What is the impact of the wash sale rule on cryptocurrency gains?

1 answers

• May 05, 2022 · 3 years ago
  The wash sale rule is a tax provision that affects cryptocurrency gains. It prevents investors from claiming a loss for tax purposes if they sell a security, including cryptocurrencies, at a loss and repurchase the same or a substantially identical security within 30 days. This means that if you sell a cryptocurrency at a loss and buy it back within 30 days, you cannot deduct the loss from your taxable income. The wash sale rule aims to prevent investors from manipulating their tax liability by generating artificial losses. It's important for cryptocurrency investors to be aware of this rule and consider its implications when planning their trades.
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