I purchased ATOM with US Dollar $ . I didn't sell, just holding but it seems I received rewards by staking.
* My answer to the IRS question is still " NO " , right?
* Do I have to report the rewards I received as income? If so, where should I report?
Thank you so much!
The IRS has not issued explicit guidance on how staking is taxed. However, most tax experts agree that rewards will be taxed as income at the time of the receipt based on previous IRS guidance on mining taxes.
this would go on schedule 1 line 8Z
@Kiki if ATOM is a virtual currency, your answer to the question is 'yes'.
the question asks if you had a transaction - and a 'transaction' is a "buy' or a 'sell'.
you state your PURCHASED ATOM, so that is a transaction.
A5(a). If your only transactions involving virtual currency during 2021 were purchases of virtual currency with real currency, you are not required to answer “yes” to the Form 1040 question, and should, instead, check the “no” box.
If you only bought crypto in 2021 then you will answer NO for 2021 ... last year the 2020 question was worded differently ...
@Critter-3 and the language in the 2022 draft changes it again.....
https://www.irs.gov/pub/irs-dft/f1040--dft.pdf
"(b) sell, exchange, gift, or otherwise dispose of a
digital asset
(or a financial interest in a digital asset)?"