Do Crypto-to-crypto trades qualify as like-kind exchanges under Section 1031?

In order for crypto-to-crypto trades to qualify as like-kind exchanges under Section 1031, the cryptocurrency involved in the trade must be "like-kind property." Section 1031 does not define the term like kind property, but the regulations say that it refers to "the nature or character of the property and not to its grade or quality.”

Did SEC 1031 apply to bitcoin exchanges before TCJA?

On June 18, 2021, the IRS released IRS Legal Memorandum (ILM) 202124008, which addressed whether Sec. 1031 applied to certain exchanges of bitcoin, ether, and litecoin that occurred prior to the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115 - 97.

Are Like-Kind Exchanges tax free?

Unfortunately, this is not true. Even though like-kind exchanges are "tax free," every single trade must still be reported to the IRS. Like-kind exchanges are reported using Form 8824. Taxpayers with multiple like-kind exchanges can fill out just one Form 8824 and report the transaction details for each individual trade on an attached statement.