The Internal Revenue Service has issued very few guidance regarding bitcoin taxes. It did, however, issue a statement in 2014 stating that cryptocurrencies will be treated as property for federal income tax reasons. The cryptocurrency may be classified as company property, investment property, or personal property depending on how it is handled. Whatever the kind of profit, cryptocurrency owners must keep track of their base. The transaction becomes taxable if bitcoin is used to exchange goods or services.
Taxable events include, for example, the selling of coins in return for fiat money, the exchange of coins for coins, cryptocurrency purchases, and bitcoin receipts for services. Bitcoin taxes is complicated, and people and companies must continue to follow new legislation.

The taxation of crypto assets varies by country, but generally treats them as property, investments, or taxable commodities. In the U.S., the IRS taxes cryptocurrencies as capital assets, meaning profits from selling, trading, or spending crypto are subject to capital gains tax, short-term (if held 1 year). Mining, staking, and airdrops are taxed as ordinary income at their fair market value. Similarly, the U.K. and Canada impose capital gains taxes on crypto disposals, while Germany offers tax-free status after a 1-year holding period. Some countries, like Portugal, exempt personal crypto transactions from taxes. Traders must maintain detailed records of transactions, including dates, amounts, and values, to ensure accurate tax reporting. Failure to comply can result in penalties or audits.