The IRS Virtual Currency Guidance: Notice 2014-21 names bitcoin as an example of a virtual currency and states “Bitcoin can be digitally traded between users and can be purchased for, or exchanged into U.S. dollars, Euros, and other real or virtual currencies.”
This notice is a great opportunity for individuals and investors. Since bitcoin can be exchanged for dollars or other currencies, it can be used in place of dollars or other currencies to make investments. As a result, cryptocurrencies like bitcoin or Ethereum can be used in place of dollars or other currencies to make investments and to fund your IRA or 401K.
Also in The IRS Virtual Currency Guidance: Notice 2014-21 it is stated that for Federal Tax purposes, bitcoin will be regarded as “property.” Since bitcoin is considered property, a custodian will be necessary to remain in compliance with IRS standards.
Many individuals and investors are unaware of their accessibility to options that provide them with control over the IRA investments. If a substantial amount of your life savings are locked up in a retirement account this can provide a great opportunity to make an investment in a non-traditional investment vehicle.
Nobody can predict the future value of any investment. At this juncture, bitcoin and all other cryptocurrencies are speculative.
How It Works
A Cryptocurrency IRA works very much like traditional IRAs; you rollover your IRA stocks or other securities and use those funds to buy cryptocurrencies.
As with IRAs or 401Ks in precious metals or collectibles, a bitcoin IRA is handled through a custodian. Since bitcoin IRAs and 401Ks are a recent development in the financial community, only certain custodians will handle them. Contact Camuso CPA to set up your Cryptocurrency IRA today with top tier professionals.
Follow this link for past articles regarding self-directed IRA’s:
Consult with a trusted CPA before executing investment decisions or initiating any substantial changes to your investment plans. CPAs know your finances better than any other advisor and should have the expertise and network to offer valuable, preemptive recommendations.
Investors and business owners of all types should look for an advisor that serves as a partner; an ideal CPA is a financial expert with companies within your industry that can provide ongoing financial and business advice when you need it most.
Camuso CPA PLLC’s focus and specialization delivers a unique perspective on best industry practices to provide the most value to clients.
Contact us today for cryptocurrency tax help and get your finances in order: https://www.camusocpa.com/contact/#/