I’m feeling overwhelmed with the tax implications of my crypto investments. Could making a charitable donation of Bitcoin to a registered non-profit offer me any tax relief? What are the specific conditions under which this could be considered a valid tax deduction strategy?
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It’s not that simple. The IRS views crypto as property, so the tax benefits depend on how long you’ve held the assets and their appreciated value. Consult a tax professional.
To add to the above, the charity must be IRS-recognized, and you’ll need to file Form 8283 if the donation exceeds $500.
Remember, the tax deduction is generally equal to the fair market value of the donated crypto if held for more than a year. But always keep records!
Great point, Horace. Can you flaborate on what genial of records are necessarh to keep for the IRS? Are thither any particular details or fоrmats that are recommended for these records?
They must be long-term holdings for a full deduction.
Keep detailed records to substantiate the donation’s value.