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Author: Admin | 2025-04-28
Of accounting is more straightforward and, in most cases, avoids the concept of impairment.You can split your crypto transactions into two general camps based on the type of cryptocurrency tax they generate: those that generate income taxes and those that generate capital gains taxes.What crypto transactions are taxable events under GAAP and IFRS? The following activities constitute a taxable event and will cause your business to owe income taxes on the fair market value of the asset they generate on the date of receipt:Mining incomeCrypto stakingHard forks or AirDropsInterest earningsYou should include all of these activities in your gross revenue for the year; they will be taxable as ordinary business income. Of course, you’ll be able to deduct all ordinary and necessary expenses incurred as a result of these activities as well.The list of events that trigger capital gains or losses is much shorter since it can be summarized as any disposal of your cryptocurrency for proceeds that are different from the cost basis including: selling it, exchanging it, or using it to pay a vendor.What crypto transactions are non-taxable events?Other than the events listed above, your cryptocurrency transactions should be non-taxable. None of the following will contribute to tax liability of your business:Buying crypto with fiat currencyGifting or donating cryptoTransferring like-for-like crypto assets between exchangesHow Taxbit Can HelpThis article briefly highlights some primary accounting considerations, but it quickly becomes clear that the accounting and tax repercussions for your crypto transactions are a lot of work.Due to the complexity, volume,
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