US Internal Revenue Service: A taxable event that occurs when an investor controls financial income.
According to Forbes, a letter from the U.S. Internal Revenue Service dated April 9, 2021 further clarifies when crypto hard forks are taxable. This special document describes the BTC and BCH hard forks that took place in August 2017. As a tough match, BTC holders received the same price from BCH. Although the fork difficulty occurred on August 1, 2017, not all BTC holders could use BCH at the time. For example, Coinbase users will have to wait until January 1, 2018 to use BCH. Other exchange intermediary users may also have to wait days or weeks to withdraw their newly received BCH. The Notes explain that when investors take control of an asset acquired after tough competition (the ability to change money), they create tax situations, not when the energy curve actually occurs. Ahead of the October 2020 news, the IRS said taxpayers must report cryptocurrencies obtained through airdrops or hard forks.
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