Upcoming: New Crypto Tax Law
Your Crypto Profits Are Taxable
What You Need to Know
Earlier this year, the IRS released new guidance for cryptocurrency taxation, and it has significant implications for many Americans. Here's what you need to know to avoid tax problems when dealing with crypto.
First, it's important to understand that profits from trading crypto are subject to capital gains tax rates just like stocks. This means that if you sell crypto for a profit, you will need to pay taxes on your gains.
Buying crypto with cash and holding it isn't taxable on its own. However, the tax is often incurred later on when you sell if there are any gains.
Generally, the IRS taxes cryptocurrency like property and investments, not currency. This means that all transactions from selling coins to using cryptos for purchases are taxable events.
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