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You are right. When you trade crypto->crypto, the IRS views it as if you traded crypto->USD then USD->crypto.
by somebodythere 4y ago
You are right. When you trade crypto->crypto, the IRS views it as if you traded crypto->USD then USD->crypto.
- uwuemu 4y agoso when you buy 1 btc for $30k, trade the btc for 100 of bscoin, bscoin rises to 50 bscoin pet 1 btc, you change back to btc, now you have 2 btc, but the next day big crash occurs and 1 btc is worth just 10k... you cash out and there you have it, a $10k loss... but, you're supposed to pay the tax man on the bscoin -> btc trade? That makes no sense. And then what, you'll want that tax back because of the loss? More BS paperwork for no reason? And all this for what?
- somebodythere 4y agoThat's correct, but under US tax law, in certain cases you are able to realize the loss on the BTC to offset the gains you made earlier (tax-loss harvesting)
- giaour 4y agoThis is also what happens when you buy and sell stocks or bonds, FWIW. Each sale is a taxable event, even if you receive payment in the form of a different stock or bond.