Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

How The I.R.S. Will Tax Your Cryptocurrency Holdings

Published 15/02/2018, 11:30 pm
Updated 15/02/2018, 11:30 pm


Investing.com - With two months to go to the tax filing deadline, cryptocurrency investors may want to familiarize themselves with the rules.
The I.R.S. considers digital currencies intangible property, which means they fall under the rules for capital gains.
You only pay taxes if you made a profit.
The next criteria is the length of time you owned the currency.
Anything under a year is considered a short-term capital gain, and your profit is taxed as ordinary income, meaning your regular tax rate.
If, however, you owned the coin more than a year before making a profit, it is considered a long-term capital gain. Those tax rates are on a sliding scale based on your overall income.
Taxpayers in the two lowest-income tax brackets aren't subject to any capital gains. The rates for people in the other tax brackets range from 15.0% to 23.8%.
Regardless of your circumstances, keep accurate records of your transactions.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.