Cryptocurrency and Taxes

[jij]

Hi guys,

I was wondering how to do my taxes in US.
I’ve bought some amount of cryptos on Coinbase, then moved them in binance and has been exchanged for other cryptos.
Once I pay those taxes this year and keep the crypto as an investment, do I have to pay taxes next year, if I don’t trade, sell or cash out them? Also, what if I decide to send all of my crypto to someone else, and they don’t belong to me anymore?
Sorry if it’s been discussed, but the whole tax thing is very confusing to me. I heard something about new tax bill that will affect crypto trading.

Thanks!

[1715182556]

1715182556

[1715182556]

1715182556

[1715182556]

1715182556

[1715182556]

1715182556

[ImNewAnDontKnowWhat2Do]

Hi guys,

I was wondering how to do my taxes in US.
I’ve bought some amount of cryptos on Coinbase, then moved them in binance and has been exchanged for other cryptos.
Once I pay those taxes this year and keep the crypto as an investment, do I have to pay taxes next year, if I don’t trade, sell or cash out them? Also, what if I decide to send all of my crypto to someone else, and they don’t belong to me anymore?
Sorry if it’s been discussed, but the whole tax thing is very confusing to me. I heard something about new tax bill that will affect crypto trading.

Thanks!

I'm not a CPA and this is still uncharted territory.  I believe you don't have to pay until you cash out to fiat, pretty sure thats how it goes. Hope this helps. Definitely interested in  hearing what a CPA and the 2018 tax book says about this.

[Boojapho]

The rules are very vague for U.S. taxes.  Last year, I treated my coins like stocks.  When I transferred coins out of a pool after mining, I paid capital gains on the avg. price of the coin that day times the quantity.  Then, every time I sold coins, I would estimate the U.S dollar equivalent and compare it to what I bought it for.  I'd take a loss or profit based on that.  I also treated mining as a business and took off part of my electric bill and home space for my miners.

A lot of people were skirting taxes by claiming that exchanging coins is a "like kind" transaction.  But, that tax rule is really for real estate, not commodities or currency.  So, I took a more conservative approach.  In 2018, with the new tax overhaul, the "like kind" rule was clarified and will definitely not apply to crypto currencies anymore.

Disclaimer:  I'm only telling you what I did for my taxes, not advising you on yours.  Your situation may differ and you should consult a certified tax preparer for their advice.

[Notmyfault7]

You do not need to worry about this, the service provider will tell you everything about this when it comes to that time.

[iryboy]

I would like to know about EU taxes, is there any guide for it?

[Trofo]

I would like to know about EU taxes, is there any guide for it?

Should be, we have few topics under Croatian local forum so I think there must be something for whole EU as well. There is a EU directive about cypto currencies as well try googling it.

In short, as far as I understand you have to pay taxes the moment you exchange your crypto currencies into fiat. Didn't need more info for now.

[oseikuf44]

I think buying with fiat and selling to fiat is the only point that you will pay tax on. It will be very hard to trace transactions when it get to exchange. What if you report you lost it through trading meanwhile you had stored it in another crypto.

[jij]

I really hope to be like you are saying guys, paying taxes on whatever you cash out. It makes sense.
I can’t think of it having to track and calculate all of your trades...

[Fortify]

It should be quite straight forward, if you made a profit - you would just declare it when you cash out the money to your bank account. There will be a financial trail at that point, so that is how the taxman will find out if you have not declared it properly.