6 Ways to Avoid Capital Gains Tax on Your Bitcoin Transactions
How to Legally Avoid Taxable Gains on Cryptocurrency
In 2018, its possible for individuals to gift up to $15,000 without documenting the transaction.
If the amount is above $15,000 then a gift tax return would need to be filled (the annual gifting exclusion limit is $15,000 per individual).
Did you know that US citizens can gift up to $11.2 million per lifetime?
One last point on Gifting — when the recipient cashes out (sells the crypto), the taxable value of the gift is determined by the market value on the day the gifting took place.
It’s been a bumper year for Bitcoin from a peak price of over $19,000 to a subsequent low of less than $6,000 dollars.
Warning check to see if this information is up to date in 2022 where you live!
Remember Bitcoin is a commodity – everything else is a cryptocurrency.
In 2014, the Internal Revenue Service (IRS) issued guidance for US taxpayers regarding the treatment of cryptocurrency — Cryptocurrencies are to be treated as a capital asset. This capital gains rules apply for any gain or loss, creating a taxable event for potentially every cryptocurrency transaction.
The IRS served a “John Doe” summons (the worst kind) to Coinbase for it’s customer list of investors who have transaction worth more than $20,000 back in 2015.