How to move Bitcoin and other cryptocurrencies without paying tax? With the authorities becoming more and more strict when it comes to booking profits on cryptocurrencies, many investors are finding it tough to move cryptocurrencies. Moreover, each and every time you sell cryptocurrencies or Bitcoin, you will have to incur hefty tax. The IRS is also asking the cryptocurrency exchanges to make the customers comply with the tax code.
According to the experts, still, there are a few ways in which you will be able to move Bitcoin as well as other cryptocurrencies without incurring the significant amount of tax.
Going by the partnership or corporation route:
According to the sec. 351 of the tax code, you will be able to move your assets to the corporation if you’re able to take stock against it. This will not incur you any tax. You can opt for an S corporation or you can opt for a C corporation. The corporation can be brand-new or you can use an older corporation.
There are some of the requirements which you have to face as well but they can be easily concluded.
Also, according to section 721 B, if you’re contributing to a partnership company, there will be no taxes once again. This ensures that you will be able to transfer Bitcoin as well as other cryptocurrency assets without paying the taxes.
You can also transfer cryptocurrencies and other crypto assets as gifts. This will not incur any tax as well. This will again ensure that you are able to transfer it quite easily. The problem here, however, is that if the recipient of the gift actually sells the assets, then there will be a tax.
Thus, whenever you’re looking to transfer your cryptocurrency Holdings as well as other assets on the blockchain, it is important to go through these 2 options. When you are able to go through with these 2 options, you will largely be able to avoid tax. Moreover, you will be able to transfer the cryptocurrency assets quite easily. This is the reason why you have to carefully plan the move of transferring the cryptocurrency assets. Once you are able to do that, it will be easier for you to avoid taxes to a larger extent. On the other hand, if you are directly completely liquidating the cryptocurrency assets, then there will be a hefty tax. This is the reason why you have to know how to transfer the cryptocurrency assets so that you are able to avoid the tax.
Your accountant will be able to assist you further. However, there are a few ways with the help of which you can save on taxes intermittently. Source: Cointelegraph https://cointelegraph.com/news/tax-free-ways-to-transfer-bitcoin-and-other-crypto-expert-take