What are the tax implications of forex trading with cryptocurrencies in the US?

3 answers

• Dec 16, 2021 · 3 years ago
  When it comes to tax implications of forex trading with cryptocurrencies in the US, it's important to understand that the IRS treats cryptocurrencies as property for tax purposes. This means that any gains or losses from forex trading with cryptocurrencies are subject to capital gains tax. If you hold the cryptocurrencies for less than a year before selling, the gains will be taxed as short-term capital gains, which are typically taxed at your ordinary income tax rate. On the other hand, if you hold the cryptocurrencies for more than a year before selling, the gains will be taxed as long-term capital gains, which are usually taxed at a lower rate. It's crucial to keep accurate records of your trades and report them properly on your tax return to ensure compliance with the IRS regulations.
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• Dec 16, 2021 · 3 years ago
  Ah, taxes! The inevitable topic that comes up when talking about forex trading with cryptocurrencies in the US. Well, here's the deal: the IRS considers cryptocurrencies as property, not currency, for tax purposes. So, when you make gains or losses from forex trading with cryptocurrencies, you'll be subject to capital gains tax. If you hold the cryptocurrencies for less than a year before selling, you'll be slapped with short-term capital gains tax, which can be quite hefty depending on your income bracket. But if you manage to hold on to those cryptocurrencies for more than a year, you'll be rewarded with long-term capital gains tax, which is usually lower. Just remember to keep track of your trades and report them accurately on your tax return to avoid any trouble with the IRS.
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• Dec 16, 2021 · 3 years ago
  When it comes to the tax implications of forex trading with cryptocurrencies in the US, it's important to consult with a tax professional or accountant who specializes in cryptocurrency taxation. Each individual's situation may vary, and it's crucial to ensure compliance with the IRS regulations. At BYDFi, we recommend seeking professional advice to navigate the complexities of cryptocurrency taxation. Remember, it's better to be safe than sorry when it comes to taxes!
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