Easy ways to create passive income on your Crypto!!!

**Arky** · 01-29-22, 01:34 PM

I would say hang onto all your CRO. If the price of CRO goes to $2, $4 or even $10, that will make upgrading to the next level cheap and easy. Might not happen this year but it could happen sometime in the future...

Please be aware that Crypto.com will send you a 1099K if you meet certain thresholds. I got one this year and it's kinda ridiculous looking. $2M in transactions in one month? Eheh, I wish. I believe they calculate by totaling all transactions. I didn't get one of these last year but they sent me one this year. I'm in the process of finding a good crypto tax preparer and I expect they will not be cheap.

Likewise, Celsius will send you a 1099-MISC if you earn over $600. Got one of them, too.

I will probably continue to stake on Crypto.com but the best passive income is the one where you are in control of the staking - not letting a custodian do it.

**Rabiddog33** · 01-29-22, 01:58 PM

Originally posted by Arky

I'm in the process of finding a good crypto tax preparer and I expect they will not be cheap.

I've used "Token Tax" the last 2 years. I'd try them first before you try and find someone. You just either connect to the exchange through and API or download CSV's and put those in. I have a decent amount of wallets I had to put in my biggest issues came from Bybit and Kucoin. I'm already done with this years taxes.

**Arky** · 01-29-22, 02:37 PM

I'll give them a look. Thanks.

Did you use them in conjunction with Turbo Tax?

**Rabiddog33** · 01-29-22, 03:03 PM

Originally posted by Arky

I'll give them a look. Thanks.

Did you use them in conjunction with Turbo Tax?

Yes

**themike78** · 01-29-22, 06:48 PM

Originally posted by Arky

I would say hang onto all your CRO. If the price of CRO goes to $2, $4 or even $10, that will make upgrading to the next level cheap and easy. Might not happen this year but it could happen sometime in the future...

Please be aware that Crypto.com will send you a 1099K if you meet certain thresholds. I got one this year and it's kinda ridiculous looking. $2M in transactions in one month? Eheh, I wish. I believe they calculate by totaling all transactions. I didn't get one of these last year but they sent me one this year. I'm in the process of finding a good crypto tax preparer and I expect they will not be cheap.

Likewise, Celsius will send you a 1099-MISC if you earn over $600. Got one of them, too.

I will probably continue to stake on Crypto.com but the best passive income is the one where you are in control of the staking - not letting a custodian do it.

Yeah crypto.com sent me some i.r.s form also. I've bought about $30,000 of bitcoin from them last year. So do I have to pay the I.R.S now? Fuk this.

**Arky** · 01-29-22, 08:24 PM

Originally posted by themike78

Yeah crypto.com sent me some i.r.s form also. I've bought about $30,000 of bitcoin from them last year. So do I have to pay the I.R.S now? Fuk this.

Yep, you get a form, better take action and address it because they will know.

The "rules" for crypto taxation are screwy - you can tell they weren't written by crypto users. Just Uncle Sam's henchmen sticking it to the little guy every step of the way....

**wombat** · 01-29-22, 10:38 PM

Originally posted by themike78

Yeah crypto.com sent me some i.r.s form also. I've bought about $30,000 of bitcoin from them last year. So do I have to pay the I.R.S now? Fuk this.

I got the same form. It only shows I purchased Bitcoin but not selling. You only get taxed if you make a profit selling.

**Arky** · 01-29-22, 11:20 PM

Just got an email from Crypto.com saying the 1099K they sent me was incorrect - that they will issue a corrected form by Jan 31. Not sure if this goes for everyone....

(apologies to the thread starter for getting off topic).

**wombat** · 01-30-22, 10:03 AM

If you purchased Bitcoin through crypto.com but never sold it, you don't get taxed for that. Its the same rules as stocks, you only get taxed when you sell it for a profit.

If you get audited, you can show them proof that you sent the Bitcoin for gambling purposes and never sold for a profit. The IRS will get inundated with forms in the first few years of this so I doubt they will audit anyone until they get a grasp on how crypto works.

**Rabiddog33** · 01-30-22, 11:45 AM

Originally posted by wombat

If you purchased Bitcoin through crypto.com but never sold it, you don't get taxed for that. Its the same rules as stocks, you only get taxed when you sell it for a profit.

If you get audited, you can show them proof that you sent the Bitcoin for gambling purposes and never sold for a profit. The IRS will get inundated with forms in the first few years of this so I doubt they will audit anyone until they get a grasp on how crypto works.

Once you send it to a gambling site it is a tax event, because your selling it. You might have a loss or a small gain but it's still a tax event. Using a tax service like Token Tax can help you figure it out. You'd have to do some adjusting with data because they don't know you sold it. You'd call it a spend in there data instead of a withdrawal. Then when you get paid by a sportsbook you right it in as a trade USD to BTC instead of a deposit.

If your making any sort of money in Crypto you should start claiming because you do have trail coming out of these exchanges.

**Arky** · 01-31-22, 01:08 PM

For the LUNA owners:

Terra (LUNA) has passive income. No custodian needed. Staking LUNA currently returns 8.56% APY. Terra Station wallet setup tutorial here. (Note: Ledger owners can no longer use the desktop version of the Terra Station wallet but instead must use the web app).

TerraUSD (UST) is Terra's stablecoin and can also be staked - it is currently returning 19.45% APY. Rated as one of the most algorithmically stable of the stablecoins and has been moving up the charts (#16 @ CMC). Deposit UST in the Anchor web app.

Anchor and Mirror are two of the best airdrops on the Terra network and come about once/week to 8 days. Airdrop timer for those two found here. All airdrops found here.

**wombat** · 02-01-22, 09:20 AM

Received an email from crypto.com today. They revised the previous form that was sent regarding crypto purchases through your card. They are only issuing a form if you made a net profit of $600 or more through your transactions.

It was as I expected. You only pay taxes on net profit, not on your purchases.

**wombat** · 02-01-22, 09:25 AM

Dear Valued Customer,

You are receiving this email because you received a Form 1099-K. Please disregard this form. We have issued Form 1099-MISC to users who meet the criteria, which includes the following:

You are a Crypto.*com user;
You are a US person for tax purposes; and
You have earned $600 or more in qualifying miscellaneous income from Crypto*.com in 2021.
If you did not receive a 1099-MISC, you did not meet the criteria. Please consult with your tax expert, CPA, or tax attorney on how you should treat reporting of digital currency activity. The information contained in Form 1099-MISC will be the only information shared with the IRS by Crypto.*com.

**JAKEPEAVY21** · 02-01-22, 09:28 AM

I stake BTC and ETH at Nexo.io

**Rabiddog33** · 02-01-22, 11:50 AM

Originally posted by wombat

Received an email from crypto.com today. They revised the previous form that was sent regarding crypto purchases through your card. They are only issuing a form if you made a net profit of $600 or more through your transactions.

It was as I expected. You only pay taxes on net profit, not on your purchases.

The IRS considers Credit or debit card rewards NOT income. So the rewards should not be taxed, but profit made from those rewards should be taxed.

**Rabiddog33** · 02-01-22, 11:51 AM

Originally posted by JAKEPEAVY21

I stake BTC and ETH at Nexo.io

You can increase your percentages by holding nexo tokens also.

**JAKEPEAVY21** · 02-01-22, 01:04 PM

Originally posted by Rabiddog33

You can increase your percentages by holding nexo tokens also.

Yep, I'm thinking about doing that but with my luck they will all go to shit after I make a trade for some haha.

**Rabiddog33** · 02-01-22, 01:49 PM

Originally posted by JAKEPEAVY21

Yep, I'm thinking about doing that but with my luck they will all go to shit after I make a trade for some haha.

To get the extra 5% staking your nexo token you have to do it for a year. If you have long term outlook, I think all these app lending tokens will be worth a lot more. It's in the best interest of these sites that there token increases over time.

**themike78** · 02-01-22, 06:02 PM

Originally posted by Arky

Just got an email from Crypto.com saying the 1099K they sent me was incorrect - that they will issue a corrected form by Jan 31. Not sure if this goes for everyone....

(apologies to the thread starter for getting off topic).

On my first form I received it says I bought 65,000 worth of crypto last year which is completely wrong. I know it was no more than 35,000. Then I got the email saying it was incorrect and I would receive a new 1099 form. Still nothing new received. I think these guys are clueless about this just like me. I'm just going to hire an accountant and show him the statements. This stuff is confusing as hell.

**Arky** · 02-01-22, 07:12 PM

Originally posted by themike78

On my first form I received it says I bought 65,000 worth of crypto last year which is completely wrong. I know it was no more than 35,000. Then I got the email saying it was incorrect and I would receive a new 1099 form. Still nothing new received. I think these guys are clueless about this just like me. I'm just going to hire an accountant and show him the statements. This stuff is confusing as hell.

Yep, first Crypto.com sent me a 1099K which was ridiculous looking - 1/2 million dollars in transactions in one month then $3K the next month? Eheh. Then, I got the email some of the others got that said they were going to send a 1099-MISC instead. Got the 1099-MISC and it has one number on the whole form - the amount I probably earned by staking all year. I think the 1099-MISC is what a bank will send you when you earn interest in a banking account. (Edit: or is that the 1099-INT?) At any rate, they're both kinda easy to deal with.

I think I'm going with a CPA until I wrap my head around all the nuances of crypto taxation. I have an appointment tomorrow. Whether they charge $1000, $2000, whatever, it is probably a good idea to hire a guy and stay out of jail. Can't do much good if I'm locked up in a cage.

I will have to cash out some crypto probably to pay my tax. Of course, this will generate a new taxable event for 2022. Something is wrong with that picture.....

**wombat** · 02-03-22, 09:49 AM

Received this email from Coinbase:

"You won’t be receiving any tax forms from us since you had no taxable activity on Coinbase in 2021.

There could be many reasons why you don’t have any taxable events, even though you had activity in your account in 2021. For example, the following are not considered taxable events:

You bought crypto with cash and held it

You transferred crypto between wallets

You transferred crypto between Coinbase accounts, or

You donated crypto to a qualified tax-exempt charity or non-profit"

Told you fellas, if you purchase crypto and just transferred it out to another wallet, that is not a taxable event.

**Arky** · 02-03-22, 12:49 PM

I think the game just changed and it is good news.

Toby reporting the IRS has sent an update out about staking - that it is not taxable until you spend it. View that here.

Forbes article here.

If this is true, then the two 1099-MISC's (other income) I received are moot and mean nothing. I'm going to have to talk to my tax guy and see what he says....

**Arky** · 02-05-22, 05:53 PM

Originally posted by Arky

I think the game just changed and it is good news.

Toby reporting the IRS has sent an update out about staking - that it is not taxable until you spend it. View that here.

Forbes article here.

If this is true, then the two 1099-MISC's (other income) I received are moot and mean nothing. I'm going to have to talk to my tax guy and see what he says....

A little more on this:

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https://cryptoonow.com/what-the-irs-court-case-over-crypto-staking-taxes-really-means/

"The guidance clearly states that Bitcoin and cryptocurrencies are taxed as property. But per cryptocurrency lobbying organization Coin Center, Joshua Jarrett is “arguing that the rewards should be treated as newly created property (e.g. like ears of corn grown in a field) and therefore shouldn’t be taxed until he sells them.”

That’s a stance that crypto advocacy groups such as Coin Center agree with, as do the leaders of the Congressional Blockchain Caucus.

To be clear, even though the IRS has in this instance offered to pay back the Jarretts for collected taxes, there’s been no shift in the Treasury Department’s crypto tax policy. The U.S. district court case continues, and even a positive ruling for the couple won’t automatically mean stakers get to stop paying taxes.

But Coin Center and the Proof of Stake Alliance both see the IRS’ offer as hopeful, with the latter group calling it a “sign that the IRS may no longer attempt to tax tokens created through staking moving forward.”

So, it seems as though until the IRS issues bona fide guidance about staking (and the exchanges and interest-earning wallets quit sending us 1099-MISCs), most will still have to pay tax on it. When they do issue guidance and if it turns out favorable, one can then request a refund. I do not expect the IRS to act quickly.

**ATC727** · 11-20-22, 05:23 PM

I received a tax bill from IRS saying I owe $15,000 from $40,000 worth of crypto transactions. All gambling related and never made a penny, I hired an attorney and seems like they are struggling To comprehend this.

if anyone has had success with these, please let me know.

thank you

**Arky** · 11-20-22, 08:27 PM

Originally posted by ATC727

I received a tax bill from IRS saying I owe $15,000 from $40,000 worth of crypto transactions. All gambling related and never made a penny, I hired an attorney and seems like they are struggling To comprehend this.

if anyone has had success with these, please let me know.

thank you

Don't know where you are at but if possible, seek out a good crypto CPA guy. If he's any good, he'll be able to sort it out for you. There will be a fee, of course, but it won't be anywhere near $15K. My guy does my complicated mess for less than $1K.

**statguy** · 11-22-22, 11:26 AM

BISq

All you need to know if you are serious about Bitcoin.