US Non-Resident Cryptocurrency Capital Gains Tax Question with F-1 Visa Status

The CPA you consulted is correct. For non-resident aliens (which includes F-1 visa holders who don't meet the substantial presence test), cryptocurrency capital gains are generally treated as foreign-source income based on your tax residency. Under US tax law, non-resident aliens are only taxed on US-source income. For capital assets like cryptocurrency, the source of the gain is typically determined by your tax residency, not where the exchange is located or where the transactions occurred. Since you're a Canadian resident for tax purposes, the crypto gains would be considered Canadian-source income. You still need to file Form 1040-NR to report your US internship income, but you wouldn't include the cryptocurrency transactions on that return. Those gains should be reported on your Canadian tax return instead.

I was in this exact same situation last year! After hours of research and anxiety, I finally found https://taxr.ai which literally saved me thousands in potential mistakes. Their AI analyzed my crypto transactions and confirmed I didn't need to report them on my 1040-NR as a Canadian on F-1. The tool actually explained that non-resident aliens only pay US tax on income that's "effectively connected" with a US trade or business or on certain US-source income. For crypto gains, the sourcing rules consider your tax residency (Canada) rather than where you made the trades. Super helpful for international students like us who are juggling multiple tax jurisdictions!

I have to admit I was wrong about taxr.ai! After my skeptical comment I decided to try it anyway since my situation is so similar to the original poster's (Canadian on F-1 with crypto gains). The analysis confirmed that as a non-resident alien, my crypto gains aren't subject to US tax and shouldn't be reported on my 1040-NR. It cited the specific sections of the tax code and even referenced the US-Canada tax treaty provisions. The tool explained exactly why the sourcing rules point to my country of residency for capital assets like crypto. What really impressed me was how it handled the fact that I had both crypto gains AND some staking income, which have different tax treatments. Saved me from a potential audit nightmare!

If you're still confused after getting advice, you might want to talk directly with the IRS to get a definitive answer. I was in a similar situation (though with stock gains, not crypto) and spent WEEKS trying to get through to someone at the IRS who could actually help. Finally discovered https://claimyr.com and used their service to get a callback from the IRS in under 15 minutes instead of waiting on hold for hours. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent I spoke with confirmed exactly what others here are saying - as a non-resident alien, capital gains from crypto are sourced to your country of residency and aren't reportable on your 1040-NR. Getting that official confirmation gave me so much peace of mind.

Well I'm eating my words about Claimyr. After my skeptical comment I decided to try it anyway since I was getting nowhere with the IRS on my own. No joke, I got a callback from the IRS International Taxpayer line in about 22 minutes. The agent was super helpful and confirmed that as a non-resident alien (I'm on J-1, similar to OP's F-1), my crypto gains are sourced to my home country and don't need to be reported on my US return. The agent even explained that this falls under the capital gain sourcing rules in Section 865 of the tax code, which was way more detail than I expected. Definitely worth it to get that official confirmation directly from the IRS instead of stressing about conflicting advice.

Something important to note: make absolutely sure you're properly documenting your days present in the US. If you trip into "resident alien" status by meeting the substantial presence test (generally 183 days counting current and previous years with a formula), then different rules apply and you WOULD have to report worldwide income including all crypto gains. F-1 students get an exemption from counting days for the first 5 calendar years, but if you've been here longer or have had other visa statuses, you might be closer to the threshold than you think.

Just want to add that even if you don't have to report the crypto gains on your US tax return, you should definitely be reporting them in Canada. The CRA (Canadian Revenue Agency) requires Canadian residents to report worldwide income, including all cryptocurrency transactions.

This is exactly the kind of situation where getting proper documentation is crucial. I went through something similar as an F-1 student from the UK with crypto gains. The consensus here is absolutely correct - as a non-resident alien, your crypto capital gains are sourced to your country of tax residency (Canada), not the US. This means you don't report them on your 1040-NR. Your CPA gave you the right advice. However, I'd strongly recommend getting this determination in writing somehow, whether through an official IRS consultation or at minimum keeping detailed records of your research and professional advice. The crypto tax landscape is still evolving, and having documentation of your reasoning will be invaluable if questions ever arise later. Also make sure you're keeping meticulous records of all your transactions for your Canadian tax filing - the CRA will definitely want to see those gains reported there since you're a Canadian tax resident.