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RE: How to grow your crypto investment completely tax free (US residents)

in #tax7 years ago

I think it is important to clarify that if a US taxpayer is trading crypto through his or her Self-directed Roth IRA LLC there is a looming trap for the unwary called unrelated business taxable income "UBTI" that will subject the gains from trading to taxes each year whether or not any cash is pulled out (pending laws not changing on how cryptocurrency is treated). So this strategy is really only good for someone who is planning to put a sum of money into crypto as a Hodler expecting the underlying investment to grow by xthousand % and not doing anything until then. This SDROTHIRA strategy is limited in who it will benefit and has many drawbacks that need to be fleshed out before jumping in head first!

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