How do I calculate my taxes? - Deepstash

How do I calculate my taxes?

If you've bought crypto, HODLed, and sold it later, your tax liability should be fairly easy to calculate. Let's look at a simplified, US-based example. 

Here's the formula:

  • Fair market value - Cost basis = Capital gain / Loss
  • The fair market value is the current spot price you'd find on an exchange. 
  • Cost basis is the original price you paid for the asset plus any fees.

Imagine you bought 2 BTC for $10,000 and sold them two years later for $30,000. You've now made $40,000 in capital gains: $60,000 (fair market value) - $20,000 (cost basis) = $40,000 (capital gains)

63

348 reads

CURATED FROM

IDEAS CURATED BY

cryptostash

Don’t Risk More Than You Can Afford to Lose!

The idea is part of this collection:

Getting started with Cryptocurrency

Learn more about crypto with this collection

Understanding the basics of cryptocurrency

How to store cryptocurrency securely

Risks and benefits of investing in cryptocurrency

Related collections

Read & Learn

20x Faster

without
deepstash

with
deepstash

with

deepstash

Personalized microlearning

100+ Learning Journeys

Access to 200,000+ ideas

Access to the mobile app

Unlimited idea saving

Unlimited history

Unlimited listening to ideas

Downloading & offline access

Supercharge your mind with one idea per day

Enter your email and spend 1 minute every day to learn something new.

Email

I agree to receive email updates