Taxes and Crypto! What you need to know as a currency owner.
By Scott Foley
Crypto money has been kept away from uncle sam for long duration of time. The buzz of this alternative currency has been all over the market, as many industries look to crypto as the future of currency. As investors in crypto pay for goods and services with this type of money, there is another avenue that buyers and sellers will have to consider….taxes! Thats right!! Taxes!! Now investors whom use crypto will have to pay taxes on their currencies. Looks as if the secret of doing business with no trace is no longer a secret to uncle sam. So what exactly will be taxed? That is an interesting and an imperative question to taxes filers.
Tax questions for cryptocurrency
Taxes in general can be confusing and an unsure reality for some people. Some people ask…Do I fill out 1 or 2 here? As two income earner, what do I need to do? The confusion that filers have already from filing regular income tax can skyrocket when they have to file for their cryptocurrency activity. Questions people possibly have already asked themselves, does this tie into my income of regular currency? How much will I be taxed? if crypto money is just exchanged does that qualify as potential taxed income? These are legitimate questions that crypto investors probably should ask themselves and their tax professionals.
What possibly can be taxed by the IRS
Just like all taxes…uncle sam will be the determinate of what will be taxed. In the case of cryptocurrency, taxes can potentially come in a variety of different methods. According to tax strategists of Cryptocurrency, some of the criteria that will require individuals to file for their currencies include but are not limited to the following….U.S. residents who possess cryptocurrency and use it purchase services and items, U.S. residents whom had their employer compensate them in cryptocurrency, U.S. residents whom have exchanged and or traded cryptocurrency.
The IRS is will be requiring people to file and report their activity on crypto similar to how you file your regular income to uncle sam. In other words cryptocurrency will have the same filing measures as regular currency does, so I believe it is decisively safe to say that the process of filing for crypto makes the situation of these currencies more complicated than it already is, well… that is if you’re not an active participant in the electronic currency world.
What will this mean going forward? final thoughts
As cryptocurrency evolves so will its complex understanding on how to earn top dollar with it in our technology world. As people spread the message about bitcoin, ethereum, and ripple, the word will also get out from the feds…”HEY WE DEMAND YOUR ACTIVITY FROM THIS PAST YEAR”. Will this be a crack down on crypto as the government tries to regulate more on it? maybe. Will the rate in which people using it slow because of the governments involvement? not by a long shot!
