The Guide to Claiming Cryptocurrency Tax Losses
By Anthony Diosdi Did you lose money trading cryptocurrency this year? If so, you may have the opportunity to reduce your tax bill. This article will discuss the losses associated with cryptocurrency that can and cannot be claimed on a tax return. Claiming Ordinary and Capital Losses Associated With CryptocurrencyA cryptocurrency investor is allowed to utilize losses to the extent of gains from sales up to $3,000 ($1,500 in the case of a married individual filing a separate return) annually against ordinary income such as wages. Any losses exceeding $3,000 can be claimed in future tax years. A cryptocurrency trader may also claim capital loss deductions under Internal Revenue Code Sections 1211 and 1212. When a crypto investor offsets capital gains with losses in cryptocurrency, the investor is permitted to…