Crypto lending - where to report?

Forum|Forum|4 years ago
March 7, 2022
1 reply
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I lended cryptocurrencies to a cousin. Is there any place that I need to report that? I am not collecting any interest on that, the agreement was he would just return the same amount of crypto after certain period of time.

Thanks in advance.

Not A Product Question

Best answer by taxlady28

No, there is nothing to report.

taxlady28Answer

Level 10

No, there is nothing to report.

Love2BikeAuthor

Level 3

Back to my question.. so the crypto lending doesn't go by the same rule as fiat lending? Meaning there is no imputed interest by the AFR ruling?

https://www.irs.gov/applicable-federal-rates

GeorgeM777

Level 11

Correct. Whether you chose to apply the Applicable Federal Rates, or some other rate of interest inputted or not, if you have received no income of any type in connection with lending the cryptocurrency to your cousin, there is nothing to report on your tax return. Moreover, it appears your cousin would not report anything either, at least with regard to the cryptocurrency that was lent with the intention that it would be returned at a later time. Based on your post, the cryptocurrency resembles a loan, and loans are not considered income because of the promise to repay in kind. However, if the arrangement with your cousin should change, then there could be tax ramifications. Additionally, should your cousin use or leverage the cryptocurrency to create income, then your cousin would need to report that income.

@Love2Bike

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