<\/p>\n
Tax forms 1040, 1099-MISC, and 1099-B are what most U.S. investors need to fill out. <\/p>\n
There are only two things certain in life \u2013 death and taxes.<\/p>\n
With the kick-off of tax season in the United States, cryptocurrency investors now have to deal with the complex and convoluted task of declaring their holdings.<\/p>\n
Since 2019, the U.S. Internal Revenue Service (IRS) has begun taking a bigger interest in crypto, adding a checkbox on tax form 1040<\/a> for investors to declare whether they have sold, bought, or received a digital asset in the previous year.<\/p>\n \u201cThe IRS is taking crypto tax very seriously,\u201d said Shehan Chandrasekera, also known as CryptoCPA<\/a>, and tax analyst for Forbes. So much so, he told The Defiant, <\/em>that it is the first question to answer after personal information.<\/p>\n According to Chandrasekera, the IRS considers crypto to be \u201cwidening the tax gap,\u201d pushing authorities to clamp down on the industry.<\/p>\n There are a couple of important notes for this tax season: \u201cHodling,\u201d for instance, is completely tax-free. This means that receiving or buying crypto \u2013 and not selling \u2013 does not imply the user should pay the government.<\/p>\n Receiving an NFT<\/a> as a gift, for example, is not taxable unless the receiver sells it.<\/p>\n Chandrasekera posted<\/a> on Twitter the two different forms \u2013 1099-MISC and 1099-B \u2013 that investors are going to encounter, along with encouraging users to download a transaction history report from the platforms they use.<\/p>\n According to Australian financial comparison site Finder<\/a>, as of Nov. 2023, roughly 15% of Americans own crypto, down from 18% in an earlier Apr. 2023 report. This means more than 38M U.S. citizens own a digital asset, all of whom are required by the IRS to report their investments.<\/p>\n However, understanding the tax landscape in the United States can be difficult, both for investors and the government.<\/p>\n <\/p>\n Start for free<\/a><\/div>\n <\/p>\n\n