MicroStrategy Faces Potential Tax Burden on Unrealized Bitcoin Gains: Report

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MicroStrategy faces potential federal tax liabilities on its extensive Bitcoin holdings, estimated at $47 billion, according to a Wall Street Journal report on Friday.

The company’s massive crypto portfolio, which includes $18 billion in unrealized gains, has drawn attention amid evolving U.S. tax regulations.

Notably, this framework includes unrealized gains on assets like Bitcoin, meaning profits from assets that have appreciated in value but remain unsold could still be taxed.

The U.S. Corporate Alternative Minimum Tax (CAMT), introduced under the Inflation Reduction Act, imposes a 15% tax on adjusted GAAP earnings for corporations earning over $1 billion annually.

MicroStrategy Faces Possible Tax Bill from Bitcoin Holdings

To address these potential liabilities, the firm is reportedly negotiating with the Internal Revenue Service (IRS) to seek exemptions. MicroStrategy’s substantial Bitcoin accumulation has been a prominent aspect of its business strategy.

Should the tax be enforced, MicroStrategy may face billions of dollars in liabilities starting in 2026.

According to a Tuesday X post from Saylor, this latest acquisition brings the company’s total Bitcoin holdings to 461,000 BTC, valued at approximately $29.3 billion.

As MicroStrategy deals with potential tax liabilities, the firm continues to expand its Bitcoin portfolio. On January 21, the company added 11,000 BTC to its holdings, equivalent to $1.1 billion.

vMicroStrategy Expands Bitcoin Holdings with $1.1 Billion Purchase