If you make an investment and you haven't made a capital gain (I am thinking specifically in investments not formally classified as such - like cryptocurrency, or any investment which doesn't come with its own declaration, such as owning a house or a stock), but rather loss or break even, are you supposed to make a tax declaration on such investment?

The question is not about a specific country, but rather Europe and the US. I do not expect local tax information but a general indication on how governments work with capital gain tax and declaration.

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    There’s no such thing as a “general indication”. Different countries have different rules. You have to pick one specific country (and perhaps even a sub-jurisdiction within the country) if you want an answer. – Mike Scott Jan 6 at 21:22
  • You're right but I've learned sooner or later all countries (at least "western world") do align on most legal and tax stuff. Hence what I mean by general indication. If taking the US is a good example of such (no idea if the US ever takes inspiration from other countries, I am European) then that serves as general indication – dragonmnl Jan 6 at 21:59

In the U.S. a stock, bond, option, or most other assets can only be a capital gain if it is closed-out. But some derivatives like futures contracts or forex contracts are marked-to-market at year-end for a gain or loss whether they are closed-out or not.

A stock or option brokerage account reports all closed positions and so all the closed positions must be accounted on a capital gain/loss form. But a capital gain of any kind is legally required to be reported.

  • As far as cryptocurrencies, as they were specifically mentioned, while these are not directly reported to the IRS the way a broker would; the IRS is well aware of the exchanges that transact cryptocurrencies, and can collect the information they need from the ledger and from exchanges to determine if you are making profit and neglecting to report it. Gains and losses by trading a cryptocurrency should also be submitted as a capital gains/loss for the year that the position was closed - similar to stocks - even when transacting from one coin directly in to another. – Shorlan Jan 8 at 22:41

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