How is Cryptocurrency Taxed?

paulsakalas — Thu, 19 Dec 2019 23:32:43 GMT

Current Revision posted to FAQ by paulsakalas on 12/19/2019 6:32:43 PM

First off, it’s important to stress that yes, cryptocurrency exchanges are taxable. In fact, the IRS is pretty clear about the topic, and has released several notifications on the taxation of virtual currencies.

In short, the federal government views Bitcoin and related digital-only currency as taxable property under U.S. tax law. As such, whenever someone sells or exchanges the currencies, it’s technically a taxable event. The same holds true for any capital gains made though trading in cryptocurrencies.

Here's an in-depth cryptocurrency tax article with some helpful links that goes in further detail on the subject.

Thinking of accepting cryptocurrency as payment for goods or services? You’ll want to read this cryptocurrency story too.

Tags: Cryptocurrency, FAQ, Tax Law, Taxation