New IRS Amendments in the Field of Virtual Currency

Updated: Dec 3, 2021

Previously, Investors had to pay capital gains taxes on crypto-currency transactions when exchanging them for traditional money. However, under the new law on Tax Reform, all transactions regarding crypto-currencies will be taxed starting January 1, 2018.

The new amendments require Investors to pay tax on any crypto currency transactions: when exchanging one crypto currency for another, if the crypto-currency was held for less than a year the investor will pay income tax from 10% to 37% on any gains, and if the currency was held for more than a year, they will be charged Capital Gains Taxes up to 24%.

Also included under the new law are regulations for companies providing crypto-currency services. The Companies providing currency exchange services to investors will be required to provide its customers with a Form 1099 detailing the transaction and reporting it to the IRS.

Investors in crypto-currencies found violating the new tax law will be fined by the IRS. In order to avoid fines, please make yourself familiar with the new tax law reform if you plan on investing in crypto-currencies. Remember, you must always comply with the US tax laws and keep detailed accounting reports of your investment operations.

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