Andrea Kramer Andrea Kramer

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Andrea (Andie) S. Kramer has a sophisticated and unique multi-disciplinary legal practice that covers all aspects of financial transaction, derivatives, and cryptocurrency, with a focus on taxation, regulation, contract design, trading operations and documentation. Andie helps clients successfully resolve difficult legal situations, including federal and state regulatory matters, adversarial proceedings, and tax planning and compliance issues while addressing interrelated business objectives, regulatory and legal requirements, and public policy. Read Andrea Kramer's full bio.

Are Crypto Loans Taxed as Loans?


By on Sep 18, 2020
Posted In IRS Guidance, Tax Reform

Transactions involving the borrowing and lending of units of virtual currency (or crypto loans) are increasing in number and type. Lacking Treasury or IRS guidance with respect to crypto loans, potential tax issues that arise from these transactions must be analyzed and understood in accordance with broad, general tax principles established by case law and...

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Taxation of Virtual Currency Staking Activities


By on Sep 16, 2020
Posted In IRS Guidance, Tax Reform

Stakers—taxpayers involved in proof of stake (PoS) validation of blockchain transactions—are operating in uncharted tax waters. Treasury and the IRS have provided no guidance regarding when or whether staking rewards are included in taxable income. This article reviews various considerations that may help stakers document activities, rewards and expenses that support their federal and state...

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Taxation of Virtual Currency Mining Activities


By on Sep 11, 2020
Posted In IRS Guidance, Tax Reform

Proof of work (PoW)—one of the consensus methodologies through which blockchain (digital ledger) transactions can be validated—relies on data miners whose mining activities involve solving complex mathematical calculations. This article discusses key tax issues for miners and the IRS’s preliminary views involving taxation of Bitcoin PoW mining activities. Access the full article here.

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Can Virtual Currency Traders Elect into Special Rules that Allow Current Deductions for Trading Losses?


By on Sep 4, 2020
Posted In IRS Guidance, Tax Reform

Traders in virtual currency seeking to deduct trading losses and avoid application of the capital loss limitations would want to elect into the special tax rules found at IRC § 475(f). However, such taxpayers should analyze the definitions of “securities” and “commodities,” determine whether they are eligible for either of the trader elections, and consider...

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When Can Bitcoin Positions Be Taxed as Mixed Straddles Subject to the Special Mixed Straddle Rules?


By on Aug 31, 2020
Posted In IRS Guidance, Tax Reform

Taxpayers who enter into offsetting positions in actively traded personal property where one or more—but not all—of the positions making up a straddle are taxed as section 1256 contracts (while another offsetting position is not a section 1256 contract) are subject to the mixed straddle rules. Potential adverse consequences can be magnified or made more...

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Special Tax Rules Apply to Bitcoin Futures and Options


By on Aug 24, 2020
Posted In IRS Guidance, Tax Reform

Special tax rules require taxpayers to treat gains on certain virtual currency positions as taxable even though they still hold their positions. These rules apply to futures and options that qualify as section 1256 contracts, which is potentially relevant to taxpayers buying, selling and holding Bitcoin futures and options, as well as Ether futures and...

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When Virtual Currency Positions Are Subject to the Wash Sales Rule


By on Aug 19, 2020
Posted In IRS Guidance, Tax Reform

Under the wash sales rule, taxpayers cannot deduct a loss on the sale of stock or securities if the taxpayer purchases the same or substantially similar assets a short time before or after the sale that triggered the loss. This article examines possible application of the wash sales rule to virtual currencies. Access the full...

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What Is the Significance of Virtual Currency Not Being Taxed as Currency?


By on Aug 14, 2020
Posted In IRS Guidance, Tax Reform

Virtual currencies are not currently accepted as the legal tender or “fiat” currency of any country. In the United States, the IRS has stated its view that convertible virtual currency is property, subject to the general tax rules that apply to property, and is not foreign currency. As such, virtual currency does not qualify for...

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Can a Virtual Currency Position Be Treated as a Security for Tax Purposes?


By on Aug 12, 2020
Posted In IRS Guidance, Tax Reform

Some virtual currency units and positions are treated as securities by the Securities and Exchange Commission (SEC) and US courts. The Internal Revenue Service (IRS), however, has told taxpayers that it views convertible virtual currency as property, not foreign currency, for federal tax purposes. Lacking clear guidance from the IRS or the Department of the...

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Can a Virtual Currency Position Be Treated as a Commodity for Tax Purposes?


By on Aug 7, 2020
Posted In IRS Guidance, Tax Reform

Some virtual currency units and positions are treated as commodities by Commodity Futures Trading Commission (CFTC) and US courts. The IRS has told taxpayers that it views convertible virtual currency as property, not foreign currency, for federal tax purposes. Lacking clear guidance from either the Internal Revenue Service (IRS) or the Department of the Treasury,...

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