The cryptocurrency market continues to rise in popularity in the U.S. and throughout the world. The decentralized finance ("Defi") sector has seen massive growth. Additionally, ease of access has increased as new and established companies offer crypto services and exchanges. As more and more individuals and institutions adopt cryptocurrency, it becomes more important for people to understand the tax laws and regulations governing the cryptocurrency industry. It is important to note that each country views and regulates virtual currency differently. The scope of this article covers the crypto tax laws in the United States. T he IRS defines virtual currencies as digital representations of value that function as mediums of exchange, units of account, and/or stores of value. Further, t he U.S. views crypto as property subject to capital gains and losses for US federal tax purposes. Based on its designation as property, i n general, there are four taxable events when d...
Tax topics made simple. Textbook Tax aims to educate readers about a broad range of tax-specific topics and issues. The goal being to explain tax in an easy to learn format for both educational and real-life application.