The IRS Will Ask Every Taxpayer About Crypto Transactions This Tax Season — Here’s How To Report Them

Cryptocurrencies, also known as virtual currencies, have gone mainstream. That’s for sure. For example, you can use bitcoin BTCUSD, -0.35% to buy a Tesla TSLA, +1.75% and to buy or pay for lots of other things. However, using cryptocurrencies has federal income tax implications. Here’s what you need to know at 2021 tax return time if you made crypto transactions last year.

Understand this: the IRS wants to know about your crypto transactions
The 2021 version of IRS Form 1040 asks if at any time during the year you received, sold, exchanged, or otherwise disposed of any financial interest in any virtual currency. If you did, you are supposed to check the “Yes” box. The fact that this question appears on page 1 of Form 1040, right below the lines for supplying basic information like your name and address, indicates that the IRS is serious about enforcing compliance with the applicable tax rules. Fair warning.

When to check the ‘Yes’ box on crypto transactions
The 2021 Form 1040 instructions clarify that virtual currency transactions for which you should check the “Yes” box include but are not limited to: (1) the receipt of virtual currency as payment for goods or services that you provided; (2) the receipt or transfer of virtual currency for free that does not qualify as a bona fide gift under the federal tax rules; (3) the receipt of new virtual currency as a result of mining and staking activities; (4) the receipt of virtual currency as a result of a hard fork; (5) an exchange of virtual currency for property, goods, or services; (6) an exchange/trade of virtual currency for another virtual currency; (7) a sale of virtual currency; and (8) any other disposition of a financial interest in virtual currency.

If in 2021 you disposed of any virtual currency that was held as a capital asset through a sale, exchange, or transfer, check the “Yes” box and use familiar IRS Form 8949 and Schedule D of Form 1040 to figure your capital gain or loss. See Examples 1 and 4 below.

If in 2021 you received any virtual currency as compensation for services, check the “Yes” box and report the income the same way as you would report other income of the same nature. See Example 3 below.

When to check the ‘No’ box on crypto transactions
You cannot leave the virtual currency transaction question unanswered. You must check either the “Yes” box or the “No” box.

A transaction involving virtual currency does not include holding virtual currency in a wallet or account, or the transfer of virtual currency from one wallet or account that you own or control to another that you own or control. If that’s all that happened last year, check the “No” box.

Also check the “No” box if your only virtual currency transactions in 2021 were purchases of virtual currency for real currency, including the use of real currency electronic platforms such as PayPal PYPL, -1.43%.

Source: MarketWatch

Why Jakarta Is Sinking

The 400-year curse dragging Indonesia’s capital into the sea.

Like many coastal cities around the world, Jakarta is dealing with sea level rise. But Indonesia’s biggest city also has a unique problem: Because of restricted water access in the city, the majority of its residents have to extract groundwater to survive. And it’s causing the city to sink. Today, Jakarta is the world’s fastest-sinking city.

The problem gets worse every year, but the root of it precedes modern Indonesia by centuries. In the 1600s, when the Dutch landed in Indonesia and built present-day Jakarta, they divided up the city to segregate the population. Eventually, that segregation led to an unequal water piping system that excluded most Indigenous Jakartans, forcing them to find other ways to get water.

To understand how it all ties together, and what’s in store for Jakarta’s future, watch the video above.

Photographer Nate Gowdy Captured Images Of The Chaos Outside The Capital – ‘Still Processing What I Witnessed’

Photographer Nate Gowdy has documented close to 30 official Trump rallies since 2016, so he thought he knew what to expect when he arrived in Washington, D.C. after leaving Atlanta this week.

“My flight from Atlanta to Baltimore the night before should’ve prepared me for what would be one of the most surreal scenes I’ve documented,” he explains. “I’d never been aboard a plane where the dichotomy of people’s views was so starkly apparent, with people donning red hats and Trump merch side by side with people just getting from one place to the other.”

A chant of “Four More Years” began and was booed by others on the plane, which then resulted in someone shouting: “Go back to Venezuela!”

After the events of January 6th, when a mob of Trump supporters breached the Capitol and swarmed for hours until they were ejected from the government building, Gowdy states: “I’m still processing what I witnessed yesterday. We all are. It’s difficult to know what people are thinking when they’re breaching security barriers, attacking law enforcement, threatening members of the media, flaunting pandemic safety protocols, and bashing down the doors and windows to Congress, feeling enabled by the words they’ve just heard uttered from their ringleader, the President of the United States, who tells them that they are fighting the good fight. Throughout the afternoon, I heard countless individuals quipping how it was the best day of their life, and that it was one for the history books. How do you capture something so unprecedented, particularly when you don’t believe the ‘truths’ they do?”

Source: Rolling Stone