Cryptocurrency Tax Specialists Happy Tax Offers Tax Tips For US Filersbr>
Happy Tax has a long association with the cryptocurrency community. In 2017, the firm started accepting cryptocurrency for its franchise fees, becoming the first national franchise company of any kind to embrace this new asset class.
Happy Tax was founded by Mario Costanz, author of the best-selling book Taxes Made Happy – The Definitive Strategy Guide to Launching and Growing a Successful Tax Preparation Business. He was named “One to Watch” by Accounting Today’s Top 100 Most Influential People in Accounting List in 2017.
The company’s latest announcement is CryptoTaxPrep.com, making Happy Tax the the first crypto-specialty tax practice to assist bitcoin and cryptocurrency traders.
As everyone scrambles to figure out how to organize their tax records by the end of the year, Happy Tax is providing their top five tips for crypto traders:
1. Hold for more than 12 months. This makes your gains (or losses) long-term capital gains (or losses). This is HUGE. Most people will pay only 0% – 15% in taxes on long term gains (20% if your income is > $418,401 as a single person). This compares to the ordinary tax rate (up to 39.6% for 2017) on short term capital gains (when you HODL’d a certain buy for less than 12 months).
2. Consider a self-directed Roth IRA. Your gains could, potentially, be tax free! Make sure to consult with a qualified tax professional before choosing this strategy as there are several factors that must be considered.
3. Consider a charitable contribution using cryptocurrency. You can donate up to 30% of your Adjusted Gross Income (AGI) and deduct every penny of the fair market value at the time the donation was made. You may need a qualified appraisal.
4. Unless you are mining, do NOT try to put your trades into an LLC. You will likely end up having to pay self employment tax in addition to income tax. If you are mining, consult a tax professional for your specific scenario.
5. Keep good records. You need to track every transaction (and know your basis). All transactions are required to be reported by the IRS. Even if you use crypto to buy a cup of coffee. Sound daunting? We can help; our team of licensed CPAs can help you account for all of your crypto transactions using automated technology and then file a fully guaranteed tax return for you.