Just 3% of U.S. cryptocurrency investors had filed their taxes as of the end of March. By comparison, Americans overall have filed about 40% of individual returns expected this tax season.
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The report, from digital asset platform CoinTracker, said the main reason is that people generally don't know how their cryptocurrency activity affects their tax situation. When given a list of hypothetical tax scenarios, a whopping 97% got at least one wrong, showing many do not realize they need to, for example, pay taxes when trading one type of cryptocurrency for another or when using cryptocurrency to buy a good or service.
Users are apparently well aware of their lack of knowledge: not only have most not filed their taxes, 75% said they are not yet prepared to do so, and 74% desire more information on how to file their taxes.
"Surveys like this underscore the importance of ongoing education so that crypto users can file taxes more accurately and seamlessly, and save time and money," CoinTracker said in a statement.
Other studies point to similar confusion over cryptocurrency taxes. A recent report from cryptocurrency finance platform Gemini (see full story) said that a mean average of 21% of people across the world said that “The tax complexities of owning cryptocurrency have kept me from investing.” In the U.S., the area with the least tax uncertainty, 14% of respondents still said this; in the Middle East, the highest region, it was 30%.
Chris Gaetano is the technology editor for Accounting Today. He brings with him more than a decade of experience covering the accounting profession... Read full bio
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