BDO USA has published an article, “Confused About Crypto? Tax Considerations for Investing in Cryptocurrency”, published on BDO USA. The abstract is as follows:
The prevalence of cryptocurrency—or what the Internal Revenue Service (IRS) refers to as “virtual currency”— in investing and financial transactions has increased significantly in recent years. While the IRS and other government agencies have been clear about their focus on the future oversight of these transactions, taxpayers continue to lack clear guidance in evolving areas of the industry.
This article discusses U.S. federal tax consequences for businesses and individuals that hold or transact in virtual currency, including for U.S. investors in foreign companies that engage in these transactions, as well as newly proposed U.S. information reporting requirements. Taxpayers should consider their cryptocurrency transactions when planning for their 2021 tax liabilities and reporting compliance.
Posted by Marin Larkin, Associate Editor, Wealth Strategies Journal.