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Topic	Bitcoin is down 11% from this morning
Sarcasthma 01/27/22 11:20:25 AM #38:	Revelation34 posted... Why would you need to pay taxes if it isn't currency? https://www.cbsnews.com/news/cryptocurrency-trading-taxes-irs/ *What you need to report to the IRS* The IRS treats virtual currencies as property, which means they're taxed similarly to stocks. If all you did was purchase cryptocurrency with U.S. dollars, and those assets have been sitting untouched in an exchange or your cryptocurrency wallet, you shouldn't need to worry about reporting to the IRS this year. Reporting is required when certain events come into play, most commonly: Trading one cryptocurrency for another. Selling cryptocurrency for fiat dollars (government-issued currency). Using cryptocurrency to buy goods or services (e.g., paying for a cup of coffee with cryptocurrency). A critical distinction to make is that triggering a taxable event doesn't necessarily mean you'll owe taxes, said Andrew Gordon, an Illinois-based certified public accountant and tax attorney. Just because you have to report a transaction doesn't mean you'll end up owing the IRS for it. *How cryptocurrency is taxed* Anytime you sell an asset for a profit, your resulting gain may be subject to capital gains taxation. To determine your exact gain or loss, you'll need the date you acquired the cryptocurrency; the date you sold, exchanged or otherwise disposed of it; and the cost basis (the amount you paid plus transaction fees). Gains are then taxed at either the short- or long-term rate, depending on how long you held the asset. Short-term gains for assets held less than a year are taxed as ordinary income, while long-term gains for assets held more than a year are generally taxed at 0%, 15% or 20%, depending on your taxable income and filing status. For example, say you purchased $2,000 worth of a cryptocurrency in January 2021 and sold it two months later for $5,000. That $3,000 capital gain would be subject to the short-term capital gains rate. --- What's the difference between a pickpocket and a peeping tom? A pickpocket snatches your watch. <cite>Sarcasthma posted [p:962121671] in Bitcoin is... [t:79862811]...</cite> <quote>Revelation34 posted... </cite> <quote>Why would you need to pay taxes if it isn't currency?</quote> https://www.cbsnews.com/news/cryptocurrency-trading-taxes-irs/ What you need to report to the IRS The IRS treats virtual currencies as property, which means they're taxed similarly to stocks. If all you did was purchase cryptocurrency with U.S. dollars, and those assets have been sitting untouched in an exchange or your cryptocurrency wallet, you shouldn't need to worry about reporting to the IRS this year. Reporting is required when certain events come into play, most commonly: Trading one cryptocurrency for another.Selling cryptocurrency for fiat dollars (government-issued currency).Using cryptocurrency to buy goods or services (e.g., paying for a cup of coffee with cryptocurrency).A critical distinction to make is that triggering a taxable event doesn't necessarily mean you'll owe taxes, said Andrew Gordon, an Illinois-based certified public accountant and tax attorney. Just because you have to report a transaction doesn't mean you'll end up owing the IRS for it. How cryptocurrency is taxed Anytime you sell an asset for a profit, your resulting gain may be subject to capital gains taxation. To determine your exact gain or loss, you'll need the date you acquired the cryptocurrency; the date you sold, exchanged or otherwise disposed of it; and the cost basis (the amount you paid plus transaction fees). Gains are then taxed at either the short- or long-term rate, depending on how long you held the asset. Short-term gains for assets held less than a year are taxed as ordinary income, while long-term gains for assets held more than a year are generally taxed at 0%, 15% or 20%, depending on your taxable income and filing status. For example, say you purchased $2,000 worth of a cryptocurrency in January 2021 and sold it two months later for $5,000. That $3,000 capital gain would be subject to the short-term capital gains rate. --- What's the difference between a pickpocket and a peeping tom? A pickpocket snatches your watch.</quote> ... Copied to Clipboard!
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