AI-Driven Platforms Streamline Crypto Tax Compliance Amid Complex Rules
Cryptocurrencies are classified as property for tax purposes in most jurisdictions, meaning activities like selling, swapping, or spending digital assets trigger taxable events. Holding crypto for less than 12 months typically subjects gains to ordinary income tax rates, while longer-term holdings may qualify for reduced capital gains rates [1]. Traders must track transactions, including dates, amounts, and fair market values, to calculate gains or losses accurately. Earnings from staking, mining, or airdrops are treated as taxable income at the time of receipt, further complicating tax obligations [1].
Common taxable events include selling crypto for fiat currency, trading one cryptocurrency for another, and using crypto to purchase…
