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US Tax Service Explains When It Is Not Necessary To Report Bitcoin In The Declaration


US residents do not need to report the purchase of cryptocurrency on the first page of the Form 1040 declaration if they adhere to the strategy Buy & Hold… This follows from the information on the updated Frequently Asked Questions page of the IRS website.

Last year, the IRS submitted a draft declaration, where the question to the taxpayer was posed in the following format:

“During 2020, did you receive, sell, send, exchange or otherwise obtain a material interest in any of the virtual currencies?”.

Then many market experts criticized the new rules.

“Asking the IRS to declare all cryptoassets is just as inappropriate as asking for all email addresses, social media accounts or service plans,” wrote Justin Wales, co-chairman of Blockchain and Digital Currency Practice.

Some tax management specialists expressed the opinion that these rules need further clarification.

Only at the beginning of 2021, the department explained that a simple purchase with the subsequent storage of virtual currency does not require reflection in the declaration.

Data: IRS website.

According to the IRS, a taxable event occurs when a crypto asset is sold.

“When you sell virtual currency, you need to determine the capital gain or loss from the operation,” says the IRS website.

Earlier, ForkLog reported that the Internal Revenue Service of the United States sent letters to cryptocurrency holders demanding to pay off large debts to the state.

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Fidenge Pecold

My profession is a journalist, but my hobby for 8 years has been studying Forex investing and trading. During this time, I managed to gain extensive experience in investing and trading cryptocurrencies and double my capital in the Forex market. To be the author of this magazine, the site owners invited me to participate in one of the 2020 trading webinars, and I will try to reveal the most relevant crypto market news for you.

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