January 06th, 2018
Bitcoins and tax law... just spending them could trigger a taxable gain.
For example if you bought a bitcoin for $1 in 2010 and used it today to purchase $9k of jewelry, you would have a taxable gain of $8,999. There is no currently no paperwork or 1099 forms that you would receive at year end. But the IRS expects you to voluntarily report this gain on your tax return.
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David S. Baboian, CPA