Don’t lose those passwords if you’re passing cryptocurrency to your heirs – Press Enterp…

Cryptocurrency isn’t something you can put in your safe. It is something that must be maintained online and secured with passwords.

Related: Cryptocurrency 101: What is it? Can you trust it? How is it used

In the last year, the volatile pricing of cryptocurrencies, Bitcoin for one, has created some significant wealth for those that are trading it. Trading cryptocurrencies has also created a new group of people that will need to consider estate planning.

Even though everything about cryptocurrency is online, it’s not the same as online banking accounts. One difference is that it is personal property, not cash.

The IRS has pronounced that for tax purposes, taxpayers must treat Bitcoin (and all types of cryptocurrencies) as property rather than currency. Until the IRS changes that rationale, there will not be statements sent out to the owners.

ICYMI: Are cryptocurrency transactions taxable?

As such, beneficiaries may receive a step-up/or step-down in basis to equal the fair market…