Coinbase, Exchanges

Do I Have to Pay Taxes on Coinbase?

The short answer is yes, you have to pay taxes on Coinbase. The long answer is a bit more complicated.

When it comes to cryptocurrency, the IRS has been clear that they consider it to be property, not currency. That means that any gains or losses you realize on your crypto holdings are subject to capital gains taxes.

If you’re selling crypto for fiat currency (like US dollars), you will owe capital gains taxes on the difference between the price you paid for the crypto and the price you sold it for.

If you’re using crypto to purchase goods or services, you will owe capital gains taxes on the difference between the price you paid for the crypto and the price of the goods or services you purchased.

The same rules apply if you’re holding crypto in a wallet – you will owe capital gains taxes on any increase in value of your holdings.

So, whether you’re buying, selling, or just holding crypto, it’s important to keep track of your basis (the original purchase price) so that you can accurately calculate your capital gains (or losses) when it comes time to file your taxes.

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