What tax implications should I consider when investing in cryptocurrencies?

1. Capital Gains Tax: Cryptocurrency profits and losses are subject to capital gains taxes, which must be reported to the IRS.

2. Self-Employment Tax: Individuals who receive income in the form of cryptocurrency are required to pay self-employment tax.

3. Foreign Account Tax Compliance Act (FATCA): All U.S. taxpayers must report information about their foreign financial accounts and investments, including cryptocurrencies held in foreign exchanges, to the IRS.

4. Exchange Reporting Requirement: Cryptocurrency exchanges are required to submit Form 1099-K to customers who have had more than 200 transactions and $20,000 in total sales in their accounts during the year.

5. Sales Tax: Depending on where you live and where you purchased your cryptocurrency, you may be required to pay sales tax when you buy or sell it.

6. State Tax: Depending on where you live, your state might require you to pay income tax on any cryptocurrency gains or earnings.