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/biz/ - Business & Finance

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7763066 No.7763066 [Reply] [Original]

Need help on tax ambiguity.

For example, I buy 1 ethereum for 200 and hold. Then a few months later, I want some neo. So I buy 1 ethereum for 300 and immediately exchange it for neo.
Do I have to pay taxes on the gains on the initial ethereum I bought for 200, or the ethereum I bought a few months later for 300?

>> No.7763496

>>7763066
I'm no expert but I think you won't have to pay taxes on the trade from eth to neo. You bought eth at 300, didn't realize any gains, then traded for neo. So you basically just bought neo.

>> No.7763633

>>7763066
Depends on whether you use the FIFO (first in first out) or LIFO (last in first out) method of accounting. But whichever method you use, consider the consequences very carefully, because you may not be able to change it later.

>> No.7763797

>>7763633
Label each transaction with its own taxlot code. Optimize the sales in accordance with the TaxMin approach...

Look up Betterment's TaxMin approach, it'll take you some programming skills to develop one but when it's done then you could run and have it optimize your sales... And just file it accordingly.