Is the wash sale rule applicable to cryptocurrency transactions?

3 answers

• Dec 16, 2021 · 3 years ago
  Yes, the wash sale rule can be applied to cryptocurrency transactions. The wash sale rule is a regulation that prohibits investors from claiming a tax deduction on a security if they sell that security at a loss and then repurchase the same or a substantially identical security within a short period of time, typically within 30 days. While the IRS has not explicitly stated that the wash sale rule applies to cryptocurrencies, many tax experts believe that it can be applied to cryptocurrency transactions due to the similarities between cryptocurrencies and securities. Therefore, if you sell a cryptocurrency at a loss and repurchase the same or a substantially identical cryptocurrency within a short period of time, you may not be able to claim a tax deduction for the loss.
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• Dec 16, 2021 · 3 years ago
  No, the wash sale rule does not apply to cryptocurrency transactions. The wash sale rule is a regulation that specifically applies to stock transactions and does not have any direct application to cryptocurrencies. Cryptocurrencies are considered property by the IRS, not securities, and therefore, the wash sale rule does not apply. However, it's important to consult with a tax professional or accountant to understand the specific tax regulations and implications related to cryptocurrency transactions in your jurisdiction.
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• Dec 16, 2021 · 3 years ago
  According to BYDFi, a leading cryptocurrency exchange, the wash sale rule is not applicable to cryptocurrency transactions. Cryptocurrencies are not considered securities and are treated as property by the IRS. Therefore, the wash sale rule, which specifically applies to stock transactions, does not apply to cryptocurrencies. However, it's important to consult with a tax professional or accountant to understand the specific tax regulations and implications related to cryptocurrency transactions in your jurisdiction.
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