Tuesday May 24, 2022 – Have you noticed – Cryptocurrency is volatile? Back in 2014 the IRS announced that crypto is property for tax purposes. Not currency, not securities, but property. So, some tax rules that apply to currency or securities do not apply to cryptocurrency.
Rules like the Wash Sale Rule. You can sell your crypto and buy it right back without a 30 day waiting period. Each trade is a taxable event.
The IRS is still inventing the rules for Cryptocurrency. The IRS believes that as much as 10% of the Tax Gap (the difference between how much the IRS collects and how much the IRS should collect), or more than $50 billion, is the result of crypto traders avoiding reporting.
Attorney Steven A. Leahy reports on Cryptocurrency and the IRS on Today’s Tax Talk.