By Jeff John Roberts
Bitcoin owners received a surprise this August when a parallel version of the currency, known as Bitcoin Cash, was distributed to every existing bitcoin owner on a one-to-one basis.
The new currency soon traded for hundreds of dollars, and during a bout of speculative mania this weekend, one unit of Bitcoin Cash was briefly worth as much as $2,500—not as much as the original, but still a tidy chunk of digital change.
Bitcoin Cash arrived quite literally as free money. The windfall, however, poses potential tax headaches for every bitcoin owner at a time when the IRS is getting more aggressive about digital currency.
How do you tax an “air drop”?