I was a victim of a Bitcoin scam on cash app back in 2023. The scammer made me buy, and send them the money. I didn’t receive a tax form last year. Do I file a form?

[Vanessa A]

No.  If you simply purchased the bitcoins and then gifted them, you would not have any type of tax forms to receive or file.  "Gifting" even when it is a scam, does not create a taxable event.  There is nothing for you to file.  This is not a transaction that is taxable nor is it deductible. 

 If you sold the bitcoins or disposed of them in exchange for gifts or services or online products or anyth..., then it would be a taxable event and you would need to report them using your records if you did not receive a form.  Since this happened in 2023, if it was NOT a "gift to the scammer" then you would need to either Amend Your Return for 2023 or file a 2023 return if you did not to include the disposal/sale of the bitcoins.

If you were scammed

[sierrajcurry]

Ok thank you. I received a “my performance all time returns” from cash app for the gains or losses. Should I file a form or report it to the irs about everything that happened in the scam. On the bitcoin blockchain it shows I have nothing in the blockchain chain 0$ even though I bought and send it to the scammer. 

[sierrajcurry]

I also had an all time returns my performance on cashapp for Bitcoin and shows the gain and losses from when I bought the bitcoin in the scam. Do I report this? 

[Vanessa A]

So basically, if you disposed of any of the bitcoin in any way other than gifting and you made a profit, EVEN IF IT WENT TO THE SCAMMERS, this is taxable income.  

If you DID have gains on your bitcoins, then you WOULD report this. If you did anything other than purchase your Bitcoins and then gift them, you will need to report it on your return. So if you bought dinner with your Bitcoin, this would be considered selling it and would be a reportable transaction.  So if you have gains and losses on Cash App, then it sounds like you likely have some type of reportable transactions.  The second you cash out or use the currency to pay for something, it becomes a reportable event to the IRS. 

When deciding whether or not this is reportable, you do not consider the scam part.  You ONLY consider the disposal and gains/losses (NOT related to the scam) The scam does not in any way shape or form change how you would report your Bitcoin transactions.