Practice Test Geeks(CCA) Certified Cryptocurrency Auditor Practice Test
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Cryptocurrency Taxation & Accounting Flashcards

7 cards from real CCA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. How does the IRS classify cryptocurrency for federal tax purposes in the United States?

    Answer: As property

    The IRS classifies cryptocurrency as property under Notice 2014-21, meaning general tax principles applicable to property transactions apply.

  2. What type of income is recognized when cryptocurrency is received as payment for goods or services?

    Answer: Ordinary income

    Cryptocurrency received as payment for goods or services is treated as ordinary income equal to its fair market value at the time of receipt.

  3. Which cost basis accounting method allows taxpayers to minimize capital gains by designating specific lots of cryptocurrency to sell?

    Answer: Specific identification

    Specific identification allows taxpayers to designate exactly which units of cryptocurrency are being sold, giving maximum control over taxable gain calculations.

  4. Which of the following events does NOT trigger a taxable event for cryptocurrency?

    Answer: Transferring cryptocurrency between your own wallets

    Transferring cryptocurrency between wallets you own is not a taxable event because there is no change in ownership or realization of gain.

  5. What is the minimum holding period required for cryptocurrency gains to qualify as long-term capital gains in the US?

    Answer: More than 1 year

    Cryptocurrency held for more than one year qualifies for long-term capital gains tax rates, which are generally lower than ordinary income rates.

  6. How are cryptocurrency mining rewards taxed when first received by a US taxpayer?

    Answer: As ordinary income at fair market value

    Mining rewards are taxed as ordinary income at their fair market value when received and may also be subject to self-employment tax for miners operating as a business.

  7. Which IRS form is primarily used to report capital gains and losses from cryptocurrency disposals?

    Answer: Form 8949 and Schedule D

    Capital gains and losses from cryptocurrency disposals are reported on Form 8949 with details of each transaction, then summarized on Schedule D of Form 1040.