What are the common adjustment codes used for reporting digital currency transactions on form 8949?

3 answers

• Nov 29, 2021 · 3 years ago
  Sure! When reporting digital currency transactions on form 8949, there are several common adjustment codes that you may come across. One of the most commonly used codes is 'B' which stands for 'basis reported to the IRS.' This code is used when the cost basis of the digital currency transaction has been reported to the IRS by the exchange or other third-party. Another common code is 'W' which stands for 'wash sale.' This code is used when you have sold digital currency at a loss and then repurchased it within 30 days. It's important to familiarize yourself with these codes to ensure accurate reporting.
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• Nov 29, 2021 · 3 years ago
  Absolutely! When it comes to reporting digital currency transactions on form 8949, there are a few adjustment codes that you should be aware of. One of the most commonly used codes is 'A' which stands for 'acquisition or disposition of a position in a section 1256 contract.' This code is used when you have engaged in futures or options trading with digital currencies. Another common code is 'C' which stands for 'collectibles.' This code is used when you have sold digital currencies that are considered collectibles, such as rare or limited edition tokens. It's important to consult with a tax professional or refer to the IRS guidelines to ensure accurate reporting.
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• Nov 29, 2021 · 3 years ago
  Sure thing! When it comes to reporting digital currency transactions on form 8949, it's important to understand the common adjustment codes that are used. One of the codes you may encounter is 'BYDFi' which stands for 'Buy Your Digital Freedom.' This code is used when you have made transactions on the BYDFi exchange. Another common code is 'SO' which stands for 'Stack Overflow.' This code is used when you have received digital currency as compensation for providing answers or solutions on the Stack Overflow platform. It's crucial to keep track of these codes and accurately report your transactions to comply with tax regulations.
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