On the website that I use for tax there are 2 options income and gift. If I am receiving Brave reward does it count as a gift or income?
It is a good question, pal.
Receiving crypto is not a taxable event. You recognize gains/losses for tax purposes when you sell it.
So it counts as a gift?
You haven’t explained what you have done with the BAT, that would help answer the question. Are you holding it, have you sold it, or converted it to another coin?
I held some BAT and I swap some for other coins. But I know swapping is taxable. The part I am confuse is what do I label the transaction when I receive the BAT from Brave gift or income?
Again, it is not a taxable event to receive cryptocurrency. It is neither a gift nor income, it is nothing because it is not taxable.
This might be off topic but on Coinbase earn it categorize their rewards as income. You know when you watch a video and take a quiz and then you earn the coin. Also the only two option they gave me is gift or income. So I am guessing it is gift since when picking gift it shows a nontaxable event.
The crypto you get from Coinbase Earn is also not taxable and should not be counted as income for tax purposes. Receiving ANY crypto and holding onto it is not a taxable event. Do nothing and report nothing on your taxes in these situations.
Ahhh ok thanks but I got one last question, off topic again. I recent connect my Geminin account this year and was wondering do I have to report the transaction I did this year to my 2021 tax?
hello. so in order to get the lowest possible tax rate, do i send the crypto to an exchange and leave it there for a year before i sell it? like when you sell stocks.
thank you for explaining this. i was thinking the same too that if i send my crypto to Gemini EARN, i will be taxed so instead i sent them to my wallet.
Yes if you hold a crypto or stock for a year or more and sell it, it will counts as long term capital gain. But you will still have to report what you got to the IRS.
Not a financial advisor.
And if the crypto was given to you, the cost basis for those capital gains will be zero.
you are asking legal and accounting/tax questions… this is probably not the place for that.