Cryptocurrency Tax Considerations for Estate Planning
1. Classification of Cryptocurrency for Tax Purposes
Cryptocurrencies are treated as property by many tax authorities, including the IRS in the United States. This classification has a broad range of implications:
Capital Gains: Just like with stocks or real estate, buying and selling cryptocurrency can trigger capital gains taxes.
Estate Inclusion: For estate tax purposes, the fair market value of the cryptocurrency at the time of the owner's death is included in the estate's total value.
