2021 was all about the crypto markets and NFTs. But, what does all of that mean when it comes to how crypto will impact 2021 tax returns? Whether buying, selling, trading, swapping, converting, exchanging, etc. you need to understand how crypto affects your taxes and what information you need to provide to your accountant.
Here are some things that YOU need to do
Track EVERY transaction that you make with Crypto, NFTs, etc.
Report EVERY transaction that you make with Crypto, NFTs, etc.
Understand WHAT is a taxable transaction
Understand WHAT isn’t a taxable transaction
Use a professional to prepare your taxes that understands Crypto, NFTs, etc.
Educate yourself BEFORE investing
What is a Taxable Transaction?
Selling Crypto or an NFT and receiving fiat currency
Selling Crypto or an NFT and receiving crypto or an NFT
Buying an NFT with crypto
Swapping from one Crypto to another
If you use terms like Convert, Trade, Exchange, Burn, etc. it is likely a taxable transaction
What isn't a Taxable Transaction?
Transferring Crypto or an NFT from one wallet that you own to another wallet you own
Buying crypto with fiat currency
Educate yourself, Educate yourself, Educate yourself
Here is a great resource from Work From Home Financial to track all of your crypto transactions in one easy place!
If you said “I'd like to hire a Strategic CFO in 2022” it is time to book a consultation with CFOAdam!
Regardless of your current size, Adam Kae & Associates can guide you every step of the way. The best way to avoid costly financial mistakes is to prevent them from happening in the first place, and that’s what a CFO is for!
Facebook: Adam Kae & Associates
LinkedIn: Adam Kae & Associates
Disclaimer: This article contains information and opinions from Adam Kae & Associates, and the information and opinions should not necessarily be seen as the best possible solutions for your business. Please contact us at firstname.lastname@example.org to help you find the best solutions for your business.