tl;dr u2022 you are taxed the same way as if you sold the bitcoin for fiat currency (e.g. USD)Disclosure: I am not a tax advisor and this is not tax advice. For tax advice, please speak with a tax professional.Bitcoin taxation rules vary from country-to-country, but in the US, the IRS states that cryptocurrency is taxed like property. That means that it doesnu2019t matter if you trade bitcoin for dollars or for goods/services directly. When you dispose of the bitcoin, you realized a capital gain/loss depending on the fair market value of the bitcoin at the time of the disposal. You will owe capital gains taxes on the gain/loss (the difference between the proceeds and the cost basis of the asset).You can use a tool like CoinTracker to automate these calculations for yourself (note: I work on CoinTracker).