The reason a 1099-NEC form is popping up in TurboTax is because your cryptocurrency transaction(s) may be considered self-employed earned income.
For tax purposes, it’s either considered earned income or treated as property sales. We can help you figure out which applies to your situation.
It’s considered earned (self-employment) income when you:
- Receive it as payment for goods or services (like if you were paid in cash)
- Mine it and make a profit
- Receive new cryptocurrency from a hard fork followed by an airdrop or other transfer
It’s treated as a property sale, and the earnings are capital gains, when you:
- Sell it (like you would stock)
- Exchange it (swap one type of cryptocurrency for another)
- Spend it (use it as payment for goods and services)
- Convert it to US dollars (sell cryptocurrency to buy regular currency)
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