GlossaryBeginner
Taxable Event
An action, such as selling or trading an asset, that may need to be reported and could result in owing tax.
A taxable event is an action involving an asset — such as selling it, trading it for another asset, or receiving it as income — that a tax authority may require to be reported and that could result in owing tax. Rules for exactly what counts vary by jurisdiction.
In many jurisdictions, simply holding an asset without transacting is not itself a taxable event, though this and every other specific rule should be confirmed against current, jurisdiction-specific guidance rather than assumed.
Examples
- Trading one cryptocurrency for another can be a taxable event in many jurisdictions, even without ever converting to traditional currency.
- Receiving staking rewards can be treated as a taxable event depending on local rules.