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What of the following do I put on the tax form that I got money from a website for viewing ads, donating money, turning gift cards into bitcoin, buying gold, putting money into a bitcoin savings acount, buying miningsweden mining shares, or handing money to a scammer? By the way I did not buy any bitcoins from an exchange.
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They tax the exact same things as if you'd done those things in Thai Baht, or Nigerian Dollars, or British Pounds. If you view ads, that's income. If you buy gold, and it appreciates, that's capital gains. If you buy a mining contract, the income minus depreciation is capital gains.
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TaxHawk finally has cryptocurrency filing instructions for the 2018 tax year:
Cryptocurrency
Where you report the income from cryptocurrency depends on how you received it.
Wages: Menu Path: Income > Common Income > Wages (W-2)
Investment: Menu Path: Income > Common Income > Stocks or Investments Sold (1099-B)
Mining: Menu Path: Income > Business Income > Business Income (Schedule C)
Virtual currency, also known as cryptocurrency or altcoin, is a medium of exchange that only exists digitally. It has no centralized authority but uses a decentralized system to record transactions and relies on cryptography to prevent counterfeiting and fraudulent transactions. Examples of cryptocurrencies are Bitcoin, Zcash, Litecoin, and Ethereum, just to name a few.
Income paid in cryptocurrency or earned by buying, selling, or mining cryptocurrency is subject to taxation by the IRS. You can read the direction the IRS has given in Bulletin 2014-21
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Where you enter cryptocurrency income depends on how you earned the income. We'll give you an overview of the possible places below.
Wages paid in cryptocurrency should be converted to U.S. dollars on the date of each payment by your employer and reported on your Form W-2. The conversion to dollars should have already happened before you get your W-2.
Income paid to you in exchange for goods and services that wasn't wages (for example, you were paid for a service performed as part of your self-employed business in cryptocurrency) should be converted to U.S. dollars on the date of each payment and reported along with any other self-employment income.
If you held cryptocurrency for investment, it should to be treated as a capital gain or loss.
If you mined cryptocurrency, earnings from this activity should be converted to U.S. dollars as of the date you receive it and be included as income. If you were self-employed for the cryptocurrency mining, the income needs to be reported as self-employed income.
So the other things are not taxed? – Riley Potts – 2015-11-22T20:43:11.367
Which things? Paying money to a scammer? I suppose they'd have to pay income tax and possibly sales tax, but somehow I don't think they'd put that down on their 1040. – Nick ODell – 2015-11-22T20:46:00.250
Ok and for donating money, turning gift cards into bitcoin, and putting money into a bitcoin savings acount? – Riley Potts – 2015-11-22T20:47:31.980
1Donating money could earn you a tax exemption, turning gift cards into bitcoin is income if you make money, and I'm not aware of any Bitcoin savings accounts that aren't thinly veiled high yield investment program scams. – Nick ODell – 2015-11-22T20:55:40.667
If I instead lose money then I don't report it at all right? – Riley Potts – 2015-11-22T21:00:29.680
If you gain money, then lose money, that can potentially be taxable. – Nick ODell – 2015-11-22T21:06:17.190
The bitcoin savings account I use is magnr-2.18% AER Interest Rate. Also what is tax exemption? – Riley Potts – 2015-11-22T21:50:17.583
There is one interesting Bitcoin tax loophole. It only works for individuals who have held Bitcoins for more than a year. If you acquired Bitcoin (either by buying it or mining it) a long time ago for a low price and donate it to charity today, you can claim a charitable deduction for the present value of the Bitcoins without having a taxable gain for the appreciation. You cannot sell the Bitcoins and then donate the proceeds, you must donate the Bitcoins. (And please, consult with a tax expert to make sure there isn't some reason this won't work for you.) – David Schwartz – 2015-11-25T11:56:52.070