The IRS released a guide on virtual currencies in 2014. Highlights include:
- Cryptocurrencies are regarded as personal property and are taxed as capital assets. They are not considered to be a currency.
- Selling cryptocurrency for fiat currency (e.g. USD) or using it to purchase goods or services are subject to capital gains tax.
- Mined cryptocurrency is taxable as income at their fair market value at the time they are obtained.
- Mining equipment qualifies as a deduction for a business expense.
Note: Lumina is intended to serve as an informational and assistive tool only. Lumina is not intended to substitute for professional tax, accounting, audit, or legal advice. Information provided on Lumina is subject to change without notice. Lumina is not responsible for the accuracy of your tax, audit, or legal compliance. Please consult a licensed professional for financial, tax, and legal advice.
