I have entered my crypto transactions, via a TXF file I created, in Turbo Tax Premier (Mac/downloaded). Using easytxf.com I created a txf file from a spreadsheet of my transactions, which imported into Turbo Tax fine.
My questions is related to this form: Wages & Taxes tab, under Investment income click Stocks, Mutual Funds, Bonds, Other. I click Update. All my crypto transactions were imported from one source, PayPal. So if I click "Edit" on the PayPal line within "Here's all the investment accounts we have so far", click Continue on "Confirm your financial institution info" page, I see "Here's all the sales reported by PayPal" (I have 15 of them). I verified that boxes 1a-1e are all correct for each transaction. My question is this - what should the Sale Category be? There are 7 choices; assume I am looking at a sale that is a short term gain/loss:
A - Short term covered
B - Short term non covered
C - Short term not reported
D - Long term covered
E - Long term non covered
F - Long term not reported
X - Unknown holding period
I know it's not D,E,F as it's short term; I know it's not X as I know the buy/sell dates. I think it's "covered" from what I read, as non-covered seem to be for old assets whose cost basis is not known? As for "not reported" - I think PayPal has not reported these transactions to the IRS, that it's not required until the 2023 tax year; which is why Turbo Tax asks the question "Did you have crypto transactions this year?", so they can look for them in the 8949 form, "Sales and Dispositions of Capital Assets". I also think these transactions were not reported to the IRS by PayPal because I received "Tax documents" from PayPal, which were just csv files of transactions and gains/losses. I did not receive anything marked as a 1099 of any kind. So there was no evidence of any form being sent to the IRS as far as I can tell.
So am I correct that short term PayPal/crypto transactions should be Box C, and long term PayPal/crypto transactions should be Box F? Thank you.
