Kucoin and CryptoTaxCalculator collaborate
As seen below, CryptoTaxCalculator is pleased to announce a cooperation with Kucoin. In order to estimate their taxes, we now make it incredibly simple for customers to enter their data directly from Kucoin into our calculator. To learn how Kucoin’s crypto taxes operate and how to enter data into CryptoTaxCalculator, refer to the instructions below. According to the source Kucoin is the best and secure platform for trading.
Taxes on bitcoin
Trading on Kucoin, like all exchanges, is subject to income tax or capital gains tax based on a number of variables, including whether you are trading as a business or an individual. Visit our Crypto Tax Guide for a detailed analysis of crypto taxes in Australia.
When you are transferring between crypto and fiat or crypto to crypto, and whether or not you are in control of the funds in your exchange account, it is crucial to understand when a capital gains event occurs (some exchanges will take control of your funds while some simply negotiate on your behalf). Despite the slow start to 2022, many experts are still bullish ethereum price prediction could potentially hit and exceed $12,000 this year.
Records Keeping It is crucial to preserve records of all transactions with the bare minimum of data, such as date, time, amount, and currency. Records may be requested from the ATO for up to 5 years after the trade has occurred. Fortunately, Kucoin provides two ways to obtain this information: either you can construct an API to gather the data for you or you can export your transaction history as a simple CSV file.
IRS Guidelines for Calculating Crypto Taxes
Let’s start with how cryptocurrency taxes are determined in general.
The IRS classifies cryptocurrencies as assets, similar to stocks, rather than conventional money (like Euro, USD, or Yen). This implies that you must notify the IRS of any capital gains or losses if you sell or exchange cryptocurrency.
The capital gain is the price difference between when you bought and sold your cryptocurrency. The cost basis (price at which you purchased or received each separate asset) should be subtracted from the total number of cryptos you acquired or sold over the course of the year in order to determine your capital gains from crypto. The ethereum price prediction by some experts show that there’s no change in price at the end of this year.
Keep in mind that short-term capital gains (holding cryptocurrencies for less than a year) are taxed at a higher rate than long-term capital gains (holding assets for more than a year) (long-term capital gains tax).
Example Of Calculating Crypto Taxes
If you have all of the details of your transactions in one place, it will be simpler to calculate your capital gains and losses.
Assume you acquired BTC, swapped it for LTC in the short term, and then sold LTC for fiat money in the long run. As a result, your capital gains tax for periods of less than a year and more than a year will be equal to your short-term and long-term trades, respectively.
BTC purchased for $10,000. (Cost basis)
The following day, BTC was sold for LTC valued $12,000 (proceeds)
Cost Basis – Proceeds = $2,000
You are responsible for paying this amount in short-term gains tax.
Sold LTC for $13,000 after more than a year, a value of $12,000.
The current earnings are $13,000.
Proceeds minus Cost Basis equal $1,000 in profit.
This is the amount of long-term gains tax that you must pay.
Crypto Tax Reports: Who Must Inform the IRS of Crypto Taxes?
The IRS must receive a report from every US resident who is obligated to file an annual income tax return.
Any person who receives income from US sources may also need to pay US taxes. Foreign nationals may therefore be subject to tax responsibilities if they conduct business on any of the US-based exchanges (Coinbase, Bittrex, Gemini, Kraken, Bitstamp, etc.).
When Must a Crypto Tax Report Be Filed?
Because US returns are normally due on this day, April 15 is commonly referred to as “Tax Day” (or the following Tuesday if the 15th falls on a weekend). The IRS’s e-file program me or by submitting a paper form 4868, anyone can request a 6-month extension (to file, but not to pay), and US citizens living abroad automatically obtain a 2-month extension. Those who own a business and have capital gains over $1,000 are required to file quarterly reports.
What Constitutes A Taxable Event Under Crypto Tax?
If you understand how to calculate cryptocurrency taxes, you can have certain concerns, like: do I have to pay taxes?
How about blunt forks?
Generally speaking, crypto activity can consist of:
Trading (buying one Bitcoin with another cryptocurrency type)
Using cryptocurrency to make purchases
trading in cryptocurrencies