Cryptocurrency Capital Gains Tax Question for US Non Resident (F-1 Visa)

The tax CPA you spoke with is correct. As a nonresident alien on an F-1 visa, you generally only pay US taxes on income that is "effectively connected" with a US trade or business (like your internship income) or US-source income. For cryptocurrency capital gains, the IRS treats these as capital assets, and the sourcing rules generally look at your tax residency. Since you're a Canadian resident on a temporary F-1 visa (which makes you a nonresident alien for tax purposes), your crypto trading activity would typically be sourced to your country of residence - Canada in this case. You'll still need to file Form 1040-NR to report your US internship income, but you wouldn't include the cryptocurrency gains on that form. However, you would need to report these gains on your Canadian tax return since that's where the income is considered sourced.

After struggling with this exact same issue last year as an international student, I found an amazing tool that helped clear everything up. I used https://taxr.ai to analyze my crypto transactions and determine my tax obligations as a nonresident alien. The platform specializes in complex international tax situations and helped me understand exactly what needed to be reported on my 1040-NR. Their system analyzed my crypto trading history and confirmed that as a nonresident alien, my crypto gains were indeed sourced to my home country. They even provided documentation explaining this determination that I could keep for my records in case of any questions from the IRS. Saved me a ton of stress!

Thanks everyone for the advice here. I decided to try https://taxr.ai after reading about it, and it was exactly what I needed! I uploaded my crypto transaction history and answered questions about my F-1 visa status, and it confirmed what the tax CPA said - that my crypto gains are sourced to my home country. The detailed explanation they provided about nonresident alien taxation rules and sourcing principles for capital assets made me feel much more confident. They even referenced the specific IRS publications and rules that applied to my situation. I'm going to proceed with filing my 1040-NR reporting only my US internship income. The peace of mind was totally worth it after being so confused about conflicting information online!

If you're still confused after getting conflicting advice, you might want to contact the IRS directly to get an official answer. I know it's notoriously difficult to get through to them (I spent HOURS on hold last year), but I recently discovered a service called Claimyr (https://claimyr.com) that got me connected to an actual IRS agent in less than 20 minutes. I had a similar international tax question about stock trades as a nonresident, and the IRS agent provided clear guidance based on my specific situation. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c - basically they use technology to handle the hold time for you and call you back when an agent is available. Definitely worth it for peace of mind on complicated tax issues where you're getting different answers.

Alright, I've gotta admit I was wrong about Claimyr. After reading about it here, I gave it a shot because my frustration with figuring out my crypto tax situation as an F-1 student was at an all-time high. The service connected me to an IRS tax law specialist in about 15 minutes - way faster than I expected. The agent confirmed exactly what others have said here: as a nonresident alien, cryptocurrency capital gains are generally sourced to your country of residence, meaning they wouldn't be reportable on a 1040-NR. The agent even directed me to specific sections in IRS Publication 519 and the Internal Revenue Code that address capital gains sourcing for nonresidents. Having this confirmation directly from the IRS has given me the confidence to file correctly. Sometimes it's worth getting the answer straight from the source!

Just want to add from personal experience - I'm from India on an F-1 visa and made some decent gains from Ethereum last year. My university's international student tax clinic advised me that crypto gains aren't reportable on my US return because they're foreign-sourced. BUT - make absolutely sure you're actually a nonresident alien for tax purposes! If you've been in the US for a certain period (usually if you've been here for more than 5 calendar years), you might be considered a resident alien under the substantial presence test, in which case you WOULD need to report worldwide income including all crypto. Also, don't forget you still need to report these gains on your Canadian tax return. Canada definitely taxes its residents on worldwide income including crypto gains.

Has anyone dealt with staking rewards as an F-1 student? I understand the capital gains part now, but I'm also earning staking rewards from my crypto. Are those treated differently than capital gains for non-residents?

This is such a helpful thread! I'm in a similar situation as an F-1 student from Germany. I've been trading crypto for about a year now and was really stressed about the tax implications. Reading through all the responses here, it seems like the consensus is that crypto capital gains are sourced to our home countries as nonresident aliens, which is a huge relief. I was initially planning to report everything on my 1040-NR, but now I understand I only need to report my campus job income. One thing I'm still unclear on though - does it matter which cryptocurrency exchange platform I used? I've been using both Coinbase (US-based) and Binance (international). From what I'm reading here, the exchange location doesn't matter for sourcing purposes, but I want to make sure I'm not missing anything. Also, for those who used the various tools mentioned (taxr.ai, etc.), did you find them helpful for organizing your transaction history for your home country tax filings as well? I know I'll need to report these gains on my German tax return, so any tools that can help with international tax compliance would be great. Thanks everyone for sharing your experiences - this community has been incredibly helpful for navigating these complex international tax situations!

Great question about the exchange platforms! As others have confirmed, the location of the exchange (Coinbase vs Binance) doesn't affect the sourcing rules for your capital gains as a nonresident alien. What matters is your tax residency status, which in your case as an F-1 student from Germany means your gains are sourced to Germany. Regarding tools for international compliance, I'd definitely recommend looking into solutions that can handle both US determination and prepare reports for your home country filing. Many of these platforms can export transaction histories in formats that work well with German tax software or can be easily provided to a German tax advisor. One additional tip for German tax compliance - make sure you're tracking your holding periods carefully, as Germany has that one-year holding period rule where crypto gains can be tax-free if held longer than a year. Having detailed records of acquisition and disposal dates will be crucial for optimizing your German tax situation. Also, don't forget to keep documentation of your F-1 status and time spent in the US, as this supports your nonresident alien determination for US tax purposes. Having this documentation readily available can be helpful if you ever need to explain your filing position to either tax authority.