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How are changes in the value of "traditional", state-backed currency taxed? If I, say, bought 1 Euro for $0.80 in 2000, and sold it for $1.60 in 2008 (prices fr
by zck 13y ago
How are changes in the value of "traditional", state-backed currency taxed? If I, say, bought 1 Euro for $0.80 in 2000, and sold it for $1.60 in 2008 (prices from https://www.ecb.europa.eu/stats/exchange/eurofxref/html/eurofxref-graph-usd.en.html https://www.ecb.europa.eu/stats/exchange/eurofxref/html/euro...), am I taxed on the difference?
Or do currency speculators and day-traders get off tax-free? That seems odd.
- twoodfin 13y agohttp://www.fxop.com/Forex%20Taxation.html http://www.fxop.com/Forex%20Taxation.html That makes my head hurt, but it sounds like if you hold actual currency and realize gains, those gains are treated as ordinary income (top rate 39.6%), but if you instead trade in qualified currency futures contracts, gains are taxed according to a split formula which pulls the top rate closer to the long term cap gains rate of 15%.