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Level 2
posted Feb 11, 2022 6:18:39 AM

What do I answer for Did I do cryptocurrency, I made $6??

Hey so i was finishing my taxes and I was asked the question if i did cryptocurrency in 2021. The technical answer is yes I made $6 cause the platform i used refused to refund my $10 almost immediately after i put in the money cause i felt it was scammy. So I ended up making $6. I dont want to pay $70 to add this stupid $6 to my taxes. But if I put no its technically a lie so i don't know what to do here. I can't afford another $70 thats a $64 loss and I need it to pay my debt! if i put yes even if turbotax doesnt ask me the amount doesnt it flag my return? I dont want to get audited for a stupid $6 they can have the $6!

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1 Replies
Expert Alumni
Feb 13, 2022 7:46:26 AM

The cryptocurrency question is a required answer on the 2021 Federal 1040 tax return.  The question on the 2021 Federal 1040 reads:

 

At any time during 2021, did you receive, sell, exchange, or otherwise dispose of any financial interest in any virtual currency?

 

The IRS explains how to answer the question on page 17 of the 1040 instructions here.

 

A transaction involving virtual currency includes, but is not limited to: 

  • The receipt of virtual currency as payment for goods or services provided; 
  • The receipt or transfer of virtual currency for free (without providing any consideration) that does not qualify as a bona fide gift; 
  • The receipt of new virtual currency as a result of mining and staking activities; 
  • The receipt of virtual currency as a result of a hard fork; 
  • An exchange of virtual currency for property, goods, or services; 
  • An exchange/trade of virtual currency for another virtual currency; 
  • A sale of virtual currency; and 
  • Any other disposition of a financial interest in virtual currency.