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Recap HomeIRS Virtual CurrenciesUK Tax GuideSA Tax Guide
  • Cryptocurrency Tax Guide for US Individuals
    • Virtual Currency & Cryptocurrency
    • Who are Recap?
  • CRYPTOCURRENCY TAX
    • Do I Need to Pay Tax on my Crypto?
    • Which Taxes Apply?
      • Capital Gains Tax (CGT)
      • Income Tax
      • Non-Taxable Transactions
    • How Much Tax Will I Pay?
    • Capital Gains Tax
      • Calculating the Capital Gains and Losses
      • Cost Basis Methods
      • Disposal proceeds
        • Non Taxable Events
        • Taxable Events
        • Donating cryptocurrency to a charitable organization
        • Gifting cryptocurrency to another person
    • Income Tax
      • Receiving cryptocurrency from mining
      • Receiving cryptocurrency rewards
      • Forks
      • Airdrops
      • Tax on Tokenswaps and Mainnetswaps
    • Deductibles and Reducing Capital Gains
  • TRANSACTION TYPES
    • 💷Selling Crypto for Fiat
    • 🛍️Purchases using Crypto
    • 🔄Exchanging one crypto for a different crypto
    • 🎗️Donations to Qualified Charities
    • 🎁Gifts
    • 🎈Airdrops
    • 🤝Staking
    • 💸Transfers
    • 🍴Forks
    • ⛏️Mining
    • 👛Employment income
    • 🚨Lost & Stolen Crypto
    • 💧Liquidity Pools
    • 🔮Cryptoasset derivatives (CFDs, Futures and Margin Trading)
    • 💼Crypto Loans
    • 💎Lending Rewards
    • 🪞Reflections Rewards
    • 👥Referral Income
    • 💳Cashback
    • 🎨NFTs (Non Fungible Tokens)
    • 🎮Play-to-earn gaming NFTs
  • Record Keeping
  • Reporting Income and Gains to the IRS and Paying the Tax
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  • Cryptocurrency gifts
  • Donations to qualified charities
  • Margin Trading

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  1. CRYPTOCURRENCY TAX
  2. Which Taxes Apply?

Non-Taxable Transactions

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Last updated 3 years ago

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Not every transaction is taxable or reportable under the tax code.

Some of these transactions include:

  • Purchasing cryptocurrency with fiat currency (USD, GBP, EUR, etc.)

  • Transferring cryptocurrencies between wallets and exchanges you own

  • Sending or receiving cryptocurrency as a gift

  • Making donations to qualified charities in cryptocurrency

Cryptocurrency gifts

Cryptocurrency gifts may be non-taxable to both the giver and recipient, so long as you do not exceed the annual tax exclusion threshold ($15,000 per recipient per year) or lifetime gift tax exclusion. Gifts over $15,000 will need to be reported by the sender on an annual gift tax return. The cost basis of any gift should be provided to the recipient, since the recipient will inherit the original cost basis from when the sender originally acquired the cryptocurrency.

For example, if you bought 1 BTC in 2013, and then gifted it to someone in 2020, the recipient’s cost basis would be whatever you originally paid for that 1 BTC in 2013.

Donations to qualified charities

Donations to qualified charities under US tax law may count as a charitable donation and help lower your overall tax liability. These donations should be reported on your return.

Margin Trading

Because cryptocurrency is considered property by the IRS, in margin trading, borrowing funds to trade crypto is not considered a taxable event. In fact, any time you borrow or take a loan it is not taxable. However, when you close the position (sell the property), gains (or losses) will be reportable on your tax return. In summary, borrowing crypto is not taxable, but any trades you do with the borrowed crypto is taxable.

🎁Gifts
🎗️Donations to Qualified Charities
🔮Cryptoasset derivatives (CFDs, Futures and Margin Trading)