Do I Report Crypo Currency Bought/Sold If Not with My Money?

[trakorfree]

For a donation project, I helped out with some of these bitcoin things. None were done with my own funds. I get cash from sources, buy them coin things, transfer to other users for the project. Done and done. This is not my income or anything. But, my bank account was used. Do I report this for any reason, or is that up to everyone else since I was the middle dude?

[AmyC]

Your bank account was used. That information went on a report already.  You state that you purchased the bitcoin and transferred it to others.  It sounds like you are actively purchasing and exchanging bitcoin and money. If so, select yes, you did receive, sell, send, exchange or otherwise acquire any financial interest in any virtual currency. 

If not, perhaps I am not understanding something in what you said.

[trakorfree]

Only my bank account and program was used. Not my money. Not my income. Not my gains or losses (except time).

Someone gives me the money in my bank. I then send it to a program like CashApp, convert it to bitcoins, and then transfer it to someone else.  I get nothing out of it but helping some colleagues.

So, does any of that matter?

[ThomasM125]

You will need to report as investment sales any proceeds reported to you on a form 1099-B and deduct as the cost basis an amount equal to the amount you pay back to the person that you purchased the investment for.

It sounds like you are in the business of transferring money. 

If you are not doing it for profit, then it would be considered a hobby and as such you cannot deduct expenses associated with it. So, you could be in some trouble if you were to get audited.

Since you are receiving the proceeds, it is conceivable that they would be taxable and you would be prevented from deducting the cost of the trades.

So, it would be best to charge a fee for your services and as such make it a legitimate business and then you can report the sales and deduct the cost basis and pay tax on the profit.

[trakorfree]

I would not consider it a hobby. Just helping out with transferring donations given to me and then I send to other people. Either by bitcoins, check, or a direct deposit into their bank. I only offered to help be the middle man while this project is happening (because of my organizational abilities) and then once the housing is done, so am I.

So, it sounds like then since it is not my money, and I do not make a cent off any of it, I will not be adding any bitcoin info as I gain nonthing financially from helping.

Seems like I do not need to do anything then in TT about it.

Thanks.