> Doyle says many crypto investors mistakenly think they can sell some Bitcoin to buy some Etherium, and that making that a switch like that did not trigger an obligation to pay tax.
Make a stupid rule, be surprised people are non-compliant.
Make a stupid rule, be surprised people are non-compliant.
If I sell Nvidia stock to buy AMD stock, I need to pay tax on my Nvidia stock gains.
I imagine if it turned out you never possessed any AMD or Nvidia stocks and all of that was just fake number on a fake piece of paper there would be serious government involvement pretty much everywhere.
Also on more practical note, a single sale of crypto can really be a 50 sales to 50 people at various prices. Calculating gain is virutally unworkable. Especially between crypto pairs where the value of one or the other isn't really known.
When you sell NVidia stock and buy AMD it's a sale and a purchase. But if somebody gave you some AMD stock for your NVIDIA stock, there's no sale or purchase and the value of each is only a guess.
That's why reasonable countries decided it's way better to tax stuff on exit to fiat, via conversion or purchase. And it works just fine. When it's crypto it remains Miki Mouse money, but when it exits to fiat and there's more of it than was put in, there's real and taxable gain.
You example about trading equities (gifting? sharing?) is wrong. You owe tax on trading your stock for another stock. Even if you circumvent a broker and deal in literal certificates. This is a disposition in the eyes of every major tax authority. There are very few exceptions (rollovers or corporate reorganization are some examples). Difficulty in calculating the FMV of the disposition is entirely your problem.
1. can you recognize a capital loss on unregulated products like crypto and NFTs for favourable tax treatment?
2. do the exchanges (from an accounting perspective) trade directly between coins or move through a fiat (i.e. USD) currency?
So it might be more like "trading" stock directly without seeing the cash hit your account, which confuses people as to why they trigger a capital gain. The extra step of calculating the value of the source stock at the time of transaction is being missed.
Depends on the country. The US and Canada allow it.
> do the exchanges (from an accounting perspective) trade directly between coins or move through a fiat (i.e. USD) currency?
Doesn't matter. If you swap TSLA for MSFT with someone there is still tax due.
When you sell NVidia stock and buy AMD it's a sale and a purchase. But if somebody gave you some AMD stock for your NVIDIA stock, there's no sale or purchase and the value of each is only a guess.
That's why reasonable countries decided it's way better to tax stuff on exit to fiat, via conversion or purchase of something other than crypto. And it works just fine. When it's crypto it remains Miki Mouse money, but when it exits to fiat and there's more of it than was put in, there's real and taxable gain.
Taxing crypto on every trade would be like taxing forex on every trade.
Forex is also typically taxed on every trade.