Are there any limitations on the deduction of long-term capital losses from cryptocurrency transactions?

1 answers

• Feb 17, 2022 · 3 years ago
  Absolutely! When it comes to deducting long-term capital losses from cryptocurrency transactions, there are some limitations you need to be aware of. The IRS treats cryptocurrency as property, so the rules for deducting capital losses are similar to those for other types of property. You can offset your long-term capital gains with your long-term capital losses. However, if your losses exceed your gains, you can only deduct up to $3,000 of the excess loss in a given tax year. The remaining losses can be carried forward to future years. It's important to keep detailed records of your cryptocurrency transactions and consult a tax professional to ensure you're following the proper guidelines for deducting your losses.
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