Quote:
Originally Posted by Wayne 962
Cash in crypto, or USD cash? It's my understanding that all of these cryptos are very difficult to convert back into dollars, and then (legally) have to be declared as a capital gain on the tax returns. On this year's return, there is a question as to whether you have invested in crypto over the previous period. That would probably be a big audit flag for the future, I would think?
As I understand it, the reason the NFTs were so popular is because they were paid for in crypto currencies that couldn't easily be converted to US dollars (also without generating a taxable event). It remains to be seen if a purchase in Bitcoin (of an NFT or any tangible object) would be a taxable event.
PayPal sat (and still does) in this grey area for a long time as it is not a bank, but acts like one. I can't recall what PayPal reports to the IRS - distributions (withdrawals?) either...
-Wayne
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It is very easy to convert cash/fiat into crypto and to get right back out, takes just a minute. Works almost identical to my E-Trade account, no different. My account on coinbase is tied to my checking account, same as E-Trade. I can send that crypto to different places, do swaps, earn interest, stake and earn, but it always comes back to my CB account if I want to exit for fiat. Coinbase is my on-ramp, off--ramp.
Regarding taxes, I do not cheat on my taxes and I disclose all gains. There are many crypto services now that will generate a Form 8949. I paid $200.00, dumped my cvs reports from all exchanges I play on, generates the form, give to CPA. Capital gains are no different, either short term or long term. If you make money, your going to pay.
EDIT: I went back and read Wayne's comment and mine, this is why I say we are still in the 1st inning of this crypto deal. You have highly intelligent people that just are not informed outside of an article or headline. I asked a friend the other day if he held any BTC? He literally had no idea what I was talking about. Blew me away. I have developed muti-million dollar companies in multiple states, 7 figure real estate portfolio and will say this, the easiest money I have made is crypto by a long shot, next 4 years will be historic. All you here on media is bitcoin, but there is so much more. This is like being in on Apple or Microsoft early days.
Open an account on Coinbase, takes a couple days to get verified, drop a $100.00 then go play around and see what the fuss is. Very cool stuff.