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RE: LOOPHOLE for the New 2018 Tax Law that Taxes All Cryptocurrencies in US
Up until now, capital gains tax was only due when you CASHED IN your crypto for dollars or another fiat currency. But now EVERY crypto trade will be subject to a capital gains tax.
Every CPA I talked to said that all crypto trades has always been a taxable event. The tax bill clarified that like-kind does not apply to crypto which does NOT mean that it applied in the past! Nothing has changed except they made the words more easy to think about.
That is close. Not every trade is a taxable event. Investopedia defines taxable event as:
"A taxable event is any event or occurrence that results in a tax liability."
Since some crypto trades result in a loss, or a break even, they are NOT taxable events. I like to say that every crypto trade results in a bookkeeping event, but not every trade results in a taxable event.
The tax profession is sloppy when its practitioners incorrectly state that all crypto trades are taxable events.
As of today, I would not bet that the like-kind exchanges for crypto will hold up pre-2018, but the jury is still out on that case.