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RE: Valuing Steem Rewards As Taxable Income Is A Vast Overstatement Of Tax Liability - Part 1

in #taxes7 years ago

It's taxable as ordinary income when you receive the rewards regardless of whether you convert to fiat. It later taxed again (assuming it has gone up in value since it was awarded) as capital gains when you trade it for something else of value. Whether that "something else" is a good, a service, a Visa card or fiat doesn't matter.

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Ah, I see. Thanks for the info!

Loving your contributions to this thread, Sean. Excellent stuff.

On this: what about trades in crypto between the time of receiving rewards in Steem and cashing out in fiat, if trading/investing in other tokens?

i.e. take Steem, trade over the course of the year for a few dozen other coins before converting some to withdraw in fiat... would precise records need to be kept for every trade in between, and capital gains/losses calculated and paid on each of those single trades, regardless of that it’s still all kept in crypto?

(To my understanding, the answer is YES - though I’m curious as to whether with your insight, there may be any other possibility, and what specific terminology of the protocol you use in the answer.)