[Coinbase](https://www.coinbase.com/) Twitter tweeted a link to the article titled “The crypto guide to taxes” in the last days of March 2022. 

The tweet came a few weeks to tax season 2022 in the United States of America, and with the deadline for submitting personal gains to the Internal Revenue Service (IRS) fast approaching.

Coinbase tweets towards the end of March were on blockchain analytics, promotions for new accounts, and advanced trading on the cryptocurrency exchange. 

For Coinbase Twitter news to focus on crypto taxes means representatives of the platform continue to get messages from account holders on what activities constitute paying cryptocurrency taxes.

## Coinbase Twitter Reminder

Coinbase users have a cause to worry about Coinbase taxes. This is the primary reason why it is not surprising to find millions of verified Coinbase users asking the question of which crypto transactions are taxable? 

According to Coinbase, numerous kinds of crypto transactions are considered taxable events. Several crypto activities are taxable, but some of them are not. 

When you sell and convert crypto, you should know that you must pay crypto capital gains tax.

With that said, activities such as mining and holding digital collectibles in the form of non-fungible tokens (NFTs) and buying and holding crypto are non-taxable events.

Therefore, if you know that you have staked, spent, converted, sold, and earned crypto, you should prepare to pay taxes on cryptocurrency gains.
Taxes on personal income come in different rates and brackets, and the cryptocurrency tax is the same. Cryptocurrency tax rates fall under ordinary income or capital gains.

The rate of token tax depends on factors such as the method of obtaining the crypto and the duration you held onto the digital coins. 
IRS crypto taxes is similar to paying taxes on stocks. Therefore, you will pay relatively lower rates if you decide to HODL (hold onto your tokens for at least one year before selling them). 

You will pay taxes on crypto if you are involved in swapping tokens. A great example is trading crypto pairs such as BTC for ETH, ETH for ADA, ADA for BNB, and others. In the eyes of the IRS, swapping means you have sold your Bitcoin to buy Ethereum, Ethereum to buy Cardano, and Cardano to buy Binance Coin. In such a situation, you will realize gains or losses.

The same holds for spending. For example, you buy $20,000 worth of ETH and a price spike increases your investment by 300% to $80,000. You use your ETH to buy an automobile worth $80,000. You are then subject to paying capital gains tax on cryptocurrency.

The only way to avoid paying taxes on crypto is to use good old cash. Although it is not impossible, it would be difficult to find an exchange that accepts cash as a payment method in the current climate of crypto regulation. To put it simply, buying crypto with cash is not taxable, so you would not be having any IRS crypto problems once tax season takes center stage.

If you are a trader who transfers digital currencies between wallets such as Coinbase wallets (non-custodial wallet) and Coinbase Exchange accounts (custodial wallet), you are not subject to reporting detailed activities of such transfers.

Suppose you sent no more than $15,000-worth of crypto to friends and acquaintances. In that case, you are not eligible to file taxes on cryptocurrency.

Reporting your crypto activities and paying the necessary crypto trader tax is imperative.

The IRS has a zero-tolerance policy when it comes to paying taxes. Failure to adhere to crypto and taxes rules could lead to steep penalties. 
You can use [CoinTracker](https://www.cointracker.io/) (a trusted aggregator for tax services) to help you sort out your taxable crypto activities. 

Although Coinbase Twitter news has done its part in shedding more light on crypto and taxes, the onus falls on you, as a crypto user, to make arrangements for capital gains on cryptocurrency.

For more Business news, see [here](/news/category/crypto-business-news).



Coinbase Twitter Shares Crypto Tax Guide 

The continued worldwide adoption of crypto and blockchain took another giant leap forward today with the announcement of tax implications and the issuance of CBDC’s from the Indian Ministry of Finance.

As part of the national budget for the forthcoming year, Finance Minister Nirmala Sitharaman announced any income from the transfer of ‘virtual digital assets’ is to be subject to a 30% tax. Sitharaman went on to declare that a digital Rupee would most likely be released sometime between 2022 and 2023 providing a clear sign that India is one step ahead in its proposed release of a Central Bank Digital Currency (CBDC). 

## Largest crypto market in the world.

In a long and detailed speech lasting over two hours, Ms Sitharaman said “there has been a phenomenal increase in transaction in virtual digital assets. The magnitude and frequency of these transactions have made it imperative to provide for a specific tax regime.”  

India is believed to have one of the largest crypto markets in the world with as many as 15 million individual crypto investors. This figure has increased significantly in recent years despite the Royal Bank of India attempting to ban cryptocurrency trading in 2018 when it ordered banks not to facilitate crypto trade. More recently, in December 2021, the RBI was still pushing for a complete ban as it believed partial restrictions would not work. Therefore, although today’s announcement from the Ministry of Finance comes somewhat out of the blue it just goes to show the growth and strength of this nascent asset class is practically unstoppable.

## Indian CBDC less than a year away?

While many countries continue to explore the issuance of a CBDC few seem to have made as much progress as India. As you may imagine China lead the pack with South Korea, Canada, and the European Union all still deep in the developmental phase. 

In a press release from April 2021, The Bank of England announced plans of a ‘CBDC Taskforce’ to explore the possibility of creating its own CBDC, a statement in the following November however indicated that any plans to release ‘Britcoin’ to the general public may not come to fruition until 2025. India is well ahead in the development and release of its CBDC and while this may sound impressive it is worth remembering that every nation has a different economic framework with associated requirements. 

Speaking of CBDC’s specifically Sitharaman said that digital currencies would be “issued using blockchain and ‘other technologies’ by the RBI starting 2022-23. This will give a big boost to the economy." 

While there was no mention of crypto per se, the Minister preferred to use the term ‘Virtual Digital Asset.’ Additionally, many crypto proponents believe that ‘other technologies’ may be a nod towards third generation consensus protocols which technically don’t use a blockchain. With such a short timeline until launch India will be sure to experience a mass scramble for legitimate and up to date information, digital and hardware wallets and as can be expected the endless search for new opportunities for revenue. Watch this space.


India to Tax All Crypto Trade by 30%

Tax authorities in Japan have been investigating tax evasion of cryptocurrency transitions. The numbers have been up for discussion as a whole lot of people have been reporting lower gains than they actually made.

The National Tax Agency has already investigated a grand total of 1600 people this year. They were checking into the claims from last tax season, according to the Nikkei Asian Review . After that, about 250 more cases will be investigated. These investigations will continue through the next year as well.

## Failing to File Means Penalties

Cryptocurrency exchanges in Japan are obligated to file user tax reports by February 15th of every year . If you fail to do so, it’s possible that you’ll face penalties or even jail time if proven guilty.

Japanese authorities carried out a large-scale investigation in the Kanto region, including cities such as Saitama, Tochigi, Gunma, Niigata and Nagano. They found that only about 20% of cryptocurrency investors reported their gains or losses on crypto assets.

This was possible through a new system where exchanges match up data supplied by users and what they actually owe to the government.

For more Crypto Business news, see [here](/news/category/crypto-business-news).

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#CRYPTOTAX | Page 2

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