Quote:
Originally Posted by Fred
And what's a crypto currency supposed to do?
Edited to add a  face. |
Crypto transactions have always been reportable--every time you sell, exchange, or trade virtual currency or use it to pay someone. Until now I've had to rely on screenshots to get the information needed (date, gain or loss). Beginning in 2024 crypto transactions will be reportable the same way stock transactions are: on a 1099-B. There are already services that will produce a 1099-B from your exchange account.
For someone who's been trading in crypto, this change will actually make things easier. But imagine what this will look like for someone who uses Ethereum to buy their Starbucks every day. Right there is 260 reportable transactions. Yikes.
And by the way, unless you can definitely pin your hard wallet or exchange to the US, your crypto will be considered the same as foreign currency. If you have more than $10,000 outside the US at any one time during the year you'll have to file an FBAR (Foreign Bank Account Report, AKA FinCen114) in addition to your tax form. The FBAR doesn't incur any taxation; it's to keep track of money overseas, ostensibly to curb money laundering. But the penalties for not filing are severe--up to 50% of the account balance for every year of non-compliance.
Bad News Bill