How does the 60/40 futures tax rate affect the taxation of digital assets in the cryptocurrency market?

1 answers

• atedsgApr 04, 2023 · 2 years ago
  The 60/40 futures tax rate is a tax provision that affects the taxation of digital assets in the cryptocurrency market when they are traded as futures contracts. This tax rate means that 60% of the gains or losses from futures contracts are subject to the long-term capital gains tax rate, while the remaining 40% are subject to the short-term capital gains tax rate. The long-term capital gains tax rate is typically lower than the short-term rate, so this provision can have an impact on the overall tax liability for individuals or businesses trading digital assets as futures. It's important to keep accurate records of all transactions and consult with a tax professional to ensure compliance with tax laws and optimize your tax strategy.
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