Did you receive a 1099-K tax form this year? If you’ve never seen this form before and are unsure what to do with it, don’t freak out — we can help you understand your Form 1099-K and guide you through reporting any necessary income. How do I use my 1099-K when filing my tax return? TaxAct ® takes accurate tax reporting seriously. That’s why we’ve spent much time and care optimizing our 1099-K reporting this year. We’ve added more detailed questions about what your 1099-K was for so we can help pull the proper tax forms for you. First, we’ll ask you for information about what types of income you’ve earned this year: As you can see from the screenshot above, Form 1099-K appears in more than one place — typically, this form is used for those who are self-employed, operate a side hustle, or sell personal items online. You could also receive a 1099-K for real estate rentals and royalties or farming. If you received a 1099-K for goods you sold as a hobby, there is also a third opti...
The value of Bitcoin and other cryptocurrencies has undoubtedly seen better days. But there’s a small silver lining — if you sold crypto at a loss in 2022, you might be able to save on your tax bill this year. What is the definition of cryptocurrency? Cryptocurrency differs from traditional currency, like the U.S. dollar, because it doesn’t have any intrinsic value. It is a decentralized currency, meaning it isn’t issued by an authority such as the government but instead distributed by a peer-to-peer network. This allows crypto investors to trade their coins almost instantly without relying on a payment processor as the middleman. Cryptocurrency generally exists on a blockchain platform — a shared public ledger that records crypto transactions. Its value is highly volatile and depends on various factors, like the supply and demand of a particular digital currency. How does the IRS define cryptocurrency? For tax purposes, the IRS defines cryptocurrency as a digital asset and tre...
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