Helping You Understand Tax Obligations Resulting From Cryptocurrency Acquisition
In recent years, there has been an exponential rise in individuals and businesses obtaining cryptocurrency for investment and personal asset purposes. This digital currency was once held onto but is becoming more widely accepted as legal tender to purchase services and goods. While this seems like an easy, more modern way to conduct transactions, there are tax implications and other issues that arise from the acquisition and use of cryptocurrency.
If you have invested in cryptocurrency and have questions about how this currency is taxed, turn to the Law Offices of Robert T. Leonard, APC. With offices in Woodland Hills and Los Angeles, our firm provides comprehensive cryptocurrency tax and other tax-related representation to clients throughout California. Firm founder Robert T. Leonard is not only a lawyer but also a certified public accountant (CPA). This additional knowledge renders him an exceptional ally in your pursuit of understanding and settling tax liabilities stemming from cryptocurrency purchases.
What Is Cryptocurrency?
Also referred to as “crypto,” cryptocurrency is a type of digital or virtual currency that is used to purchase items and services, just as standard money is. However, crypto is unregulated and is often used to secure online transactions. There are many types of cryptocurrency, including Bitcoin, Dogecoin, Litecoin, Ethereum and several others.
Taxation Of Cryptocurrency
As the use of cryptocurrency is legal, digital currency is still in its infancy, most people do not understand how it is taxed. As it is considered legal tender, it is also subject to state and federal tax laws. Whether you are using Bitcoin or another type of virtual currency, it will be treated as property per the Internal Revenue Service (IRS). Having a knowledgeable tax attorney help you understand what the tax implications are is important, as failure to report your cryptocurrency gains on your tax return can lead to serious issues with the IRS.
Schedule A Consultation Today
To learn more about cryptocurrency tax issues or to discuss your specific situation, call our office at toll-free at 888-408-9486 or locally at 818-224-7935. You can also reach us online. We offer a free, confidential consultation.