Did you know you can donate cryptocurrencies like Bitcoin and Ethereum to support animal protection and potentially enjoy significant tax benefits? Read on to find out more.
Five years ago in mid-December, a post began to go viral on Reddit. In it, the Pineapple Fund announced it would be donating more than $50M in cryptocurrency to charities. Needless to say, this created a ripple effect in both the crypto community and the nonprofit world.
Since then, it has become more and more common for animal advocates to donate cryptocurrencies to support nonprofits like World Animal Protection. In fact, fully one-third of crypto investors donated crypto to charities as of two years ago, and for 2021 the total amount of crypto donated to charity skyrocketed by a colossal 1,558% over the previous year.
Digital assets are becoming an increasingly important source of funding for the work needed to protect animals.
Cryptocurrency Taxes
According to the IRS, taxes on crypto are similar to taxes on stocks and other investments: when you sell an asset, that is normally a taxable event if the asset has increased in value.
If you’ve held an asset–including cryptocurrency–for less than one year, any gains are taxed in alignment with your tax bracket. If you’ve held it for more than a year, the increase in value is subject to long-term capital gains tax.
The Tax Benefits of CryptoPhilanthropy
Many savvy donors make gifts of stock to avoid paying capital gains taxes–and the same is true for cryptocurrencies. In addition, supporters may donate NFTs to support the animals and benefit in similar ways.
For US residents, crypto donations are tax-deductible, and you may be able to reduce what you owe overall in capital gains taxes by planning to use crypto as part of your philanthropy. You can also receive a deduction for the fair market value of the crypto to the full extent allowable, just like for any other gift.
For more information, please see the Crypto Tax Survival Guide available for free.
Donate Crypto to Protect Animals
World Animal Protection accepts gifts of Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), and dozens of other cryptocurrencies. We encourage investors to consider the environmental impact of their portfolios by researching “green” cryptocurrencies which may use a proof-of-stake (PoS) protocol.
Visit our crypto giving page to make your donation quickly and easily today.
Note: This article is not tax, legal, or financial advice. Tax laws related to cryptocurrencies are still evolving and subject to change. Please consult qualified tax, legal, and financial advisors regarding your own philanthropy and individualized circumstances.