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RE: ADSactly On ADSACTLY - Part #38 - Taxation of Crypto - Part #1
You have a great point regarding tax on crypto. Here in the US you do have to pay taxes on crypto the same way you pay taxes on property. That being said, the best way to minimize is to buy and hold for more than a year. Short-term capital gains are taxed at your normal ordinary income tax rate while long-term gains are taxed at a reduced rate Of course, given the volatility, it still might be in your best interest to lock in the profit now and take the tax hit, but that is up to you to decide. However You don’t pay any taxes if you hold yourcrypto regardless your profits.
While I agree taxing it as property is extremely difficult to calculate (on both sides), I see where they are coming from. If you only tax crypto when it's converted to fiat, all of the purchase paid for in crypto will go untaxed. I'm not defending it, I'm just saying I understand their POV.
We will comment the "property" insanity in the next post. Thank you!
That’s gona be very interesting!
The only way to tax crypto that makes any sense is to tax any capital gains when your sell them for fiat. In Finland, Steem rewards are taxed as income tax because they are rewards for work. And they are taxed only when you exchange them into euros. I don't know whether you need to take fluctuations of STEEM and SBD value into account.
Working out how much you owe in taxes is a bitch. Maybe we should just move to a crypto tax haven after retirement and cash out only then...
I agree! That’s one of the main reasons I buy crypto and hold it long therm. I invested only what I’m prepared to loose. This way I avoid potential stress due to volatility.