Question on a inheritance and crypto

mocha245 · ‎March 6, 2023

Father left his 10 year old car (altima) for me. I have been taking care of it since he passed away. Is this a taxable income? If, so which turbotax do I need to report?

I received small amount of crypto airdrop ($8.05 value) from Uphold exchange last year. No tax document received this year. Do I report this under Miscellaneous Income?

TomK2023 · ‎March 6, 2023

Your inherited car is not taxable (no need to enter it anywhere).

Cryptocurrency airdrops are (usually) free distributions of coins or tokens into multiple wallet addresses to promote and drive adoption of a new virtual currency.

According to the IRS, airdrops (along with promos and staking rewards) only become taxable once the taxpayer "acquires the ability to transfer, sell, exchange, or otherwise dispose of the cryptocurrency." Airdropped currency that's not yet usable or accessible isn't taxable until the taxpayer can exercise control over it.

If you can access your crypto airdrop, follow these steps to report it in TurboTax.

Step 1 - Convert to USD

Step 2 - Enter in TurboTax

I am very sorry for your loss.

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View solution in original post

TomK2023 · ‎March 6, 2023

Your inherited car is not taxable (no need to enter it anywhere).

Cryptocurrency airdrops are (usually) free distributions of coins or tokens into multiple wallet addresses to promote and drive adoption of a new virtual currency.

According to the IRS, airdrops (along with promos and staking rewards) only become taxable once the taxpayer "acquires the ability to transfer, sell, exchange, or otherwise dispose of the cryptocurrency." Airdropped currency that's not yet usable or accessible isn't taxable until the taxpayer can exercise control over it.

If you can access your crypto airdrop, follow these steps to report it in TurboTax.