 | The tax rate on bitcoin varies from person to person. It is dependent on how long you held your bitcoin and what personal income tax bracket you fall into for any given year. Disposing of bitcoin will trigger a capital gains tax event and be taxed as long-term or short-term capital gains. If you hold bitcoin/cryptocurrency for more than a year, your disposals will be subject to long-term capital gains tax rates, and if you hold it for less than a year, they will be subject to short-term capital gains tax. Short term gains are taxed at the following rates: Long term gains are taxed at the following: If you have been dollar cost averaging into bitcoin, it can be helpful to use a crypto tax software tool to view the holding period of your full crypto portfolio to help identify which of your assets currently qualify for the more favorable long term rates. Happy tax season to all those who celebrate. [link] [comments] |
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