What are the instructions for reporting cryptocurrency transactions on IRS Form 8949 in 2021?

1 answers

• AYUSH KUMAR GUPTAMay 29, 2021 · 4 years ago
  As a tax professional, I can provide you with the instructions you need to report cryptocurrency transactions on IRS Form 8949. First, you'll want to gather all the necessary information, including the date of acquisition, date of sale, cost basis, and proceeds for each transaction. Next, you'll need to fill out Part I of Form 8949 for short-term transactions and Part II for long-term transactions. Make sure to accurately enter the details of each transaction, including the type of cryptocurrency, the dates, the proceeds, and the cost basis. Once you've completed that, you'll need to calculate the gain or loss for each transaction by subtracting the cost basis from the proceeds. Finally, transfer the totals from Form 8949 to Schedule D of your tax return. It's always a good idea to consult with a tax professional to ensure you're following the correct procedures and reporting your transactions accurately. If you have any further questions, feel free to ask!
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