You can offset your capital gains by donating cryptocurrency to crypto-friendly nonprofits. CoinTracking recently partnered with a cryptocurrency charity called The Giving Block. Keep reading to find out how it works as well as how you can donate cryptocurrency to offset your capital gains taxes.
Why should I donate cryptocurrency?
In the US, the IRS classifies cryptocurrency as property, making it the most tax efficient way to support your favorite causes. When you donate cryptocurrency to a registered charity, you pay no capital gains tax and you can write your donation off on your taxes. Because of that, most financial advisors tell their clients to donate their most highly appreciated assets first. In many cases, this turns out to be cryptocurrency.
This is also true in many other countries around the world like Germany where donations are also tax deductible. In any case, after making a donation through The Giving Block widget, you will automatically receive a tax receipt for your records.
How does it work?
Below is a quick video demonstrating how you can make a donation to a crypto-friendly nonprofit today and get an automatic tax receipt.
Which nonprofits can I donate cryptocurrency to?
The Giving Block works with over 30 crypto-friendly nonprofits that accept Bitcoin, Ether, Litecoin, Bitcoin Cash, Zcash and GUSD donations. After donating, you’ll automatically get a tax receipt. In the crypto industry, the Giving Block works with leaders like Gemini, Brave and the Blockchain Accountant Association to make accepting cryptocurrency donations easier.
Which nonprofits should I support?
Beyond the tax benefit, some nonprofits are helping spread crypto adoption. Multi-billion dollar nonprofits like Save the Children are not only accepting cryptocurrency donations – they’re also talking about it to millions of their followers.
The nonprofits supported by The Giving Block don’t just accept crypto, they actively fundraise it. There’s a big difference. Before The Giving Block started, less than 10% of nonprofits who received crypto donations talked about it, and less than 50% of nonprofits who received crypto listed crypto as a donation option on their websites. The Giving Block’s nonprofits talk about crypto year-round, normalizing the technology and driving crypto adoption. They get more donations, crypto adoption increases; win-win.
So when you go to file your taxes this tax season, would you rather donate your appreciated cryptocurrency to your favorite cause or pay the IRS? Pick a side. The choice is yours. Donate today and save on taxes.
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CoinTracking can help you in your crypto tax journey:
Gains calculations, according to 12 accounting methods (e.g., FIFO, LIFO, HMRC, ACB).
Fully compliant Tax Reports worldwide.
If you need personalized help reviewing your transactions or preparing your US tax returns, check out our CoinTracking Full Service. CT Full Service is provided by a team of crypto tax professionals led by Sharon Yip, an expert CPA. Follow our weekly AMAs on Twitter where Sharon Yip answers your crypto tax questions.
Disclaimer: All the information provided above is for informational purposes only and should not be considered as professional investment, legal, or tax advice. You should conduct your own research or consult with a professional financial advisor when investing.
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