https://ttlc.intuit.com/community/taxes/discussion/401k-and-bitcoin/01/2066208#M743716 <P>I withdrew money from my 401k and received it as bitcoin through Square, Inc. I then converted the bitcoin to dollars and withdrew it. I entered the early withdrawal penalty in my return. I received a 1099b for the bitcoin conversion. Do I need to enter that separately if I already entered the 401k withdrawal?</P> Fri, 12 Mar 2021 03:01:00 GMT DocRaychE 2021-03-12T03:01:00Z https://ttlc.intuit.com/community/taxes/discussion/401k-and-bitcoin/01/2066208#M743716 <P>I withdrew money from my 401k and received it as bitcoin through Square, Inc. I then converted the bitcoin to dollars and withdrew it. I entered the early withdrawal penalty in my return. I received a 1099b for the bitcoin conversion. Do I need to enter that separately if I already entered the 401k withdrawal?</P> Fri, 12 Mar 2021 03:01:00 GMT https://ttlc.intuit.com/community/taxes/discussion/401k-and-bitcoin/01/2066208#M743716 DocRaychE 2021-03-12T03:01:00Z https://ttlc.intuit.com/community/taxes/discussion/re-401k-and-bitcoin/01/2077627#M747682 <P>Yes,&nbsp; you will have to post it as an additional transaction.</P> <P>&nbsp;</P> <P>You withdrew the money from your 401(k), and it sounds like you entered that correctly.&nbsp;</P> <P>&nbsp;</P> <P>You then essentially purchased (exchanged) the cash for cryptocurrency.</P> <P>When you exchanged it back into dollars it&nbsp;happened outside of the 401(k).</P> <P>&nbsp;</P> <P>This is a new taxable event and you will have to post the transaction.</P> <P>&nbsp;</P> <P>Traders report their business expenses on&nbsp;<A href="https://www.irs.gov/forms-pubs/about-schedule-c-form-1040" target="_blank">Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship)</A>.</P> Sun, 14 Mar 2021 15:08:13 GMT https://ttlc.intuit.com/community/taxes/discussion/re-401k-and-bitcoin/01/2077627#M747682 JohnB5677 2021-03-14T15:08:13Z