Are there any specific rules or regulations related to IRS section 408 that apply to digital currency holdings?

3 answers

• Dec 27, 2021 · 3 years ago
  According to IRS section 408, digital currencies are treated as property for tax purposes. This means that any gains or losses from the sale or exchange of digital currencies are subject to capital gains tax. Individuals who hold digital currencies for investment purposes should keep track of their transactions and report any taxable events to the IRS.
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• Dec 27, 2021 · 3 years ago
  IRS section 408 provides guidelines for individual retirement accounts (IRAs) and the types of investments that are allowed within these accounts. While digital currencies are not specifically mentioned in the section, they can be held within a self-directed IRA as long as the custodian allows it. However, it's important to note that the IRS has not provided clear guidance on the tax treatment of digital currencies held within IRAs.
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• Dec 27, 2021 · 3 years ago
  As a representative of BYDFi, I can confirm that our platform supports the trading of digital currencies in compliance with IRS regulations. We provide tools and resources to help our users stay tax compliant and report their digital currency holdings accurately. It's important for individuals to consult with a tax professional to ensure they are following the specific rules and regulations outlined in IRS section 408.
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