It's been said that since 2018, taxing the earnings an investor made in online trading is already a MUST. It is because the IRS has considered cryptocurrencies as asset or property that gives back an income to the owner or holder. This latest news is an added work and complication for investors and traders. For one, it would be difficult to track down how much you have earned with the multiple times you traded, but with the cointracking.info, a crypto tracker which lets you view your history on trading you can now pay tax with ease and comfort.
With so many opportunities presented with the coming of the crypto currencies and trading such as in minding, buying, exchanging, air dropping and more, it is only just and fair that the states will collect taxes for it. Without a further debate on this matter, we all confirmed that this past year had been the IRS landmark when it comes to collecting taxes from crypto trading gain and tax office always appreciates those who pay their tax on their own than if one is caught. Surely, there will be imposed fines and penalties for those who avoid paying taxes with their gains. Sometimes, even if the investor or trader wanted to pay the tax due, it is difficult to calculate it but with cointracker.info that reports you with your online crypto transaction, you can always file and pay your taxes correctly. This application can be available at https://smartoptions.io/cointracking-info-crypto-portfolio-tracker/
Notes To All Crypto Traders And Investor
The best advice we can give when you looking forward to investing in crypto currencies and those who are already in trading are to buy and hold it for some years. This will allow you to earn more if you are looking forward in a long-term basis but do not forget the risk associated with the crypto currencies. These virtual currencies though considered as property with the IRS his very sensitive and volatile, which means it could rise and fall its prices so don't put all your eggs in one basket. Another thing is that always pay taxes from whatever gains you earned. It is never good to pay hefty fines when caught by authorities.
Crypto Currencies Transaction That Is Taxable
1. Receiving Payments
Like any products and services, the payment in crypto currencies is considered as an income with a market value. You have to pay tax when you received payments from crypto currencies.
When you buy 100 dollar worth of coin, there is a taxable gain associated with it and this will depend on how much time you shall be holding the currency.
There are too many crypto currencies nowadays that have greater value. For example, we have bit coins. If you convert bit coins to US dollars at a gain, this is a taxable event because it is considered sold.
4. Air Dropping
Another crypto currency transaction that is also considered as ordinary income of the trader or investor is air dropping. Its value on the airdrop is the basis because once it is sold; the trader will get gain from it.
5. Crypto Mining
We also had another crypto activity that we called "crypto mining." This is another income that but the initial coin fund is not treated with tax. Just like in business, when you enable to raise gain from the capital, you need to pay taxes.