@nbizic56 thank you for another question. For background, the IRS doesn't allow you to deduct hobby expenses from hobby income. You must claim all hobby income and are not permitted to reduce that income by any expenses.
Again @nbizic56, when you earn cryptocurrency from mining, it counts as regular taxable income. You owe tax on the entire value of the crypto on the day you receive it, at your marginal income tax rate.
Since you included the $10 as income in the year you received the $10 in crypto, when you sell if after a year, any amount over the $10 is a gain and any amount less than the $10 is a loss.
Be well and safe.
All the best,
Marc T.
TurboTax Live Select Time Tax Expert
26 Plus Years of Experience Helping Clients
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