the crypto you

 YOU WOULD WISH YOU READ THIS ARTICLE. VERY IMPORTANT!!!!

In this article, I will give you detailed guidance on what to do. PLEASE READ THOROUGHLY . Did you buy, sell, use, or trade crypto? If so, you may owe taxes if you’re a US taxpayer. Here’s a look at what that could mean, the steps you may have to take, forms you’ll need, and how gains and losses may affect your taxes.

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Determine if you owe crypto taxes

Even if you’re in the “Just HODL it” camp, it’s worth evaluating your crypto transactions to determine if you may owe taxes.

What's taxable

In short, a lot. Here are some examples of taxable crypto events:

Taxable as capital gains

  • Selling crypto for cash
  • Converting one crypto to another
  • Spending crypto on goods and services

Taxable as income

  • Getting paid in crypto
  • Getting crypto in exchange for goods or services
  • Mining crypto
  • Earning staking rewards
  • Earning other income
  • Getting crypto from a hard fork
  • Getting an airdrop
  • Receiving other incentives or rewards

What's not taxable

Some non-taxable events include:

Not taxable

  • Buying crypto with cash and holding it
  • Donating crypto to a qualified tax-exempt charity or non-profit
  • Receiving a gift
  • Giving a gift
  • Transferring crypto to yourself

Conclusion:

If you’re holding crypto, there’s no immediate gain or loss, so the crypto is not taxed. Tax is only incurred when you sell the asset, and you subsequently receive either cash or units of another cryptocurrency: At this point, you have “realized” the gains, and you have a taxable event. For more information on the below listed, feel free to reach out to me either through DM or comment below.

  1. Calculate gains and losses
  2. Consult a tax professional
  3. Prepare your forms
  4. File your taxes
  5. Invest, Hodl crypto during gains and losses

How to avoid getting taxed on crypto

  1. Buy crypto in an IRA.
  2. Declare your crypto as income.
  3. Hold onto your crypto for the long term.
  4. Offset crypto gains with losses.
  5. Sell assets during a low-income year.
  6. Donate to charity.

COMPOUNDING INTERESTS

Here’s a super simple example of compound interest:

  • You invest $30
  • Daily your $30 earns $3 in interest, now you have $33 sitting in your account.
  • When you decide to re-invest your $33, you earns you $3.3 in interest. You now have $36.3 without ever putting any extra money in your account.
  • When you invest your $36.3 earns $3.63 in interest. You now have a total of $39.93
  • This cycle keeps repeating itself as long as you’re investments do well.
  • Remember a higher capital results in an increased profit earning.

Compound interest is what happens when your interest starts earning interest. REMEMBER YOU CANNOT BE TAXED ON INTEREST. This is why are-Investment is advised.

the crypto you

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