IRS Eyes $800 Million Crypto Windfall from Trump Family | Tax Treatment Explained
Edited By
Naomi Turner
Federal authorities are turning heads as the Trump family reportedly earned over $800 million from crypto asset sales in the first half of 2025. This brings into question how the IRS will handle potential taxation on these earnings.
Crypto Earnings Unveiled
Reuters reports that the bulk of this income derives from sales of World Liberty Financial Tokens and the infamous Trump memecoin. While the latest financial disclosure reflects about $57 million in crypto income from 2024, it is clear that 2025 will be a much bigger year for the Trumps.
How the IRS Will Tax It
According to the IRS guidelines, cryptocurrency is taxed like property. Therefore, any gains from the sale or swapping of coins are subject to capital gains tax, similar to stocks. Trump does not get special treatment here. Tax obligations depend on how the gains were derived:
Capital Gains: If tokens were sold, they fall under capital gains tax; short-term if held under one year, and long-term if held over.
Ordinary Income: If profits come from promoting or launching tokens, those gains may be taxed as business income.
Interestingly, unrealized gains remain untaxed until actual sales occur, meaning only the profits realized in 2025 will affect his tax returns. Moreover, as a Florida resident, Trump will avoid state income taxes, leaving federal obligations as the main concern.
Voices from the Crowd
Comments flooding different forums reflect skepticism toward Trump fulfilling his tax duties. Here are some key sentiments:
"You think he’s gonna start paying taxes now? lol"
"Considering Trump is the one destroying crypto, it’s a good question how he will be taxed."
"He’ll probably just skip paying taxes and nothing will happen."
Despite the skepticism, the sentiment is mixed. Some point out that rules apply generally, which could lead to typical tax liabilities for the Trump family.
Key Points from the Discussion
Tax Framework: The IRS treats cryptocurrency transactions as property sales, requiring gains to be reported.
Public Skepticism: Users express doubts about Trump's likelihood to pay; many believe he’ll exploit loopholes.
Focus on Federal Tax: As a Florida resident, Trump avoids state tax, but federal obligations loom.
The roaring amount of crypto revenue might present a significant challenge for Trump come tax season. While the headline figures impress, how this unfolds on paper may turn out to be more mundane and ordinary than perceived.
Possible Tax Implications on the Horizon
As tax season approaches, there's a substantial chance the IRS will scrutinize the Trump family's crypto gains closely. Experts estimate that around 70% of these earnings could be subject to capital gains tax, as many of the transactions likely fall under property sales. However, speculation about tax evasion tactics could stem from the skepticism noted in various forums, raising the likelihood that legal battles or lobbying efforts may surface. Considering the celebrities in the crypto space who've faced challenges with tax compliance, the Trump family might navigate a complex web between adhering to tax laws and leveraging loopholes, resulting in a higher-than-expected tax liability.
A Surprising Historical Echo
Reflecting on the infamous saga of the 19th-century railroad barons, many built immense wealth while also avoiding or skirting tax responsibilities. Much like today’s crypto boom, this led to public outcry and skepticism about their integrity and ethics. The routes the barons took to protect their fortunes provide an intriguing parallel to the crypto landscape today—every twist and turn in transactions is scrutinized. Just as the barons faced growing public scrutiny and potential regulations in response to their ways, Trump's crypto windfall may very well provoke similar reactions, suggesting that today’s fortunes could very quickly become tomorrow’s burden.