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Despite the detailed information provided here, please be mindful that immigration matters are often complex and require experienced legal advice. The information on this webpage should not be construed as legal advice for your specific issue.
An immigrant petition is a filing to obtain lawful permanent residency in the United States, whereas a non-immigrant petition is a filing to obtain temporary status in the United States (usually based upon employment).
A green card is a slang term for “lawful permanent resident” card. This card once obtained is proof of U.S. residency. There are several ways that one can obtain a green card, either through family, employment, or other means.
Currently, green cards are valid for 10 years, or two years in the case of a conditional resident. The green card must be renewed before it expires.
No. It may take from three months to two years to complete the green card process.
What are the options for immigration if I would like to sponsor my spouse who is a foreign national?
How the spouse can immigrate into the United States depends upon factors including (1) if the person is presently in the United States and can simply adjust status or abroad and requiring Consular Processing of the immigrant visa; (2) whether the petitioner is a Lawful Permanent Resident or U.S. Citizen; (3) the petitioner meets the income requirements for sponsorship. Contact an immigration attorney from to review all requirements.
You can sponsor the individual for a Fiancé(e) Visa Petition, or you can marry them in that country or a third country and file a spousal petition. Each of these options has different impacts on the application to be filed, evidence to be compiled and when the person can enter the U.S. Contact an immigration attorney to formulate the best strategy for your unique circumstances.
The person may either come to the United States on a permanent basis or a temporary basis. How the family member can immigrate or visit the United States depends on your specific circumstances, which can be examined by an immigration attorney. Immigration for family members often depends upon whether the person is recognized as an immediate relative in which case a visa is available for the individual to immigrate to the U.S. Sometimes visa wait times for non-immediate relatives can be quite delayed (some for decades) and our Immigration Attorneys will be able to assist in formulating strategies around these wait times.
Eligibility depends upon several factors. Generally, a person will have had to be a lawful permanent resident for 5 years to apply (or 3 years based upon marriage to a U.S. Citizen). Contact an immigration attorney to formulate the best strategy for your unique circumstances and to give you peace of mind that you are correctly following all procedures.
An individual born in the United States is automatically a U.S. citizen. A foreign national who wishes to be a U.S. citizen must go through the process of naturalization. To naturalize, an individual must meet the following criteria: He or she must be admitted into the U.S. as a lawful permanent resident (LPR), live in the U.S. for at least five continuous years, reside in the state in which the petition is being filed for at least three months immediately prior to filing for U.S. citizenship, have a physical presence in the U.S. for a total of at least half of the period of required continuous residence, have continuous residence in the U.S. from the date of filing the naturalization application to the date of being sworn in as a U.S. citizen, have the basic ability to read, write, and speak English, have a basic understanding of U.S. history and government, have good moral character consistent with the values of the U.S. constitution, and be at least 18 years of age.
Being an LPR entails getting a green card. A green card is issued to all permanent residents as proof that they are legally authorized to reside in the United States. A green card can be used to show employment eligibility in the U.S as well as to obtain a Social Security Card.
A person seeking to become a U.S. citizen should obtain an immigrant visa. Most immigrants receive visas in the family-based or employment-based visa categories. Coming to this country based on family often requires a U.S. citizen to file an immigrant visa petition for a spouse, child, parent, or sibling. Another route is that a U.S. lawful permanent resident (i.e., green card holder) can file an immigrant petition for a spouse or an unmarried son or daughter. Employment-based immigration involves a U.S. citizen sponsoring certain workers for permanent jobs. U.S. law also permits prospective immigrants to sponsor themselves in limited fields. Additionally, U.S. law provides many specific immigrant categories, including an investor visa.
U.S. immigration law is complex. Having an immigration attorney can make the immigration process go more smoothly and give you peace of mind that you are correctly following all procedures. Evidence gathering and presentation often will have a significant impact on the case. By hiring an immigration attorney, you will have an adviser who is experienced in immigration law and who will personally handle your immigration case. We pride ourselves in providing experienced and affordable immigration legal representation and being your immigration partner.
Spouses of U.S. Citizens who have resided unlawfully in the United States for at least 180 days qualify. Undocumented individuals who have resided unlawfully in the United States for at least 180 days and who are: – the sons and daughters of U.S. Citizens; and the spouse and sons or daughters of lawful permanent residents.
The United States is a country that truly believes in the words on the Statue of Liberty which say: “Give me your tired, your poor, your huddled masses yearning to breathe free.” Asylum and Temporary Protected Status are two examples of relief that the United States provides. By consulting with an immigration attorney, you will have an adviser who is experienced in immigration law and will provide you an honest assessment of your eligibility for relief and who will personally handle your immigration case.
If you are still in the abusive relationship, get out. There are several Domestic Violence shelters and agencies that can assist you. Under the provisions of the Violence Against Women Act (VAWA), the U.S. provides visas for men and women and their children who are the victims of an abusive relationship. By consulting with an immigration attorney, you will have an adviser who is experienced in immigration law and will provide you an honest assessment of your eligibility for relief and who will personally handle your immigration case.
Yes, as a person living in the United States you should report criminal activity to the appropriate authorities. Often by cooperating with the police you may become eligible for a visa based upon your victimization and cooperation. Contact an immigration attorney with to discuss eligibility.
Whether you can employ a foreign worker depends upon the type of employment and the alien’s status and qualifications. Please contact an immigration attorney to discuss your company’s sponsorship of employment immigration visas for the temporary hiring of professional/skilled workers under the H-1B visa program and unskilled workers under the H-2B visa programs as well as TN visa program designated specifically for Canadian & Mexican workers.
Premium Processing is a special USCIS program that provides significantly faster processing in exchange for an additional processing fee. For an additional fee, USCIS guarantees action on your case within 15 calendar days on the following types of visa petitions or applications: H-1B, H-2B, H-3, O, P, Q-1, E-1, E-2, L and TN.
You must wait for approval of the petition. Exclusion may apply in the special case if you are petitioning for an H-1B non-immigrant, and the employee is already in the United States under H-1B classification.
Waivers are often necessary due to Unlawful Presence or misrepresentation to the government. Often the government gives very short deadlines for the submission of the waiver, thus it is important to hire the right immigration attorney. Please contact an attorney to discuss the waiver you need and your eligibility.
You must attend all court hearings or risk an order of deportation. If you do not already have an attorney, you should contact an immigration attorney to determine what relief you may have available to you and to do a review of your documentation.
Criminal charges or convictions that may appear minor could have dire consequences on your status and you should contact an immigration attorney to discuss how this issue may affect your status.
An immigration attorney cannot assist you with this process. You will need to work with the SEVIS approved school that you wish to attend.
We recommend that you visit the Department of State website at www.travel.state.gov and/or the United States Citizenship and Immigration Services website at www.uscis.gov. Government websites end with .gov and those ending with .com are not legitimate government websites. Should you have more specific requests please contact our office.
Applicants for visas (especially visitor visas) must show that they qualify for the visa. Section 214(b) presumes that every visitor visa applicant is an intending immigrant. To overcome this presumption an applicant must demonstrate that they have nonimmigrant intent.
Applicants for visas (especially visitor visas) must show that they qualify for the visa. Section 214(b) presumes that every visitor visa applicant is an intending immigrant. To overcome this presumption an applicant must demonstrate that they have nonimmigrant intent.
A denial under this section of law is because the consular officer determined that the evidence submitted in support of the application was insufficient to demonstrate eligibility for the visa. If you have been denied for this reason, you should consult with one of our attorneys to determine your next course of action.
A denial under this section of law is because the consular officer determined that the evidence submitted in support of the application was insufficient to demonstrate eligibility for the visa. If you have been denied for this reason, you should consult with one of our attorneys to determine your next course of action.
Individuals seeking to enter the United States for medical treatment require visitor visas. Before applying you may wish to consult with an immigration lawyer.
As a Permanent Resident you should be careful and should not register to vote or vote without first consulting an immigration lawyer. You can only vote in local and state elections that do not require proof of U.S. citizenship and the consequences of unlawful voting could result in deportation (removal) proceedings. If you have registered to vote or voted and are not a United States Citizen, our experienced immigration lawyers can provide a consultation to determine your options.
The first step that you must determine is that person’s immigration status. The next step is to consult with an immigration lawyer to determine if establishing the business can provide the person status or if there are any concerns for the business.
No. The landlord should not ask about your immigration status since no state or federal law currently requires them to do so. All local ordinances requiring such action has been held up in court.
It is important that you respond timely to the request with the desired information. The attorneys at AlChaer Law Firm would be happy to set up a consultation with you to determine the course of action for the response.
Many times the government improperly concludes that a case is deniable. Our experienced attorneys have successfully resolved cases in which the government intends to deny the case. While results may vary depending upon fact patterns and a case cannot always be resolved, a consultation with an attorney may turn up another avenue of relief.
Pennsylvania publishes the requirements under How to Apply for a Texas Driver License (https://www.dps.texas.gov/section/driver-license/how-apply-texas-driver-license). Other states have similar publications.
The Social Security Administration published a guide to Social Security Numbers for Noncitizens on its website or you may call SSA toll free at 1-800-325-0778 or 1-800-772-1213 (for the deaf or hard of hearing).
Lawful status means that a foreign national has an unexpired Form I-94 that was issued by immigration authorities, and they are complying with the conditions on their specific visa. If they do not comply with those conditions, they will not have lawful status. An H-1B visa holder who does not work for the employer that sponsored their petition, for example, will be considered to have fallen out of status. By contrast, a period of authorized stay defines a time during which a foreign national does not have lawful status but has permission to stay in the U.S. for a certain reason. This typically happens when a foreign national has applied to extend or change their status while their current status remains valid, but USCIS does not make a decision on their application before their status expires. A foreign national is unlawfully present in the U.S. only if they have neither lawful status nor a period of authorized stay.
Receiving a deportation order does not necessarily mean there is no hope to stay in this country. An individual can challenge, appeal, or otherwise seek to stay a deportation order. United States Citizenship and Immigration Services (USCIS) handles deportations and removal proceedings. USCIS sends an individual a Notice to Appear, which will contain the details of why the proceeding has been initiated. The notice will also provide the date of the first hearing. The initial hearing is procedural, and the individual will receive information about his or her rights. At the end of the hearing, an evidentiary hearing is set.
The evidentiary hearing is when a federal immigration judge will hear the evidence against the individual. The government must show through clear and convincing evidence that the individual is removable from the United States. The individual will be able to present evidence, such as documents and witness testimony, in his or her defense. If your claim is denied, you can file an appeal with the Board of Immigration Appeals (BIA).
Yes, entrepreneurs who make an investment in a commercial enterprise in the United States can apply for a green card through an EB-5 Investor visa. The investment must create or preserve at least 10 permanent full-time jobs for qualified U.S. workers. Every year, USCIS can authorize up to 10,000 visas for eligible entrepreneurs. A commercial enterprise refers to a for-profit entity formed for the ongoing operation of a lawful business. To be eligible for an EB-5 visa, the entrepreneur must invest a minimum of $800,000 in a targeted employment area (rural or high unemployment area) or $1,050,000 anywhere in the United States.
There are three main types of visas that a student can pursue: F Student Visas, M Student Visas, and J Visas for Exchange Visitors.
Employees who are residing and working in the United States on certain types of employment visas may be able to bring their families to the United States on temporary visas that last for the same duration as the principal employment visa. U.S. citizens and LPRs can seek to bring their family members to the U.S. permanently.
An employer can sponsor a foreign citizen to work and live in the United States through a work visa. There are a number of work visas that an employer can sponsor, including the H-1B, L, and O visas. This means that in order to obtain these types of visas, you must first apply for a job and be offered a position by a U.S. employer.
Citizens of foreign countries who wish to enter the United States temporarily for a vacation must obtain a non-immigrant B-2 visa. To qualify for a B-2 visa, an individual must establish that the purpose for the trip is tourism, pleasure, or visiting, that the person has a permanent residence in a country other than the United States to which he or she intends to return, that the person has connections to his or her home country in the form of a job, property, or family, that the person is not arriving in the U.S. to seek employment or partake in business activities for the advantage of a U.S. employer, and that the person has enough financial resources to cover the expenses of the trip. The duration of time that a person will be allowed to remain in the U.S. on a B-2 visa will be decided by the immigration officer at the port of entry. Generally, the maximum amount is six months.
All types of contracts contain the same elements. The parties must have the capacity to enter into a contract. They must be mentally and legally able to agree to the contract terms. There must have been mutual agreement between all parties. Parties indicate agreement by offer, acceptance, and consideration. The offer is the subject of the contract, acceptance is approval of the offer, and consideration is the exchange of value for the services or goods.
Not always. Binding contracts can be written or oral, but a few types must be written to be valid. These include:
- Documents related to marriage, including prenuptials
- Transfers of real estate
- Contracts that will take longer than one year to complete
- Agreements to pay another person’s debts
- Contracts for the sale of goods over $500
- Transfers of personal property at the death of one party involved
Construction contracts are often in writing because they involve subcontracting. The prime contractor contracts with the homeowner, so there is a primary document to bill the subcontractors.
Independent contractor agreements for goods or services are like any other type of business contract. It’s always best to have an agreement for an exchange of money in writing.
A written contract allows the parties to understand their obligations under the contract. If there are issues later, a written document provides evidence of the parties’ negotiations and their final agreement. In court, contract law requires the judge to look at the “four corners of the contract” if there is a dispute. There are limits on other evidence outside of the written contract, called parole evidence, that can be introduced in a contract law case.
The contracts that must be in writing are most often the subject of court cases. It’s always a good idea to have any exchange of goods or services for money in writing, even if it’s just the neighbor kid mowing your lawn.
An illegal contract is either:
- A contract where the subject matter itself is illegal. For example, a contract to purchase illegal narcotics is not legal.
- A contract that requires illegal activities to complete the terms. A contract that does business with a nation under federal government sanctions would be such a contract.
Illegal contracts are unenforceable, even if they are otherwise legally written. The courts will not enforce a contract containing illegal subject matter or terms.
Contracts may be legal on their face but void in reality. That is, they cannot be legally enforced because of some flaw in their execution. Common reasons to void a contract include:
- Lack of capacity on the part of one party
- Fraud or misrepresentation
- Unconscionable or unfair terms
- Impossibility or impracticability
A non-disclosure agreement (NDA) is a type of voluntary contract. NDAs appear in employment contracts and intellectual property law to protect trade secrets and confidential information.
Many states have banned or restricted NDAs, which are difficult to enforce in court. Most NDAs are enforceable when they involve specific confidential information or are time-limited.
What is a breach of contract?
A breach of contract occurs when one party fails to perform its obligations under the contract. The nature of the breach depends on the type of contract.
- Failure to complete obligations on time: For instance, a contractor could fail to finish building a roof by a specific date.
- Failure to abide by the terms of the contract: The contract specified the delivery of five tons of green grapes, and the shipper delivered three tons of red grapes.
- Failure to perform on the contract at all: You hired someone to take photos on your wedding day, and they never showed up.
All of these are breaches of contract. Some kinds of contracts have specific remedies for breach of contract. In commercial shipping contracts, the non-breaching party may have a certain number of days to demand a correction. The Uniform Commercial Code (UCC) governs these contracts.
When a party breaches a business contract, the non-breaching party can sue to recover damages.
All states have statutes of limitations for breach of contract claims. In most states, the statute varies depending on the nature of the contract. The statute can be as long as 10 years for written contracts and as short as two years for oral contracts. You should contact a contract law attorney as soon as possible in case of a breach.
The non-breaching party has two types of remedies. Monetary damages are the payment of the amount the non-breaching party lost due to the breach. Equitable or injunctive relief occurs when the court orders the breaching party to do something, usually canceling the contract.
The most common remedies after a breach are:
- Restitution: The breaching party must “make whole” the non-breaching party by paying them the money they lost due to the breach. This can get quite complicated. For instance, suppose you hired a wedding photographer for $100, and they never showed up. You made some emergency phone calls and found another photographer who charged $200. You can sue the first photographer for the $100 you paid them and the $200 you had to pay the emergency photographer.
- Punitive damages: These are seldom seen in contracts cases. Judges award these when the breaching party’s behavior is unusually egregious or reckless.
- Nominal damages: These are awarded when there was a breach, but the non-breaching party suffered no material harm.
- Rescission: Rescission means the judge cancels the contract and terminates the business relationship. The parties are to be restored to the position they would have been in had the contract not been made. Rescission and restitution are often ordered together.
- Specific performance: This is seldom granted for breach of contract cases. It is only granted when no other relief is possible, and the subject of the contract is unique. Real estate, original artwork, and custom goods are typical subjects for specific performance. Parties cannot receive specific performance for breach of service contracts.
A memorandum of understanding (MOU), similar to a letter of intent, is a non-binding agreement that memorializes the agreements between parties during negotiations. Businesses write the MOU after a letter of intent. Its purpose is to obtain the signatures and approvals needed for the contract.
In large businesses and corporations, a contract may undergo many stages and departments before finalization. The MOU ensures that everyone who needs input has a chance to give it before writing and signing the contract.
The Small Business Administration (SBA) assists businesses seeking contracts with other government agencies. Many federal agencies, such as the Department of Defense, offer procurement contracts to private sector companies.
Some types of businesses can bid on government contracts. Small business programs require federal agencies to open their bidding process to SBA-designated companies, including:
- Small, disadvantaged businesses (SDB): An SDB is one owned and operated by someone recognized as a socially disadvantaged person. The SBA qualifies small businesses for placement on this list.
- Women-owned businesses: The business must be at least 51% owned and operated by women and qualify as a small business by the SBA.
- Veteran-owned businesses: Service-disabled veterans qualify for assistance under SBA and VA programs.
The System for Award Management (SAM) allows small businesses to self-certify and register for assistance programs and federal contracts.
If you have any questions or concerns about business contracts, schedule a consultation with a contract attorney at AlChaer Law Firm.
An acquisition occurs when one company buys (or otherwise acquires) another company’s assets or stock. A merger occurs when two companies come together to form a new company.
To consult with an experienced business law lawyer today, call 501-920-5242
In short, taxes. The majority of large, publicly held corporations are C corporations. Some corporations are able to eligible to file an election (Form 2553) that will let the corporation be taxed under rules that are more like that of an LLC. Corporations that use this type of taxation are S corporations. Only certain corporations meet the tax requirements to become S corporations. If C corporations pay their shareholders dividends, the corporation will face double taxation. A C corporation will pay taxes on its profits before paying out its dividends to the shareholders, and the shareholders will then have to pay taxes when filing their individual tax returns. S corporations are not subject to double taxation as long as the requirements are met, and the shareholders are protected from corporate debts.
Business Law (also known as Commercial Law) encompasses many different smaller areas of law, all concerning the formation, operation, and sale or closing of a business.
Business law utilizes a wide array of legal areas, including (but not limited to):
Real Estate Law
Intellectual Property Law
Contract Law
Tax Law
Bankruptcy Law
Employment & Labor Law
Estate Planning & Wills
While Estate Planning & Wills might look out of place on the above list, businesses (especially those that are family-owned & operated) often need to make provisions for a clear and relatively smooth transition in ownership from one owner to another upon the death of the current owner.
Corporations are business entities that protect their shareholders by allowing limited liability so that the assets they invest in the business tend to be the only assets placed at stake, leaving personal assets of the shareholders safe from any losses the corporation may incur. Corporations are composed of three different types of people, with different levels of involvement. There are the shareholders, who vote on major corporate changes and elect directors. Directors are responsible for managing the business overall and hire the CEO and other corporate officers. The CEO and the corporate officers oversee the business’s everyday operations.
While partnerships and joint ventures share similarities, their goals are different. Where a partnership is a business entity that has two or more owners, a joint venture occurs when two (or more) business entities come together for a limited time for a specific goal.
Before anything else, consider what type of business entity is right for the business type. There are sole proprietorships, partnerships, corporations, and limited liability corporations (LLCs). The size and type of business being conducted will likely help determining which type of business entity will be the best fit. There are different advantages and disadvantages to each type of business entity. Allocation of profits and losses among the owners is another concern if the business is going to have more than one owner. Then there is also the matter of determining how much employees are to be paid and drafting any types of employment agreements employees are to sign upon accepting employment with the company. All of these decisions can have effects that last throughout the life of the business, so it is important to make the right ones from the start. Contact an attorney experienced in Business Law today for assistance in determining the right business entity, drafting necessary documents, and answering difficult questions.
It depends. A sole proprietorship is the simplest form of business, that much is clear. Sole proprietorships are, by name and definition, owned by only one individual. Unlike a corporation, a sole proprietorship is not a legal entity. Therefore, it is not a taxable entity. Legally, the business owner is the sole proprietorship. The owner reports the business’s profits and losses on their own annual tax return. The biggest advantage to a sole proprietorship is that all profits go directly to the owner. Conversely, the biggest disadvantage is that all debts are the responsibility of the owner.
It can’t be recommended enough. While it is legal to start a business without one, an attorney experienced in Business Law and Commercial Litigation can be an incredibly valuable asset. An attorney can help determine which type of business entity is the most suitable, help draft contracts and articles of incorporation, help obtain necessary permits and licenses, and more. Just the benefit of having someone there to respond when questions or issues come up out of the blue cannot be understated. An experienced attorney is one of the best investments a business owner can make.
A1. Virtual currency is a digital representation of value, other than a representation of the U.S. dollar or a foreign currency (“real currency”), that functions as a unit of account, a store of value, and a medium of exchange. Some virtual currencies are convertible, which means that they have an equivalent value in real currency or act as a substitute for real currency. The IRS uses the term “virtual currency” in these FAQs to describe the various types of convertible virtual currency that are used as a medium of exchange, such as digital currency and cryptocurrency. Regardless of the label applied, if a particular asset has the characteristics of virtual currency, it will be treated as virtual currency for Federal income tax purposes.
A2. Virtual currency is treated as property and general tax principles applicable to property transactions apply to transactions using virtual currency. For more information on the tax treatment of virtual currency, see Notice 2014-21. For more information on the tax treatment of property transactions, see Publication 544, Sales and Other Dispositions of Assets.
A3. Cryptocurrency is a type of virtual currency that uses cryptography to secure transactions that are digitally recorded on a distributed ledger, such as a blockchain. A transaction involving cryptocurrency that is recorded on a distributed ledger is referred to as an “on-chain” transaction; a transaction that is not recorded on the distributed ledger is referred to as an “off-chain” transaction.
A4. Yes. When you sell virtual currency, you must recognize any capital gain or loss on the sale, subject to any limitations on the deductibility of capital losses. For more information on capital assets, capital gains, and capital losses, see Publication 544, Sales and Other Dispositions of Assets.
No. If your only transactions involving virtual currency during 2020 were purchases of virtual currency with real currency, you are not required to answer yes to the Form 1040 question.
A6. If you held the virtual currency for one year or less before selling or exchanging the virtual currency, then you will have a short-term capital gain or loss. If you held the virtual currency for more than one year before selling or exchanging it, then you will have a long-term capital gain or loss. The period during which you held the virtual currency (known as the “holding period”) begins on the day after you acquired the virtual currency and ends on the day you sell or exchange the virtual currency. For more information on short-term and long-term capital gains and losses, see Publication 544, Sales and Other Dispositions of Assets.
A7. Your gain or loss will be the difference between your adjusted basis in the virtual currency and the amount you received in exchange for the virtual currency, which you should report on your Federal income tax return in U.S. dollars. For more information on gain or loss from sales or exchanges, see Publication 544, Sales and Other Dispositions of Assets.
A8. Your basis (also known as your “cost basis”) is the amount you spent to acquire the virtual currency, including fees, commissions and other acquisition costs in U.S. dollars. Your adjusted basis is your basis increased by certain expenditures and decreased by certain deductions or credits in U.S. dollars. For more information on basis, see Publication 551, Basis of Assets.
Yes. When you receive property, including virtual currency, in exchange for performing services, whether or not you perform the services as an employee, you recognize ordinary income. For more information on compensation for services, see Publication 525, Taxable and Nontaxable Income.
A10. Yes. Generally, self-employment income includes all gross income derived by an individual from any trade or business carried on by the individual as other than an employee. Consequently, the fair market value of virtual currency received for services performed as an independent contractor, measured in U.S. dollars as of the date of receipt, constitutes self-employment income and is subject to the self-employment tax.
A11. Yes. Generally, the medium in which remuneration for services is paid is immaterial to the determination of whether the remuneration constitutes wages for employment tax purposes. Consequently, the fair market value of virtual currency paid as wages, measured in U.S. dollars at the date of receipt, is subject to Federal income tax withholding, Federal Insurance Contributions Act (FICA) tax, and Federal Unemployment Tax Act (FUTA) tax and must be reported on Form W-2, Wage and Tax Statement. See Publication 15 (Circular E), Employer’s Tax GuidePDF, for information on the withholding, depositing, reporting, and paying of employment taxes.
A12. The amount of income you must recognize is the fair market value of the virtual currency, in U.S. dollars, when received. In an on-chain transaction you receive the virtual currency on the date and at the time the transaction is recorded on the distributed ledger.
A13. If, as part of an arm’s length transaction, you provided someone with services and received virtual currency in exchange, your basis in that virtual currency is the fair market value of the virtual currency, in U.S. dollars, when the virtual currency is received. For more information on basis, see Publication 551, Basis of Assets.
A14. Yes. If you pay for a service using virtual currency that you hold as a capital asset, then you have exchanged a capital asset for that service and will have a capital gain or loss. For more information on capital gains and capital losses, see Publication 544, Sales and Other Dispositions of Assets.
A15. Your gain or loss is the difference between the fair market value of the services you received and your adjusted basis in the virtual currency exchanged. For more information on gain or loss from sales or exchanges, see Publication 544, Sales and Other Dispositions of Assets.
A16. Yes. If you exchange virtual currency held as a capital asset for other property, including for goods or for another virtual currency, you will recognize a capital gain or loss. For more information on capital gains and capital losses, see Publication 544, Sales and Other Dispositions of Assets.
A17. Your gain or loss is the difference between the fair market value of the property you received and your adjusted basis in the virtual currency exchanged. For more information on gain or loss from sales or exchanges, see Publication 544, Sales and Other Dispositions of Assets.
A18. If, as part of an arm’s length transaction, you transferred virtual currency to someone and received other property in exchange, your basis in that property is its fair market value at the time of the exchange. For more information on basis, see Publication 551, Basis of Assets.
A19. Yes. If you transfer property held as a capital asset in exchange for virtual currency, you will recognize a capital gain or loss. If you transfer property that is not a capital asset in exchange for virtual currency, you will recognize an ordinary gain or loss. For more information on gains and losses, see Publication 544, Sales and Other Dispositions of Assets.
A20. Your gain or loss is the difference between the fair market value of the virtual currency when received (in general, when the transaction is recorded on the distributed ledger) and your adjusted basis in the property exchanged. For more information on gain or loss from sales or exchanges, see Publication 544, Sales and Other Dispositions of Assets.
A21. If, as part of an arm’s length transaction, you transferred property to someone and received virtual currency in exchange, your basis in that virtual currency is the fair market value of the virtual currency, in U.S. dollars, when the virtual currency is received. For more information on basis, see Publication 551, Basis of Assets.
A22. A hard fork occurs when a cryptocurrency undergoes a protocol change resulting in a permanent diversion from the legacy distributed ledger. This may result in the creation of a new cryptocurrency on a new distributed ledger in addition to the legacy cryptocurrency on the legacy distributed ledger. If your cryptocurrency went through a hard fork, but you did not receive any new cryptocurrency, whether through an airdrop (a distribution of cryptocurrency to multiple taxpayers’ distributed ledger addresses) or some other kind of transfer, you don’t have taxable income.
A23. If a hard fork is followed by an airdrop and you receive new cryptocurrency, you will have taxable income in the taxable year you receive that cryptocurrency.
A24. When you receive cryptocurrency from an airdrop following a hard fork, you will have ordinary income equal to the fair market value of the new cryptocurrency when it is received, which is when the transaction is recorded on the distributed ledger, provided you have dominion and control over the cryptocurrency so that you can transfer, sell, exchange, or otherwise dispose of the cryptocurrency.
A25. If you receive cryptocurrency from an airdrop following a hard fork, your basis in that cryptocurrency is equal to the amount you included in income on your Federal income tax return. The amount included in income is the fair market value of the cryptocurrency when you received it. You have received the cryptocurrency when you can transfer, sell, exchange, or otherwise dispose of it, which is generally the date and time the airdrop is recorded on the distributed ledger. See Rev. Rul. 2019-24. For more information on basis, see Publication 551, Basis of Assets.
A26. If you receive cryptocurrency in a transaction facilitated by a cryptocurrency exchange, the value of the cryptocurrency is the amount that is recorded by the cryptocurrency exchange for that transaction in U.S. dollars. If the transaction is facilitated by a centralized or decentralized cryptocurrency exchange but is not recorded on a distributed ledger or is otherwise an off-chain transaction, then the fair market value is the amount the cryptocurrency was trading for on the exchange at the date and time the transaction would have been recorded on the ledger if it had been an on-chain transaction.
A27. If you receive cryptocurrency in a peer-to-peer transaction or some other transaction not facilitated by a cryptocurrency exchange, the fair market value of the cryptocurrency is determined as of the date and time the transaction is recorded on the distributed ledger, or would have been recorded on the ledger if it had been an on-chain transaction. The IRS will accept as evidence of fair market value the value as determined by a cryptocurrency or blockchain explorer that analyzes worldwide indices of a cryptocurrency and calculates the value of the cryptocurrency at an exact date and time. If you do not use an explorer value, you must establish that the value you used is an accurate representation of the cryptocurrency’s fair market value.
A28. When you receive cryptocurrency in exchange for property or services, and that cryptocurrency is not traded on any cryptocurrency exchange and does not have a published value, then the fair market value of the cryptocurrency received is equal to the fair market value of the property or services exchanged for the cryptocurrency when the transaction occurs.
A29. Your holding period begins the day after it is received. For more information on holding periods, see Publication 544, Sales and Other Dispositions of Assets.
A30. No. A soft fork occurs when a distributed ledger undergoes a protocol change that does not result in a diversion of the ledger and thus does not result in the creation of a new cryptocurrency. Because soft forks do not result in you receiving new cryptocurrency, you will be in the same position you were in prior to the soft fork, meaning that the soft fork will not result in any income to you.
A31. No. If you receive virtual currency as a bona fide gift, you will not recognize income until you sell, exchange, or otherwise dispose of that virtual currency. For more information about gifts, see Publication 559, Survivors, Executors, and Administrators.
A32. Your basis in virtual currency received as a bona fide gift differs depending on whether you will have a gain or a loss when you sell or dispose of it. For purposes of determining whether you have a gain, your basis is equal to the donor’s basis, plus any gift tax the donor paid on the gift. For purposes of determining whether you have a loss, your basis is equal to the lesser of the donor’s basis or the fair market value of the virtual currency at the time you received the gift. If you do not have any documentation to substantiate the donor’s basis, then your basis is zero. For more information on basis of property received as a gift, see Publication 551, Basis of Assets.
A33. Your holding period in virtual currency received as a gift includes the time that the virtual currency was held by the person from whom you received the gift. However, if you do not have documentation substantiating that person’s holding period, then your holding period begins the day after you receive the gift. For more information on holding periods, see Publication 544, Sales and Other Dispositions of Assets.
A34. If you donate virtual currency to a charitable organization described in Internal Revenue Code Section 170(c), you will not recognize income, gain, or loss from the donation. For more information on charitable contributions, see Publication 526, Charitable Contributions.
A35. Your charitable contribution deduction is generally equal to the fair market value of the virtual currency at the time of the donation if you have held the virtual currency for more than one year. If you have held the virtual currency for one year or less at the time of the donation, your deduction is the lesser of your basis in the virtual currency or the virtual currency’s fair market value at the time of the contribution. For more information on charitable contribution deductions, see Publication 526, Charitable Contributions.
A36. A charitable organization can assist a donor by providing the contemporaneous written acknowledgment that the donor must obtain if claiming a deduction of $250 or more for the virtual currency donation. See Publication 1771, Charitable Contributions Substantiation and Disclosure RequirementsPDF, for more information.
A charitable organization is generally required to sign the donor’s Form 8283, Noncash Charitable Contributions, acknowledging receipt of charitable deduction property if the donor is claiming a deduction of more than $5,000 and if the donor presents the Form 8283 to the organization for signature to substantiate the tax deduction. The signature of the donee on Form 8283 does not represent concurrence in the appraised value of the contributed property. The signature represents acknowledgement of receipt of the property described in Form 8283 on the date specified and that the donee understands the information reporting requirements imposed by section 6050L on dispositions of the donated property (see discussion of Form 8282 in FAQ 37). See Form 8283 instructions for more information.
A37. Charitable organization that receives virtual currency should treat the donation as a noncash contribution. See Publication 526, Charitable Contributions, for more information. Tax-exempt charity responsibilities include the following:
- Charities report non-cash contributions on a Form 990-series annual return and its associated Schedule M, if applicable. Refer to the Form 990 and Schedule M instructions for more information.
- Charities must file Form 8282, Donee Information Return, if they sell, exchange or otherwise dispose of charitable deduction property (or any portion thereof) – such as the sale of virtual currency for real currency as described in FAQ 4 – within three years after the date they originally received the property and give the original donor a copy of the form. See the instructions on Form 8282 for more information.
A charitable organization is generally required to sign the donor’s Form 8283, Noncash Charitable Contributions, acknowledging receipt of charitable deduction property if the donor is claiming a deduction of more than $5,000 and if the donor presents the Form 8283 to the organization for signature to substantiate the tax deduction. The signature of the donee on Form 8283 does not represent concurrence in the appraised value of the contributed property. The signature represents acknowledgement of receipt of the property described in Form 8283 on the date specified and that the donee understands the information reporting requirements imposed by section 6050L on dispositions of the donated property (see discussion of Form 8282 in FAQ 37). See Form 8283 instructions for more information.
A38. No. If you transfer virtual currency from a wallet, address, or account belonging to you, to another wallet, address, or account that also belongs to you, then the transfer is a non-taxable event, even if you receive an information return from an exchange or platform as a result of the transfer.
- Charities report non-cash contributions on a Form 990-series annual return and its associated Schedule M, if applicable. Refer to the Form 990 and Schedule M instructions for more information.
- Charities must file Form 8282, Donee Information Return, if they sell, exchange or otherwise dispose of charitable deduction property (or any portion thereof) – such as the sale of virtual currency for real currency as described in FAQ 4 – within three years after the date they originally received the property and give the original donor a copy of the form. See the instructions on Form 8282 for more information.
A charitable organization is generally required to sign the donor’s Form 8283, Noncash Charitable Contributions, acknowledging receipt of charitable deduction property if the donor is claiming a deduction of more than $5,000 and if the donor presents the Form 8283 to the organization for signature to substantiate the tax deduction. The signature of the donee on Form 8283 does not represent concurrence in the appraised value of the contributed property. The signature represents acknowledgement of receipt of the property described in Form 8283 on the date specified and that the donee understands the information reporting requirements imposed by section 6050L on dispositions of the donated property (see discussion of Form 8282 in FAQ 37). See Form 8283 instructions for more information.
A39. Yes. You may choose which units of virtual currency are deemed to be sold, exchanged, or otherwise disposed of if you can specifically identify which unit or units of virtual currency are involved in the transaction and substantiate your basis in those units.
- Charities report non-cash contributions on a Form 990-series annual return and its associated Schedule M, if applicable. Refer to the Form 990 and Schedule M instructions for more information.
- Charities must file Form 8282, Donee Information Return, if they sell, exchange or otherwise dispose of charitable deduction property (or any portion thereof) – such as the sale of virtual currency for real currency as described in FAQ 4 – within three years after the date they originally received the property and give the original donor a copy of the form. See the instructions on Form 8282 for more information.
A charitable organization is generally required to sign the donor’s Form 8283, Noncash Charitable Contributions, acknowledging receipt of charitable deduction property if the donor is claiming a deduction of more than $5,000 and if the donor presents the Form 8283 to the organization for signature to substantiate the tax deduction. The signature of the donee on Form 8283 does not represent concurrence in the appraised value of the contributed property. The signature represents acknowledgement of receipt of the property described in Form 8283 on the date specified and that the donee understands the information reporting requirements imposed by section 6050L on dispositions of the donated property (see discussion of Form 8282 in FAQ 37). See Form 8283 instructions for more information.
A40. You may identify a specific unit of virtual currency either by documenting the specific unit’s unique digital identifier such as a private key, public key, and address, or by records showing the transaction information for all units of a specific virtual currency, such as Bitcoin, held in a single account, wallet, or address. This information must show (1) the date and time each unit was acquired, (2) your basis and the fair market value of each unit at the time it was acquired, (3) the date and time each unit was sold, exchanged, or otherwise disposed of, and (4) the fair market value of each unit when sold, exchanged, or disposed of, and the amount of money or the value of property received for each unit.
A41. If you do not identify specific units of virtual currency, the units are deemed to have been sold, exchanged, or otherwise disposed of in chronological order beginning with the earliest unit of the virtual currency you purchased or acquired; that is, on a first in, first out (FIFO) basis.
A42. You must report income, gain, or loss from all taxable transactions involving virtual currency on your Federal income tax return for the taxable year of the transaction, regardless of the amount or whether you receive a payee statement or information return.
A43. You must report most sales and other capital transactions and calculate capital gain or loss in accordance with IRS forms and instructions, including on Form 8949, Sales and Other Dispositions of Capital Assets, and then summarize capital gains and deductible capital losses on Form 1040, Schedule D, Capital Gains and Losses.
A44. You must report ordinary income from virtual currency on Form 1040, U.S. Individual Tax Return, Form 1040-SS, Form 1040-NR, or Form 1040, Schedule 1, Additional Income and Adjustments to IncomePDF, as applicable.
A45. Information on virtual currency is available at IRS.gov/digitalassets. Many questions about the tax treatment of virtual currency can be answered by referring to Notice 2014-21 and Rev. Rul. 2019-24.
A46. The Internal Revenue Code and regulations require taxpayers to maintain records that are sufficient to establish the positions taken on tax returns. You should therefore maintain, for example, records documenting receipts, sales, exchanges, or other dispositions of virtual currency and the fair market value of the virtual currency.
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