Is it necessary to declare bitcoin with the IRS? Find out what the tax authorities say

The submission of the Income Tax declaration in 2025, relating to income from 2024, must be carried out from April 1st to June 30th, 2025. Despite being an annual process, there are always doubts in some situations. And what to do with cryptoactives, such as bitcoin?

Gains obtained from the sale of cryptoactives will have an impact on the Income Tax declaration
Cryptoassets, also called “virtual assets”, such as bitcoin, are digital representations of values ​​or rights that can be transferred and stored electronically. They are based on blockchaina type of decentralized information recording technology, which does not have a central administrator.
Portuguese legislation provides for the taxation of cryptocurrencies in specific situations. The gains obtained from the sale of cryptoactives will have an impact on the declaration that the Portuguese will have to fill out. It is worth noting that the declaration must be submitted between April 1st and June 30th, referring to earnings from 2024 - you can see all the dates here.
According to Tax Authorityall income with regard to cryptoassets must be entered in IRS Category G, “Gains and asset increments”, if you are declaring individually. You can also classify income from cryptocurrencies as a professional activity, and they must be included in IRS Annex B: “Income of Category B Simplified Regime/Isolated Act”.
Category G – Capital gains

If you sell Bitcoin (or other cryptocurrencies) for a profit, capital gains are taxed at a rate of 28%.
Earnings from cryptocurrencies held by more than 1 year they are exempt from taxationas long as you are a tax resident in Portugal.

B. Category B – Commercial or Professional Activity

If you use Bitcoin as part of an economic activity (e.g. frequent trading or mining), the income is considered an independent activity and taxed at the Category B.
You can opt for the simplified regime (with taxation based on a percentage of income) or organized accounting.

C. Category E – Capital Income

Passive income such as fees or rewards from staking, are taxed as capital income at the rate of 28%.

If you have questions or a more complex situation, such as income from multiple sources or intensive trading, it is advisable to consult an accountant or tax specialist.