Cryptocurrency Q&A
How do I calculate capital gain on a crypto purchase?
How do I calculate capital gain on a crypto purchase?
Daniele
Sun Jul 14 2024
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7
answers
1418
As a crypto investor, I'm curious about how to accurately calculate capital gain on a cryptocurrency purchase. Could you please explain the steps involved in determining this gain? Specifically, I'm interested in understanding how to factor in the initial purchase price, any applicable fees, the selling price, and any additional taxes or costs that may arise. It would be great if you could provide a concise yet comprehensive explanation of the process, as well as any tips or best practices for accurately tracking these transactions for future tax filings or portfolio evaluations. Thank you in advance for your help.
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7 answers
Lucia
Tue Jul 16 2024
When calculating your capital gains in cryptocurrency investments, it is crucial to track your purchase and sale amounts.
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alexander_clark_designer
Tue Jul 16 2024
To begin, add up the total cost of your initial cryptocurrency purchase. This figure serves as the baseline for determining your profit or loss.
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Chiara
Mon Jul 15 2024
Next, record the amount you sold your cryptocurrency for. This represents the proceeds from your investment.
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Giuseppe
Mon Jul 15 2024
Short-term holdings, typically defined as less than a year, are taxed differently than long-term holdings. Understanding this distinction helps you accurately calculate your tax obligations.
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BonsaiGrace
Mon Jul 15 2024
Subtracting your initial purchase cost from the sale proceeds gives you your capital gain. This is the profit you made on your investment.
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