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21788979 No.21788979 [Reply] [Original]

How do taxes on crypto for americans actually work? These memes got me worried. For swing trading, are you paying taxes on profits only or do you have to pay on your entire volume of trading?

If so then I'm absolutely fucked

>> No.21789801

Use something like tokentax. Gotta pay every time you cash out or exchange cryptos.

>> No.21789860
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21789860

>or do you have to pay on your entire volume of trading?

>> No.21789869

>>21788979
It’s just then profits but if you use other then coinbase or large exchange you will need to document this yourself. The big exchanges do this for you and send you a document. Wallets do not. If you’re mostly in ERC20 tokens then you can put your wallet address into etherscan and grab the data from there

>> No.21789885

>>21788979
swing traders get the rope isn't a meme they hang themselves because they owe more in taxes than they ever can even cash out.

>> No.21789934

>>21788979
Profit only bro, but they want to take into account every profit made, each time you traded between coins.

Honestly if its a total mess, just declare the overall profit when you cashed out, pay taxes on it and nobody gives a shit unless you made a very large sum like in the 6 or 7 figs

>> No.21789965

Every trade is considered a taxable event.

>> No.21789978
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21789978

>>21788979
If they ever come after me I’ll say I didn’t I Know I had to pay taxes on Memes.

>> No.21790033

kk thanks bros

>> No.21790051

>>21788979
You pay taxes on the gains only, but you have to do it on every single trade.
Ex. Start with $5k. Buy BTC at $5k, sell at $10k, buy ETH at $200, sell at $300, buy Link at $10 and sell @$15 would look like this:
Assume 25% tax rate but is actually your income tax rate
Sell BTC - profit $5k, taxable amount of $5k x 25% = $1250
Sell ETH - profit $5k, taxable amount of $5k x 25% = $1250
Sell LINK - profit $7.5k, taxable amount of $7500 x 25% = $1875
Total tax bill on your $17.5k profit is $4375
But remember all those quick transactions in and out of Tether, ETH, BNB to facilitate the trade? All taxable.
Hope you kept good records.

>> No.21790649

>>21788979
just don't pay them.
they'll send you a letter letting you know how much you owe.