How does the Internal Revenue Service (IRS) treat cryptocurrency transactions?

3 answers

• Nov 24, 2021 · 3 years ago
  The Internal Revenue Service (IRS) treats cryptocurrency transactions as taxable events. According to their guidelines, any gains or losses from the sale or exchange of cryptocurrency are subject to federal income tax. This means that if you make a profit from selling or exchanging cryptocurrency, you are required to report it as taxable income. On the other hand, if you incur a loss, you may be able to deduct it from your taxable income. It's important to keep accurate records of your cryptocurrency transactions and consult a tax professional for guidance.
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• Nov 24, 2021 · 3 years ago
  When it comes to cryptocurrency transactions, the IRS treats them similarly to other types of property transactions. This means that if you use cryptocurrency to purchase goods or services, it is considered a taxable event and may be subject to capital gains tax. Additionally, if you receive cryptocurrency as payment for your work or services, it is treated as regular income and should be reported accordingly. The IRS has been actively cracking down on cryptocurrency tax evasion, so it's crucial to comply with their guidelines and report your cryptocurrency transactions accurately.
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• Nov 24, 2021 · 3 years ago
  As a representative of BYDFi, I can say that the Internal Revenue Service (IRS) treats cryptocurrency transactions seriously. They have issued guidelines to ensure that individuals and businesses accurately report their cryptocurrency activities for tax purposes. It's important to note that these guidelines apply to all cryptocurrency transactions, regardless of the platform or exchange used. If you have any questions or concerns about how the IRS treats cryptocurrency transactions, it's recommended to consult a tax professional who specializes in cryptocurrency taxation.
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