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10 Top Countries for Crypto Investors: ZERO Crypto TaxBitcoin is taxable if you sell it for a profit, use it to pay for for a service or earn it as income. You report your transactions in U.S. Bitcoin held as capital assets is taxed as property. When you hold Bitcoin it is treated as a capital asset, and you must treat them as property. One simple premise applies: All income is taxable, including income from cryptocurrency transactions. The U.S. Treasury Department and the IRS.