How Taxes are Going to Work With Cryptocurrency

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cryptocurrency taxes

Bitcoin has been at the top of the charts in terms of news and publicity for quite some time now. With the height of the cryptocurrency industry happening in the current moment, it seems like the only place we can go from here is up. One of the main things that could potentially impede how well the system is working is the amount of regulatory measures that the government is attempting to put in place. 2018 is scheduled to be a landmark year for the taxation of cryptocurrencies as many regulatory bodies have been struggling to put some sort of regulation in place.

A new report has come out showing how the cryptocurrency world could change based on this new information in the coming year. The report states that “With only several hundred people reporting their crypto gains each year since bitcoin’s launch, the IRS suspects that many crypto users have been evading taxes by not reporting crypto transactions on their tax returns.” The IRS has not given much information in terms of how they will tax any of the cryptocurrency holdings by individuals or the gains that they have made. According to the report “Although both the public and the crypto community refer to bitcoin and altcoins as virtual currencies, the IRS treats them as property for tax purposes.

Therefore, selling, spending and even exchanging crypto for other tokens all likely have capital gain implications. Likewise, receiving it as compensation or by other means will be ordinary income.” While bitcoin is receiving the majority of the attention in the space, it seems that the industry on other currencies in the space is continuing to grow at an alarming rate. The market on alt-coins as they are called could potentially become the next big industry to be taxed.

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