Tax Consequences of Foreign Currency Fluctuations

Authors

Sheldon S. Cohen

First Page

13

Abstract

This article concerns the United States federal income tax treatment of the gains and losses resulting from transactions involving currencies other than the United States dollar. United States income taxes must be computed and paid in United States dollars. Therefore, when persons subject to United States income taxes engage in transactions involving foreign currencies, they must account for their profits in terms of dollars for United States income tax purposes. This result follows even if the taxpayer does not actually convert the results of these transactions into dollars. Whether the failure to convert is voluntary, or results from legal restrictions imposed by foreign law, the result is the same

Recommended Citation

Sheldon S. Cohen, Tax Consequences of Foreign Currency Fluctuations, 6 Vanderbilt Law Review 13 (1972)
Available at: https://scholarship.law.vanderbilt.edu/vjtl/vol6/iss1/4