Ted Bauman, has made major contributions in the investment sectors by helping many make the right investment decision. At the beginning of this year, he expanded operation to offer help to virtual currency investors. Cryptocurrencies become popular last year in December when bitcoin price rose to the $20,000 mark. Many people become millionaires overnight due to the rise in prices. However, this didn’t last for long as the prices dropped drastically in January 2018. Before the rise in bitcoin prices, many did not understand the tax obligations on their parts when it came to cryptocurrencies.
People had ventured into cryptocurrencies with the notion that governments will not have any control over their transactions. Despite the decentralized nature of blockchain and its technology, governments have taken upon themselves to put various measures to regulate its operation. This includes taxing cryptocurrencies. Since the IRS started taxing cryptocurrency, many investors have not filed their returns, as many do not understand how to go about filling it. Because Ted Bauman is always ready to lend a helping hand, he offered a few tips on cryptocurrency taxation to the investors. Firstly, losses or gains are always calculated against the present market value of cryptocurrency at the time of purchase. With this in mind, investors can easily calculate how much tax they need to pay from their crypto. Cryptocurrency investors also should note that capital gain rates are applied to all gains.
Secondly, all purchases that an investor makes with cryptocurrencies are treated as taxable events. Each crypto investor is responsible for recording all their transactions and must report them on Form 8949. He added that individuals who are self-employed and are paid using cryptocurrencies must report their income in terms of regular income on the tax form. He also reminded the crypto investors that individuals who pay their contractors over 600 US Dollars in cryptocurrency value have to report the payments to the IRS and should file the Form 1099.
In conclusion, Ted Bauman reminded the investors that if the money for a cryptocurrency sale is utilized in purchasing a different cryptocurrency, this form of transaction is not considered a 1031 exchange. Ted Bauman urged cryptocurrency investors to follow the regulations laid out by the IRS to avoid penalties and attracting criminal charges.
About Ted Bauman: www.crunchbase.com/person/ted-bauman