Results 1 to 6 of 6

Thread: Tax Implications when Buying and Selling Cryptos

  1. Default Tax Implications when Buying and Selling Cryptos

    I have done very little trading in my lifetime, but when I have I was utilizing Scottrade or Etrade or some other US-based company to buy and sell. These companies would provide the required tax forms to show any gains or losses (mostly losses) for tax reporting. I am now dabbling in the Crypto frenzy, and I have a couple of questions about how/if to report this activity.

    1) While using Turbo Tax today, there was a question regarding whether I not I had foreign accounts. I have bought BTC with Coinbase, transferred to GDAX, then to Binance to trade for XRP and LEND (based on other members recommendations). I also have small BTC and ETH mining accounts via Hashflare. I think some of these companies are based overseas. All my buying and trading activity was after Jan 1, 2018. I have not yet sold back to USD. What and when do I need to report this activity to the IRS?

    2) Will these exchanges report activity to the IRS and provide the requisite tax forms to me? I'm pretty sure know they asked for SSN during account activation.

    3) How would any gains or losses in trading from USD-to-crypto and crypto-to-crypto be treated by the IRS? Again, I am a novice at investing, so I have relied on Scottrade and Turbo Tax to properly report in the past.

    Thanks


  2.  
  3. #2

    Join Date
    Jul 2016
    Location
    Texas
    Posts
    2,053

    Default Re: Tax Implications when Buying and Selling Cryptos

    Good question...I haven't a clue but I think the point of the question is whether on not you have a bank account or other financial account with signature authority, that you control, in another country--I doubt they ever considered crypto currency when reporting requirements were implemented. Usually the threshold for filing any type of form with your taxes is above $10K. See https://www.irs.gov/businesses/small...-accounts-fbar Since you didn't start trading until this year, I think you would answer no for Tax Year 2017 but suggest you talk to tax lawyer or accountant to verify or ask TurboTax your question.

  4.  
  5. #3

    Join Date
    Jan 2014
    Posts
    7,885
    Blog Entries
    10

    Default Re: Tax Implications when Buying and Selling Cryptos

    Is Bitcoin or a Bitcoin Wallet Reportable for Purposes of FBAR, FATCA?
    https://klasing-associates.com/bitco...es-fbar-fatca/

    IS BITCOIN SUBJECT TO FBAR & FATCA REPORTING?
    https://www.freemantaxlaw.com/blog/i...atca-reporting

    Bitcoin Users Brace For IRS Audits From Coinbase Summons
    https://www.forbes.com/sites/robertw.../#669f81021c77

    IRS Attack Dog Will Target US Bitcoiners and Soon…
    https://news.bitcoin.com/irs-attack-...us-bitcoiners/

    Quote Originally Posted by drbama View Post
    I have done very little trading in my lifetime, but when I have I was utilizing Scottrade or Etrade or some other US-based company to buy and sell. These companies would provide the required tax forms to show any gains or losses (mostly losses) for tax reporting. I am now dabbling in the Crypto frenzy, and I have a couple of questions about how/if to report this activity.

    1) While using Turbo Tax today, there was a question regarding whether I not I had foreign accounts. I have bought BTC with Coinbase, transferred to GDAX, then to Binance to trade for XRP and LEND (based on other members recommendations). I also have small BTC and ETH mining accounts via Hashflare. I think some of these companies are based overseas. All my buying and trading activity was after Jan 1, 2018. I have not yet sold back to USD. What and when do I need to report this activity to the IRS?

    2) Will these exchanges report activity to the IRS and provide the requisite tax forms to me? I'm pretty sure know they asked for SSN during account activation.

    3) How would any gains or losses in trading from USD-to-crypto and crypto-to-crypto be treated by the IRS? Again, I am a novice at investing, so I have relied on Scottrade and Turbo Tax to properly report in the past.

    Thanks
    "In the land of idiots, the moron is King."--Unknown

  6.  
  7. #4

    Join Date
    Jan 2014
    Posts
    7,885
    Blog Entries
    10

    Default Re: Tax Implications when Buying and Selling Cryptos

    Quote Originally Posted by evilanne View Post
    ... Usually the threshold for filing any type of form with your taxes is above $10K. See https://www.irs.gov/businesses/small...-accounts-fbar Since you didn't start trading until this year, I think you would answer no for Tax Year 2017 but suggest you talk to tax lawyer or accountant to verify or ask TurboTax your question.
    reporting foreign bank account of less than 10000 dollars
    https://ttlc.intuit.com/questions/31...-10000-dollars

    "Yes, there is reporting requirement for foreign accounts even if the balance at any time during the year was less than $10,000. ..."
    "In the land of idiots, the moron is King."--Unknown

  8.  
  9. #5

    Join Date
    Jul 2016
    Location
    Texas
    Posts
    2,053

    Default Re: Tax Implications when Buying and Selling Cryptos

    Quote Originally Posted by evilanne View Post
    Good question...I haven't a clue but I think the point of the question is whether on not you have a bank account or other financial account with signature authority, that you control, in another country--I doubt they ever considered crypto currency when reporting requirements were implemented. Usually the threshold for filing any type of form with your taxes is above $10K. See https://www.irs.gov/businesses/small...-accounts-fbar Since you didn't start trading until this year, I think you would answer no for Tax Year 2017 but suggest you talk to tax lawyer or accountant to verify or ask TurboTax your question.
    Quote Originally Posted by userque View Post
    reporting foreign bank account of less than 10000 dollars
    https://ttlc.intuit.com/questions/31...-10000-dollars

    "Yes, there is reporting requirement for foreign accounts even if the balance at any time during the year was less than $10,000. ..."
    drbama stated "All my buying and trading activity was after Jan 1, 2018" therefore, in doing taxes for 2017 the answer should be no but if in doubt check with a Tax lawyer or accountant.

    see also https://www.irs.gov/newsroom/irs-vir...rency-guidance
    Last edited by evilanne; 01-21-2018 at 10:22 PM.

  10.  
  11. #6

    Join Date
    Jan 2014
    Posts
    7,885
    Blog Entries
    10

    Default Re: Tax Implications when Buying and Selling Cryptos

    Quote Originally Posted by evilanne View Post
    drbama stated "All my buying and trading activity was after Jan 1, 2018" therefore, in doing taxes for 2017 the answer should be no but if in doubt check with a Tax lawyer or accountant.

    see also https://www.irs.gov/newsroom/irs-vir...rency-guidance
    My post refers to owning the account; whether it was traded or not. If the account was owned in 2017, even if it wasn't traded, even if it had less than $10k; Uncle Sam may still want to know about it. That was the takeaway to the OP and other crypto traders here.

    The OP is not clear as to whether he owned the account in 2017; so it wise that the OP should understand what I posted.
    "In the land of idiots, the moron is King."--Unknown

  12.  

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
SPY (C Fund) (delayed)
Tax Implications when Buying and Selling Cryptos
(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)
Tax Implications when Buying and Selling Cryptos
(Stockcharts.com Real-time)
EFA (I Fund) (delayed)
Tax Implications when Buying and Selling Cryptos
(Stockcharts.com Real-time)
BND (F Fund) (delayed)
Tax Implications when Buying and Selling Cryptos
(Stockcharts.com Real-time)

Yahoo Finance Realtime TSP Fund Tracking Index Quotes