You know the saying, there’s only two things guaranteed in life: death and taxes.
So when you die, what happens to your cryptocurrency?
For those who have planned ahead, someone will inherit those assets and have all the codes and keys necessary to access them.
So when your kids, or spouse, or whoever inherits your crypto, how much of a cut does the government take?
Cryptocurrency is Property
When someone inherits cryptocurrency, it’s treated as property. As such it’s taxed like other assets based on:
1. It’s value as of the date of death
2. Any gains from date of death (capital gains tax)
3. It’s amount (any amount over $11.4MM is taxed a 40% estate tax)
These federal taxes were nicely summarized by The Hustle:
I’m not a financial advisor or tax expert, and this information is based on the current laws.
Images for this article were created by The Hustle.
Do you have a plan for passing down your investments?