How does the IRS treat NFT taxation for cryptocurrency investors?

1 answers

• Jan 08, 2022 · 3 years ago
  At BYDFi, we understand the importance of tax compliance for cryptocurrency investors. When it comes to NFT taxation, the IRS treats it similarly to other forms of cryptocurrency. Selling an NFT is considered a taxable event and you may be subject to capital gains tax. The tax rate depends on how long you held the NFT before selling it. If you held it for less than a year, it is considered a short-term capital gain and taxed at your ordinary income tax rate. If you held it for more than a year, it is considered a long-term capital gain and taxed at a lower rate. It's crucial to keep accurate records of your NFT transactions and consult with a tax professional to ensure compliance with IRS regulations.
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