I just finished filling my taxes. Been in the crypto game since 2017 and have always been 100% confident in what I reported. This year was different though. I made a lot of NFT sales this past year and after wading through the 1000s of transactions my brain went to goo. I wasn’t able to reconcile all my transactions. Especially the one’s coming from niche exchanges that don’t even have transaction export’s available. I filed anyway.
Anyone have any experience with an IRS?
I feel confident that i can demonstrate that i filed in good faith but I don’t think being inept is a solid defense. I’ve used programs like coin tracker but those have severe limitations when it comes to the crypto gaming space.
What is the worst that could happen?
Could i just pay a fine and be done with it?
Even if the IRS accepts this year could I be screwing myself down the line if i am inaccurate in my filing this year?
Please talk me off the ledge. There is no way i can track all the buys/sells/rewards/transfers/etc.
How can you even calculate something like this for taxes.
Purchase 10 packs of NFT trading card packs. 1 card is worth $1000 but the others are all worth $.20. I combine all 49 the other .20 cards to create 5 cards that are all worth 2. Then i sell those cards to get in game coin and i purchase potions that improves the odds of opening better cards in future pack purchases. I buy one more pack and i get another $1000 card.
My theory is that all of that is irrelevant. The IRS just needs to know that i spent $100 usd on nfts and eventually i sold them and got $2000 usd back.
Well thats what i tried to do and turbo tax and all other programs are firing up all these error messages saying that there are missing transactions.
And thats an easy example. What about card rental income. Those transactions happen in the millions and millions.
Ugggghgggggggg. I hate all of this. About to dump all my bags next year so i never have to deal with this anymore.
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