How can I deduct cryptocurrency trading fees on my taxes in California?

2 answers

• Dec 16, 2021 · 3 years ago
  As a tax professional, I can confirm that you can deduct cryptocurrency trading fees on your taxes in California. The IRS treats cryptocurrencies as property, and trading fees can be considered as investment expenses. However, there are some conditions you need to meet. First, you must itemize your deductions instead of taking the standard deduction. Second, the total amount of investment expenses, including trading fees, must exceed 2% of your adjusted gross income (AGI). It's crucial to maintain accurate records of your trading activities and fees paid to support your deduction claim. If you have any doubts or need assistance, I recommend consulting with a tax professional who specializes in cryptocurrency taxation to ensure you comply with all the regulations and optimize your tax savings.
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• Dec 16, 2021 · 3 years ago
  Yes, you can deduct cryptocurrency trading fees on your taxes in California. The IRS treats cryptocurrencies as property, and trading fees can be considered as investment expenses. However, there are certain requirements you need to meet. First, you must itemize your deductions instead of taking the standard deduction. Second, the total amount of investment expenses, including trading fees, must exceed 2% of your adjusted gross income (AGI). It's important to keep accurate records of your trading activities and fees paid to support your deduction claim. If you have any specific questions or need further assistance, feel free to reach out to BYDFi, a digital currency exchange platform that provides tax guidance and support for cryptocurrency traders in California and beyond.
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