Crypto gambling is becoming an increasingly popular pastime amongst Hudson Valley residents, and for good reason too. This particular form of gambling perfectly combines America’s love for casinos with the increasing adoption and utilization of cryptocurrency. As it stands, around 28% of American adults have invested in crypto at some point in their lifetime and it is estimated that 85% have gambled at least once. With both sectors being so popular, it makes sense that crypto gambling has become as successful as it has. However, with so many Hudson Valley residents turning to crypto gambling as a form of entertainment, it is important they understand the tax implications that come with doing so.
The Benefits of Crypto Casinos
Crypto casinos, especially those that incorporate the most popular form of cryptocurrency, Bitcoin, are becoming increasingly popular among Hudson Valley residents. The reasons for this are many, but one of the most prominent is the similarities between investing in digital assets and wagering within casinos. This is due to the volatility of crypto, which refers to the tendency of digital assets to rise and fall in value over time. By making a bet on a crypto casino gamblers can make an additional bet on the digital asset they are using, in the hopes that it will increase over time. On top of that, many of the best Bitcoin casinos offer a generous amount of bonuses to their players, and also instant payouts which really make these sites stand out. (Source: https://www.pokerscout.com/casino/best-bitcoin-casinos/ )
How is Crypto Gambling Taxed?
It is necessary that Hudson Valley residents who make use of online crypto casinos know how they will be taxed when using these platforms. Tax is taken from crypto gambling in much the same way it is in more traditional forms of gambling. This means that any gambling winnings are considered taxable income and will therefore need to be reported on an individual’s income tax return.
Even though the IRS doesn’t yet directly address crypto gambling, these winnings must still be accounted for. Because of the possibility that crypto gambling may require players to make additional transactions, the amount of tax that they are expected to pay could be more than what is taken from the income of their job.
Keeping Records
Unlike your employer, casinos won’t withhold the money that needs to be paid as tax from your casino winnings. Instead, you’ll have to report it yourself. With that in mind, you’ll need to craft records of how many winnings you take in from crypto gambling sites during the year.
You’ll also need to make a note of any crypto you might have disposed of during the course of the year as you’ll have to pay capital gains tax on this. This form of tax is applied to the difference between your cost basis and what you earned when you sold or disposed of the crypto.
Finding the Forms
There are three different forms you might need to use when sorting out tax for your crypto gambling winnings. We advise you to take a look at these forms and assess whether they are relevant to your situation. They include Form 8949, Schedule D (form 1040), and Schedule 1 (form 1040)
Conclusion
Many Hudson Valley residents enjoy crypto gambling in their free time. Although using these platforms is designed to be enjoyable and winning is a great incentive to play, it’s important that gamblers don’t get carried away by their winnings and remember to keep tax payments in mind. If you have any problems filling out tax forms or calculating how much you owe, professionals can be hired to assist.
