With so many people looking for more ways to make money outside their 9 to 5 jobs, many are turning to money making methods using technology including trading in cryptocurrency.
For tax purposes, the IRS considers cryptocurrencies property, not as currency. Just like other property types, stocks, investments, or real estate, when you sell, swap, or otherwise dispose of your cryptocurrency for more or less than you acquired it for, you incur a tax reporting obligation.
As an example, there would be a $1,000 capital gain if 0.1 bitcoin is bought for $2,000 in June of 2020 and then sold for $3,000 two months later. This profit must be reported on the tax return and a certain amount of tax is due on the gain, depending on the tax bracket of the taxpayer. In this example, the gain would be short term requiring the profit to be taxed at the filer’s ordinary tax rate. These rates range anywhere from 0-37%.
The Tax Professional Self-Care 10 Commandments
Every Spring there is some point in the tax season that I have to remind myself why I chose to become a tax professional. I am often comforted to find out that I am not the only person questioning my career decision. Tax pros nationwide share on social media that they are thinking the same thing. So let me ask you.
Why did you choose to do this to yourself again?
You promised yourself to fire problem clients and improve systems. Yet we’re here in March, how did you do with keeping your promise to yourself?
My first busy season Thomas Reuters released a video that I found funny, at one of their tax conferences. There are children that talk about why they want to be a tax accountant. A few reasons they give are:
• To work 22-hour days;
• To work with numbers that are changing all the time;
• Having lots of turnover with burned out employees.
My personal favorite is to have 3 people do the work of 8.
In hindsight it almost sounds like they were describing the tax industry during 2020 and 2021. When I first watched the video, it was hilarious. But 12 years later I still smirk, but for different reasons. I can totally relate to the sarcasm. Nobody goes into this industry for those reasons yet here we are each Spring on the verge of burnout.
Did you think of your why? I want you to write it really big and post it somewhere that you will see it every day when you are working at your desk.
I want to share with you 10 things that you can implement to protect you and your why. I like to call them the Tax Professional Self-care 10 Commandments.
