Enter rewards in TurboTax as other income.
Follow these steps to enter in TurboTax Online:
- Down the left side of the screen, click Tax Home.
- Down the down arrow to the right of Wages & Income. Click Review / Edit.
- Click the down arrow to the right of Less Common Income.
- To the right of Miscellaneous Income, 1099-A, 1099-C, click the Start / Revisit button.
- To the right of Other reportable income, click the Start / Revisit button.
- At the screen Other Taxable Income, enter a description such as “Cryptocurrency rewards” and an amount.
The entries will be reported:
- on line 8z of Schedule 1 of the Federal 1040 tax return, and
- on line 8 of the Federal 1040 tax return.
The IRS has ruled that rewards only become taxable once the taxpayer "acquires the ability to transfer, sell, exchange, or otherwise dispose of the cryptocurrency." You will need to convert your rewards to US dollars if they have not been issued in U.S. dollars.
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