Crypto losses and taxes..

Nov 26, 2018 27 Comments

Finally sold my ETH for 85%loss .. I lost over 15k in crypto market ... I was trading using gdax FYI ..

Is anyone claiming crypto losses in the 2018 returns?

Any advise?

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TOP 27 Comments
  • Facebook / Eng Direct
    I'm an investment jinx. Everything that I invest in drops, and it only begins dropping shortly after I invest in it. Litecoin, Google stocks, Wealthfront, and... FB stocks.
    Nov 26, 2018 3
    • New / Eng uhYr23
      If it also happens the other way around, please let us know what you're selling now.
      Nov 26, 2018
    • RackWare Dreamlight
      You should start buying puts.
      Nov 26, 2018
    • You are not an investment jinx. You are just young and stupid Because the system is designed to fail people like you and me.
      It's all overly complex so that part timers can fail .

      Money thrugh investment is a huge virtual reality . You feel like you are getting rich but you aren't.
      Nov 26, 2018
  • General Mills / Data MUsi88
    Buying high and selling low. My man. Come join us over at /r/WallStreetBets and we’ll compound those losses in no time.
    Nov 26, 2018 0
  • New / Eng TY!
    Did you report any profits in previous years? They might wonder where your losses come from if you’ve been buying and selling before without reporting.
    Nov 26, 2018 2
    • OP
      Nope no profits at all. I did not buy anything until Jan 2018 and when I bought eth started to drop 🤦🏼‍♂️
      Nov 26, 2018
    • New / Eng TY!
      Don’t beat yourself up over it. It’s a game of chance with cryptos and no one could with certainty know if we would be at 1k or 100k around this time.

      (Unless you’re professional and know how to setup a game plan and use stop losses correctly - then maybe you should beat yourself up a bit)
      Nov 26, 2018
  • Google / Eng l+#&
    Yes you certainly can claim the loss (short term in your case). You can offset it against other short term gain you might have this year, or deduct 3k from income this year and roll the remainder loss over for next year and so on.

    It's just like say you lost in stocks. Exactly same tax wise.

    Use cointracker.io to help you file taxes (not affiliated, just a happy customer).
    Nov 26, 2018 1
  • Facebook public2
    The irs considers crypto property so there is no way to claim a loss. See the irs website for details.
    Nov 26, 2018 11
    • Facebook public2
      As crypto is not an investment there's no deduction. You cannot write off loses from property. It would be like buying a car and then selling that car for 10k less a year later; there's no write off for property. See the pdf:
      Nov 26, 2018
    • eBay CEbi00
      Thanks for the link . But does not make sense to me . We would pay tax if we make profits , but if we make losses , there is no deduction . How does that logic make sense .
      Nov 26, 2018
    • This is absolutely not true.
      Nov 26, 2018
    • Facebook public2
      Which part is not true? Crypto is property. I am not saying I agree just pointing out the irs definition (link above). Yes if you make a gain (following the car analogy you sell the car for 2x what you paid, you pay tax) there is no deduction. I looked into this a while back to see if there was an advantage to selling and rebuying post drop.
      Nov 26, 2018
    • eBay CEbi00
      https://blog.visor.com/crypto/tax-rules-for-cryptocurrency-losses/
      most of the websites do not cover this information from IRS interpretation , and I m referring to 2018 references
      Nov 26, 2018
    • Facebook public2
      I would trust the 2019 irs guidance over a blog suggesting 3k yearly write off but up to you of course!
      Nov 26, 2018
    • eBay CEbi00
      @public2 thanks for bringing up challenging questions and thought process . I referred few links just to interpret what IRS meant , and this is what I think . https://ttlc.intuit.com/questions/4228412-i-have-some-losses-through-investing-into-crypto-currency-lately-how-do-i-report-that-into-my-tax-return-filing
      So basically if you use crypto for personal use such as buying goods or services , you can’t deduct losses. However if you are using as an investment , then investment property rules apply .
      Nov 26, 2018
    • Facebook / Eng moma1
      Fuck. I am not selling yet. I am down $15k+ but still HODL.
      Nov 26, 2018
    • eBay CEbi00
      @public2 can you review this and comment ,put your perspective if this link makes sense . Per them , they are like regular capital
      https://bitcoin.tax/blog/crypto-currency-tax-losses-deduction/
      Nov 27, 2018
  • Ask a CPA. If treated like stock loss, you can claim a few thousand per year for 3 years.
    Nov 26, 2018 0
  • Looks like crypto was a great TC normalizer, a lot of FANG folks invested into it and now appear to have lost most of their money.

    Too much greed will sink you on WS, go with solid blue chips (better if it pays dividends), else go in with clear exit strategy.
    Nov 26, 2018 1
    • Google TYAPU
      .. a lot of FANG folks also made money. Me included.

      Overall I was up 65% over 3 months.
      Nov 26, 2018
  • Facebook / Eng moma1
    My ETH avg price is $400. At one point it was $2k. Now it's $110 :/.

    HODL. I have put $25k in crypto or below 5% of my net worth. Don't plan on selling them anytime soon.
    Nov 26, 2018 0
  • MuleSoft Damndaniel
    This ^. Gotta start buying puts beforehand.
    Nov 26, 2018 0

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