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It’s still ambiguous but the most straightforward way is to treat it as miscellaneous income, which is how I reported it.
by kentm 9y ago
It’s still ambiguous but the most straightforward way is to treat it as miscellaneous income, which is how I reported it.
- ryanmarsh 9y agoIf Apple's stock were to split and then "moon" would you claim the difference in portfolio value as misc income? That sounds nonsensical to me. The IRS guidance states it can be treated as a capital asset. You're still HODLing right? Right?
- kentm 9y agoI did the research a few months ago and don’t remember the details, so sorry if this is vague. There are certain criteria that are required for something to be treated as a split and IIRC coin forks were really iffy in this case. The usual case in a stock split is that you get either more of the same security or something of similar likeness (a non voting class of shares in the case of the google split), which is arguable in the case of crypto. You could argue it’s a split to save money and if you had a huge amount in BTC at the time of the split it’d be worthwhile. My tax savings were going to end up being trivial so I went with what was “safe”. Edit: noticed your comment about Apple stock “moon”-big. If we’re reporting the fork as income then it’d be income at the value at the time of the fork. So if you had one BTC then the BCH income would be $277 or so and that would become the cost basis going forward. I didn’t have a lot of BTC so the actual tax cost was very low. If you’re holding thousands of BTC at the time then the story would be different and you’d be incentivized to argue a different tax treatment. Apologies for the wordiness here!!
- kemonocode 9y agoDo you owe taxes on unclaimed coin forks? I'd wager no but considering how complex taxation in general has turned out to be with cryptocurrencies...