IRS and Virtual Currencies

The Internal Revenue Service (IRS) sees virtual currencies transactions as taxable income by law, as money or property. American taxpayers, resident aliens and businesses may have to report these transactions as income on their tax returns. Sales or exchanges of virtual currencies, or the usage of virtual currencies to pay for goods or services, or holding virtual currencies as an investment, generally become a tax liability.

Virtual currency is a digital representation of value that functions as an instrument for money exchange; this includes cryptocurrency and bitcoin. Virtual currency equates to a value in an established real currency.

The IRS.gov web-site posts information and webinars on other tax generated income from sales and services. It is a free source. For more information, refer to the listed IRS Publications below.

Published by Mews News

Blogging from the Pacific Northwest

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