Crypto Tax Returns for 2018 May Be Lifted If You Live off Crypto Only: Report
Good news comes in despite the bearish wave that dominated the crypto market all throughout 2018 and seems to continue now.
A crypto tax advisor that goes by the name CryptoTaxGirl on Twitter has announced that people with crypto being the only source of income and under a certain level of monthly profits back in 2018 will be allowed to not pay taxes.
I've talked to a few clients lately who have no other income besides crypto, and if this applies to you, then as long as your taxable income from long-term gains is under $38,600 (single) or $77,200 (married) then you will not owe any tax and don't need to file a tax return.
— Crypto Tax Girl (@CryptoTaxGirl) March 11, 2019 What caused the loophole
The loophole on crypto taxes this year has appeared owing to regulatory measures regarding long-term capital gains. CryptoTaxGirl says that tokens stored for more than a year are considered to be long-term gains – this fact increases the minimum amount of taxes to be filed.
Digital tokens stored for a time period smaller than a year are now referred to as short-term gains/losses. Single payers have to pay taxes for gains over $12,000, married ones – from profits over $24,000. But, considering the heavily bearish crypto market that dominated last year, even these figures can be all that these people have to live on.
As for caveats, there are a few in this particular case, as is with any loophole. First of all, users must have held their tokens for more than a year.
The second one is that the loophole does not apply to tax filings related to all states. Every US state uses different methods of filing gains and losses from crypto trades. Some consider long-term gains as simple income, which means that a tax return is expected for any filing with such income on it.
The third one is that the loophole works only for those for whom crypto is the only source of income. Those who make a living from other sources as well must submit a tax return anyway – for reporting their income from that particular non-crypto source.Read full story on u.today