How Do I Pay Taxes On Crypto?

How are cryptocurrencies taxed?

I keep hearing about taxes on cryptocurrency, what’s the deal? Is there one thing to pay or are they all different? I thought it was one tax rate for everything. Actually, no, it’s not. There are now three main categories of taxation with cryptocurrency: capital gains taxes, due diligence requirements, and self-reporting requirements. Here’s how you can avoid them completely if that is what you desire.

Capital Gains Taxation– Capital gains refer to selling a property for more than your cost basis in it– i.e., you sold an asset for more than you paid for it minus the amount of time value lost by waiting for the sale to happen. It does not include any costs associated with creating or maintaining the asset through work done until the sale occurs including fees paid to mining pools at their expected fair market value.[Top] For example, consider purchasing your first bitcoin (BTC) for $240 USD back in 2015; should you sell today (April 2018), this would be valued at $7351; assuming 0% capital gains tax rates (the current rate is 20%), these assets would be subject to your income tax bill as well as profit/loss calculations should investments like real estate holdings enter into play.[Bottom] If however you had purchased 1 BTC back in 2015 but never cashed out nor withdrew out of over 15 years; this piece of paper would provide too much data required by