So Money with Farnoosh Torabi

Episode 1920: Ask Farnoosh – Tax on Bitcoin? How to Negotiate Workplace Benefits?
Date: December 19, 2025

Episode Overview

In this insightful "Ask Farnoosh" Friday episode, award-winning financial strategist Farnoosh Torabi answers listener questions about taxes on gifted Bitcoin, strategies for negotiating employee benefits (including equity) at small businesses, making wise investments in personal health, and understanding the tax implications of whole life insurance policy withdrawals. Farnoosh weaves practical advice with empowering commentary, encouraging listeners to seek financial security through knowledge, community, and intentional wellness.

Key Discussion Points & Insights

1. Tax Implications for Gifted Bitcoin

[04:20]

• Listener Question: Lori received a Bitcoin gift from her mother worth $18,000 and is unsure about her future tax liability if she sells.
• Farnoosh’s Guidance:
  • Bitcoin Treated as Property: "Bitcoin and other cryptocurrencies [are] classified as property for federal tax purposes by the IRS and as such they are subject to capital gains rules." [05:40]
  • Cost Basis Inheritance: The recipient inherits the original cost basis of the Bitcoin from the gifter (her mother).
  • Determining Tax Owed:
    • If sold for more than the mom’s original price: The gain will be taxed as capital gain (short- or long-term depending on holding period).
    • If sold for less: Could realize a capital loss; IRS may adjust the cost basis to the fair market value for loss calculation.
  • Action Steps: Lori should find out her mom’s original purchase price and retain documentation. Consulting a tax professional is encouraged for clarity.
• Farnoosh’s Philosophy: "Cryptocurrency is very new financial terrain. It's highly volatile, it's highly risky. It's not something that I'm going to look at for building true wealth." [04:58]

2. How to Negotiate Workplace Benefits Beyond Salary

[09:34]

• Listener Question: Mary works at a small, family-owned business where she has received annual raises but wonders what additional benefits she could negotiate, especially regarding retirement and potential equity as the company grows.
• Farnoosh’s Advice:
  • Negotiate Retirement Plans:
    • Ask for an increase in the IRA matching percentage.
    • Collaborate with colleagues for a collective ask, which "is more compelling for your employer and even a little bit more pressure, good pressure, for them to listen to you when they know that you have the backing of your colleagues." [12:02]
  • Performance-Tied Bonuses: Suggest bonuses tied to measurable individual impact or company goals.
    • Example: Structuring bonuses similarly to increasing college admissions rates.
  • Additional Non-Monetary Benefits:
    • Professional development stipends, certifications, or conferences.
    • Additional paid time off.
    • Wellness benefits.
    • Flexible work arrangements.
    • "When you invest in yourself with the help of your employer, it's a long-term investment in your income, frankly, and your career positioning." [14:58]

[20:19]

• Negotiating Equity:
  • Family businesses may be hesitant to give actual ownership stakes.
  • Consider proposing profit-sharing or “phantom stock” instead.
    • "It ties your rewards to the company's financial success without requiring them to give up ownership stakes." [20:26]
  • Understand the company’s financial health and clarify terms around payout if the company sells.
  • Again, a collective proposal with colleagues may be more effective.

3. Navigating the Job Market with a Ph.D.

[22:31]

• Listener Concern: Early 40s Ph.D. graduate seeking tips for entering (or re-entering) a competitive job market.
• Farnoosh’s Encouragement:
  • Clarify Career Goals: Decide between academia, corporate, or nonprofit sectors; pick a targeted path to start.
  • Network: Tap into alumni, headhunters, and past classmates. “Your classmates are huge resources for you.” [24:04]
  • Leverage Your Skills: Emphasize transferable skills from your Ph.D. journey—research, leadership, critical thinking, project completion.
  • Positive Outlook: "You are an expert and you should get paid for that. And there should be some competition. You should have multiple bids. I would be very excited if I were you." [25:00]
  • Overcome Imposter Syndrome: Transferable skills are highly valuable—don’t downplay academic accomplishments.

4. Smart Investments in Health and Wellness

[27:04]

• Listener Inquiry: What are worthwhile health investments for longevity and well-being?
• Farnoosh’s Recommendations:
  • Preventative Care: Regular checkups and screenings, maintaining health insurance.
    • "Early detection—taking care of issues today—not only a lifesaver but saves you significant amount of money in the long run." [27:18]
  • Sleep Hygiene: Prioritize consistent, restorative sleep as a free form of investment in health.
    • "Sleep deprivation is a real thing. It's dangerous." [27:36]
  • Address Burnout: Self-care includes setting boundaries and managing stress.
    • Personal anecdote: Farnoosh recounts health issues caused by stress launching a business.
      • "It was manifesting physically in my body...I saw my body improve, I saw my health improve, I saw my relationships actually improve..." [29:02]
  • Holistic Approach: Nutrition, exercise, therapy—investments for both physical and mental health.
  • Healthcare Coverage: Even basic health insurance is critical to protect future well-being.

5. Taxation on Whole Life Insurance Cash Value Withdrawals

[31:13]

• Listener Question: Are cash withdrawals (not death benefits) from a whole life insurance policy taxable?
• Farnoosh’s Explanation:
  • Withdrawals Up To Premiums Paid: Tax-free up to the total amount of premiums paid into the policy.
  • Withdrawals Exceeding Premiums: Amounts above what’s been paid in may be subject to income tax.
  • Caveats: Each policy differs; consult a tax professional or financial advisor before making withdrawals.
  • Editorial Note: Farnoosh personally favors term life insurance for most people due to cost and simplicity.

Notable Quotes & Memorable Moments

• On Bitcoin’s Role in Wealth-Building:

  • “For the most part, people build wealth in this country because they stick to a plan, investing in tried and true investments, creating a diversified portfolio and investing a little bit at a time and not taking huge risks, not putting too many eggs in one basket.” [05:10]

• On Collective Negotiation:

  • “It is more compelling for your employer and even a little bit more pressure, good pressure, for them to listen to you when they know that you have the backing of your colleagues.” [12:12]

• On Health and Burnout:

  • “When that project went away, I started sleeping better...my body improved, my health improved, I saw my relationships actually improve with my partner and my kids.” [29:04]
  • “Investing in your health, it starts with things that don’t cost any money. Creating boundaries... I was just working 24/7, stressed all the time. I wasn’t talking about it with anybody, so probably could have used a therapist.” [29:50]

• On Job Market Confidence for Ph.D.s:

  • "You are an expert and you should get paid for that. And there should be some competition." [25:00]

Important Segment Timestamps

• [04:20] – Tax rules on gifted Bitcoin & capital gains
• [09:34] – Workplace benefit negotiations and creative proposals
• [20:19] – Equity vs. profit sharing vs. phantom stock at small businesses
• [22:31] – Ph.D. job market navigation and leveraging transferable skills
• [27:04] – Health investments: sleep, preventative care, stress management
• [31:13] – Whole life insurance: tax on cash withdrawals

Overall Tone & Style

Farnoosh’s responses are informed, warm, and empowering. She offers actionable advice layered with stories and examples, consistently reminding listeners to value self-advocacy and holistic well-being.

For Further Engagement

Listeners are encouraged to subscribe for upcoming themed highlight episodes covering topics like retirement, women and money, and midlife wealth. For deeper community engagement, Farnoosh promotes her So Money Members Club.

This summary covers the core listener questions and guidance from So Money episode 1920, capturing both the practical wisdom and encouraging tone that define Farnoosh’s empathetic approach to financial questions.