Submitted By: someone
Answered: March 14, 2019 10:27 pm

I put $500 into a cryptocurrency exchange in 2017 and withdrew $1,000 in 2018. How to I report this transaction?

The IRS treats bitcoin and other cryptocurrency transactions as property and not as currency. As such, you must figure gain on the transaction in the same way as with any other type of property. The IRS posted guidance (https://www.irs.gov/pub/irs-drop/n-14-21.pdf) on this matter several years ago, but may revisit the topic, so stay alert.

advertisement
Tax Glossary

Capital asset

Property subject to capital gain or loss treatment. Almost all assets you own are considered capital assets except for certain business assets or works you created.

More terms