If you have only purchased cryptocurrency, you have not had a taxable event yet and just need to be prepared whenever you sell. A benefit of the "hodl" strategy.
You can start with understanding how the IRS treats cryptocurrencies, which can be found here.
Included on that page is a link to the original guidance notice. That notice goes into more depth to include mining and using cryptocurrency for business operations.
So if you have sold/traded cryptocurrencies and have very few cryptocurrency sale/trade transactions and prefer to do your own taxes, you would most likely need to fill out one or more 8949 form(s) to include with your schedule D. For the taxpayer with just a few sell/trades that is familiar with using those forms for their typical stock/bond/security activities, cryptocurrencies are handled the same way with respect to short-term and long-term classifications.
For anyone that has more complex circumstances or would just like to have the peace of mind in having someone else look over how they are filing their taxes, give us a call and we will see how we can help you. A bitcoin CPA is ready to help you with your particular circumstances.
For those unfortunate individuals that have experienced the loss or theft of their cryptocurrencies, depending on the circumstances, those losses can be tax deductible and we can help you with determining that too.
Temko Financial Consulting (813) 906-0330
I am teaching the "Practical Steps to Investing in Bitcoin" at Blockspaces this Friday, July 27 at 6:30 pm. With a second class on Monday, July 30th at 6:30 pm for "Understanding Cryptocurrency Exchanges and Security". Registration for the Friday class is currently open and registration for the Monday class will be open soon.
There will also be a "Learn about Charting and using Tradingview" class that is tentatively scheduled for Friday Aug 3. Once you have all three of those classes, you will be ready for the "Trading Tuesdays" that are scheduled every Tuesday to be able to analyze the current trends of Bitcoin and other Cryptocurrencies and be a better informed Cryptocurrency investor.
There is no requirement to attend the classes in any order or that any is a prerequisite for the next class. If you are comfortable with purchasing cryptocurrency, using exchanges, and securing your coins, but want to understand charting better, go ahead and start with the "Learn about Charting and Tradingview class".
Pricing for each class is $20 for non-members of Blockspaces and $10 for members of Blockspaces.
The basic membership cost is $30/month billed on a month to month basis that you can cancel at any time.
So if you think you would benefit from all the three classes, that would be
3 X $20 = $60 as a non member or
$30 membership + 3 X$10 = $60 for the classes plus the remainder of the month to go to the Trading Tuesday classes and other classes that are normally $10 for non members, but free for members.
If you are interested in the classes, please visit the Blockspaces Event page for more information and for registration.
All of the classes will be recurring, so if you missed one, it will be held again in the very near future.
Looking for guidance with Cryptocurrencies like Bitcoin, Ethereum, Litecoin, Dash, or others?
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