Cryptocurrency and Other Digital Assets in Oregon Divorce Mediation: Matthew House, J.D.
Digital assets are, as the name suggests, assets that exist only in digital form. Matthew will ask you about all forms of digital assets that you may own. He will share how you may wish to address the disposition of those assets in your dissolution.
Cryptocurrency is probably the most widely-discussed digital asset at present. Although its regulatory status is in flux, cryptocurrency currently has has certain characteristics that resemble stocks in terms of how it is taxed and reported. The process of valuing, discounting, and dividing cryptocurrency assets in an Oregon divorce works similarly to that of a brokerage account.
The valuation of cryptocurrency depends on the tax consequences. The taxation of cryptocurrency is deferred until the time of sale. Once the cryptocurrency is sold, the gain is taxable either as ordinary income (if held for one year or less) or as long-term capital gains (if held for more than one year).
Cryptocurrency can be exchanged between spouses pursuant to a divorce without the exchange being considered a "sale" for purposes of triggering potential capital gains taxes. If either party in an Oregon divorce holds cryptocurrency or sold it in the 12 months preceding mediation, you will be asked to provide your current holdings and a 12-month transaction history.
Further, there are other digital assets besides cryptocurrency. Digital assets include assets such as Kindle books, downloaded music, gift card balances, Apple Store balances, Google Play balances, and frequent-flyer miles. Digital assets can be relatively easily addressed in divorce mediation with Matthew House. There is seldom taxation of digital assets (other than cryptocurrency) because the most commonly-held forms of digital assets do not increase in value. Some digital assets do appreciate, however.
Cryptocurrency is probably the most widely-discussed digital asset at present. Although its regulatory status is in flux, cryptocurrency currently has has certain characteristics that resemble stocks in terms of how it is taxed and reported. The process of valuing, discounting, and dividing cryptocurrency assets in an Oregon divorce works similarly to that of a brokerage account.
The valuation of cryptocurrency depends on the tax consequences. The taxation of cryptocurrency is deferred until the time of sale. Once the cryptocurrency is sold, the gain is taxable either as ordinary income (if held for one year or less) or as long-term capital gains (if held for more than one year).
Cryptocurrency can be exchanged between spouses pursuant to a divorce without the exchange being considered a "sale" for purposes of triggering potential capital gains taxes. If either party in an Oregon divorce holds cryptocurrency or sold it in the 12 months preceding mediation, you will be asked to provide your current holdings and a 12-month transaction history.
Further, there are other digital assets besides cryptocurrency. Digital assets include assets such as Kindle books, downloaded music, gift card balances, Apple Store balances, Google Play balances, and frequent-flyer miles. Digital assets can be relatively easily addressed in divorce mediation with Matthew House. There is seldom taxation of digital assets (other than cryptocurrency) because the most commonly-held forms of digital assets do not increase in value. Some digital assets do appreciate, however.