains_tax

I think that Bitcoin is like a cash. But instead of images with dead presidents, you have many 0&1 in your "wallet". Now What happens If you sell/buy something for cash? It depends on laws in your country.