Cryptocurrency Taxes - We Know Digital Assets.
Concerns About Your Cryptocurrency Tax Liability?
We offer free Cryptocurrency Tax assessments to help you understand the murky waters of compliance.
The IRS takes Cryptocurrency taxation very seriously. In fact, it is now an “active” IRS Compliance Campaign. And active IRS Campaigns significantly increase your chances for audit.
There are multiple Cryptocurrency reporting obligations to consider:
- IRS Form 1040, page 1, Cryptocurrency disclosure question
- Buying and selling Cryptocurrency on exchanges
- Buying or selling and trading products with Cryptocurrency
- Earning income in Cryptocurrency
- Possible FBAR implications with holding Cryptocurrency on foreign exchanges
- Tracking your cryptocurrency Adjusted Cost Basis
- Tracking the Fair Market Values of Cryptocurrency
- Tax basis when you receive Cryptocurrency as a gift
- Tax basis when you receive Cryptocurrency through an inheritance
It is clear that the IRS treats all Cryptocurrency as “property” for tax purposes. As a result, the buying and selling of Cryptocurrency can result in capital gains and losses. Additionally, earning money in Cryptocurrency is reportable income based on its Fair Market Value at the time of receipt. Exchanging goods with and for Cryptocurrency is also a reportable transaction. And because Cryptocurrency exchanges rarely report third-party transactions (like stock brokerage firms do), this leaves the reporting solely on the shoulders of taxpayers. Reporting multiple transactions and fees across multiple exchanges at multiple times is exhausting at best.
Do not be on the wrong side of cryptocurrency compliance.
Need Guidance or Legal Assistance With Cryptocurrency Tax Filing? Webb & Morton Can Help!
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