How can I minimize my tax liability on unearned income from cryptocurrencies?

3 answers

• Nov 23, 2021 · 3 years ago
  One strategy to minimize your tax liability on unearned income from cryptocurrencies is to hold your investments for at least one year. By doing so, you may qualify for long-term capital gains tax rates, which are typically lower than short-term rates. This can help reduce the amount of taxes you owe on your earnings.
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• Nov 23, 2021 · 3 years ago
  Another way to minimize your tax liability is to take advantage of tax deductions and credits. For example, you may be able to deduct certain expenses related to your cryptocurrency investments, such as transaction fees or the cost of hiring a tax professional. Additionally, you may qualify for tax credits, such as the foreign tax credit if you have earned income from cryptocurrencies in foreign countries.
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• Nov 23, 2021 · 3 years ago
  At BYDFi, we recommend consulting with a tax professional who specializes in cryptocurrency taxation. They can provide personalized advice based on your specific situation and help you navigate the complex tax laws surrounding cryptocurrencies. They can also help you identify any potential tax credits or deductions you may be eligible for, ensuring you minimize your tax liability while staying compliant with the law.
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