Which form, 4797 or 8949, should cryptocurrency traders choose to report their gains and losses?

3 answers

• Aysel DadashovaMar 26, 2025 · 8 months ago
  Cryptocurrency traders should choose between Form 4797 and Form 8949 based on the nature of their trading activities. Form 4797 is used for reporting gains and losses from the sale of business property, while Form 8949 is used for reporting gains and losses from the sale of investment property. If you are actively trading cryptocurrencies as a business, then Form 4797 would be the appropriate choice. However, if you are trading cryptocurrencies as an investment, then Form 8949 would be the right form to use. It's important to consult with a tax professional to determine which form is most suitable for your specific situation.
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• tung ngoJul 07, 2021 · 4 years ago
  When it comes to reporting gains and losses from cryptocurrency trading, it can be confusing to determine which form to use. Form 4797 is typically used for reporting gains and losses from the sale of business property, while Form 8949 is used for reporting gains and losses from the sale of investment property. However, the IRS has not provided clear guidelines on whether cryptocurrency trading should be considered a business or an investment. As a result, many cryptocurrency traders choose to report their gains and losses using both forms to ensure compliance. It's always a good idea to consult with a tax professional to ensure you are reporting your cryptocurrency gains and losses correctly.
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• Carlos NASSAKOUJul 18, 2025 · 4 months ago
  When it comes to reporting gains and losses from cryptocurrency trading, cryptocurrency traders should choose the form that aligns with their trading strategy and goals. Form 4797 is typically used for reporting gains and losses from the sale of business property, while Form 8949 is used for reporting gains and losses from the sale of investment property. If you are actively trading cryptocurrencies as a business and your primary goal is to generate profits, then Form 4797 would be the appropriate choice. On the other hand, if you are trading cryptocurrencies as an investment and your primary goal is long-term capital appreciation, then Form 8949 would be more suitable. Remember to consult with a tax professional to ensure you are making the right choice for your specific circumstances.
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