Crypto Tax Lawyer: What You Need to Know?

If you’re an investor who has made money from your cryptocurrency investments, then you may need to think about how you’ll be reporting that on your tax return this year. It is important for crypto investors to understand their responsibilities when it comes to taxes. 

Since cryptocurrencies are classified as assets, they are not treated as a currency like the dollar when it comes to taxes. That being said, if you have made profits from investing in crypto assets, then you’ll probably want to talk with a crypto tax lawyer before filing your taxes this year. 

In this article, we’ll discuss what you need to know about using a crypto tax lawyer services and what sort of things these professionals can help with for your unique circumstances as an investor with cryptocurrency assets.

What Is a Crypto Tax Lawyer?

A crypto tax lawyer is essentially a legal professional who specializes in helping investors understand and comply with their tax reporting and tax obligations surrounding their cryptocurrency investments. 

In particular, these professionals can help you to accurately report your income from crypto assets on your taxes and also offer advice on how to minimize any taxes that you may owe from your crypto investments. 

These crypto tax lawyers can help you to navigate the complex world of crypto taxes in your country and can also help you to know what records to keep for future tax reporting purposes. Some crypto tax lawyers may also have experience helping you with filing regulatory and compliance issues with government agencies like the Internal Revenue Service (IRS).

Should You Hire a Crypto Tax Lawyer?

When it comes to deciding whether to hire a crypto tax lawyer, there are a few considerations that you’ll want to make. First and foremost, you’ll want to make sure that you’re complying with any regulations or requirements in your country for filing taxes related to your crypto investments. 

In some cases, you’re required to report your profits from crypto assets on your taxes for the current year. In other cases, you’re required to report your profits on your taxes for the previous year. If you’re unsure about what the requirements are in your specific situation, then you may want to consult with a crypto tax lawyer to have them walk you through your specific reporting obligations. 

A tax lawyer can also help you to see if you’re at risk of incurring any fines or penalties from the government for failing to report your crypto income on your taxes.

Recordkeeping for Tax Reporting Purposes

Crypto tax lawyers can also help you to make sure that you’re keeping the right sort of records for tax reporting purposes. In general, you’ll need to keep track of the amount of money that you’ve invested in cryptocurrency assets, as well as the amount of money that you’ve withdrawn from your crypto assets. 

This includes the money that you’ve withdrawn from exchanges and wallets where you’ve stored your cryptocurrencies. If you’ve made money from crypto investments in the past, then you’ll want to make sure that you’re keeping track of that information for tax reporting purposes. 

In some cases, crypto investors have failed to report their investment profits on their taxes in the past. This is often because they’ve failed to keep good records of their crypto investment activity. A crypto tax lawyer can help you to organize your records in a way that makes it easy to report your crypto income on your taxes.

Tax Consequences of Investing in Crypto Assets

If you’re thinking of investing in cryptocurrency, you may be wondering what the tax consequences are. The good news is that there are some significant tax benefits to be had by investing in crypto assets. Here’s what you need to know about the tax consequences of investing in cryptocurrency.

When it comes to taxes, there are two key things to keep in mind: capital gains and income tax. Capital gains refer to the profit you make when you sell an asset for more than you paid for it. Income tax, on the other hand, is the tax you pay on the money you earn from working or from investments.

In general, capital gains are taxed at a lower rate than income tax. That’s because capital gains are considered to be a long-term investment, while income is considered to be taxed at a higher rate because it’s considered to be more immediate.

However, there are some exceptions to this rule. For example, if you hold crypto assets for less than a year before selling them, you’ll be taxed at your marginal tax rate (which is the highest tax bracket you’re in). This is why it’s important to consult with a tax professional before making any decisions about investing in cryptocurrency.

Get to Know Your Tax Reporting Obligations

If you are trading or investing in cryptocurrency, it’s important to be aware of your tax reporting obligations. Depending on how you acquired your digital assets and what you did with them afterward, you may need to report your gains (or losses) on your annual tax return.

If you’re not sure whether or not you need to report your crypto activity, we recommend speaking with a qualified tax professional. Not only can they help you understand your specific situation, but they can also ensure that you’re complying with all relevant tax laws.

Call Mary King for All Your Crypto Tax Questions

Have you been thinking about investing in cryptocurrency, but are worried about the tax implications? Are you already invested in crypto and unsure of how to file your taxes? If so, you’re not alone. The world of cryptocurrency is complex and ever-changing, and the tax laws are still catching up. That’s why it’s important to seek out the advice of a qualified crypto tax lawyer.

At the Law Offices of Mary King, we understand the unique challenges that come with investing in cryptocurrency. We can help you navigate the complicated tax laws and make sure you stay compliant with the IRS. Contact us today to schedule a consultation.

Call: 941-906-7585

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The information in this blog post is for reference only and not legal advice. As such, you should not decide whether to contact a lawyer based on the information in this blog post. Moreover, there is no lawyer-client relationship resulting from this blog post, nor should any such relationship be implied. If you need legal counsel, please consult a lawyer licensed to practice in your jurisdiction.