All Things Tax

All Things Tax

Like the title says, from the filing process and tax questions to tax policy and reform, you can search and share All Things Tax here. This is the place to find answers to all your general questions that don't fall under the other categories. And just a reminder: questions about software or online filing should be posted in DIY Products.

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Pioneer
Posts: 1
Registered: ‎12-22-2017

Cryptocurrency taxes

How are cryptocurrencies taxed? So I only pay taxes on my profits when I cash out for money or is each transfer of a coin to another coin a taxable event? Will the new tax law affect this? What kind of tax rate should I expect? If I have my taxes done at h and r, are they capable of dealing with cryptocurrency?
Tax Pro
Posts: 6,070
Registered: ‎02-23-2016

Re: Cryptocurrency taxes

Hi Taj1989,

 

 

Cryptocurrency is an investment instrument just like a stock or a bond or anything else that you invest in to earn a gain from.  Your gains are what is taxable.  Even of you spend some of your gain on more bitcoins or trade gain for more coins you still have to pay tax on the gain.  The income is reported on Form 8949/Schedule D just like gain from other types of investment instruments.  Yes, H&R Block can do that, or you can do it yourself with the online software if you would like (you'll need at least the Deluxe version).

 

 

If you have any other questions I'll be glad to help.

 

Louis,

Senior Tax Advisor (Tampa, FL)

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Pioneer
Posts: 2
Registered: ‎01-10-2018

Re: Cryptocurrency taxes

Didn't know where to go so I thought I would try here hope this is ok. I have a lot of friends who have just heard about Cryptocurrency and they want to get in but it's taking a while for them to get verified or are having trouble getting verified so they want to know if I can buy the currency for them and send it to a hardwallet for them till they get verified. My question is do I have to pay taxes on what I purchase for them and send to there wallet? So say "John" wants me to buy $100 worth of Bitcoin and I buy it for him on my account and then send it to his wallet. I no longer have that bitcoin but it was purchased under my account. How is that tracked as far as taxes go?