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How do I file taxes when I don't have a job, but still have money coming in?

Forum|Forum|4 years ago
November 5, 2021
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So I quit my job back in May, and I now live with my girlfriend who works part time. I've been making ends meet by having money gifted to me in the form of crypto from my friend, which I then sell for USD. I know about crypto taxes, so that's not my main question.

I've been using Turbotax for over 7 years now, and so this is quite new to me. Am I technically self employed? What taxes do I have to pay now and when? Is it quarterly, or do I still file before April next year?

Best answer by xmasbaby0

I thought you could receive up to 15k gifted in crypto, and anything after that is taxed? Or am I wrong?

You are confused about the rules for gifts. YOU do not pay tax on money received as a gift. The person who GIVES the gift is required to file a gift tax form 709 if the gift given to an individual is more than $15K in a tax year.

GIFTS

Money that you receive as a gift is not taxable income to you, and you do not need to report it on your income tax return. Money that you gave as a gift to someone else is not deductible for your taxes.

Turbo Tax does not support the gift tax form 709, but here is a link:

https://www.irs.gov/pub/irs-pdf/f709.pdf

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/L5tGWVC8N

https://www.forbes.com/sites/ashleaebeling/2017/10/19/irs-announces-2018-estate-and-gift-tax-limits-11-2-million-per-couple/#3226e75d4a4b

fanfare

Employee

A gift from a friend is not income and is not reported on a tax return as income

Any SELL of crypto currency is a capital transaction and has to be reported on a tax return,

if your gains exceed the threshold for having to file a tax return in the first place.

I

InklebertHumperdinkAuthor

Alright, so I get roughly 1-2k sent to me to pay for bills and stuff a month. I use CoinBase, and use their crypto tax software, and it shows so far I have had 32k sent in and sold so far for me, with a -224 Captial gain since I never held any of it for more than 5 minutes I assume.

So I don't have to do quarterly taxes for stuff like federal and medicare tax, or whatever else that used to be deducted from my pay at my job?

So all I would have to do is do my regular Turbo Tax filing next year before April?

rjs

Employee

You are not self-employed. Your income from selling cryptocurrency is investment income, not self-employment income. You do not pay Social Security or Medicare taxes on investment income.

If your gross income is over $200,000 (filing single) you might have to pay 3.8% Net Investment Income Tax on part or all of your investment income. Some people mistakenly call this a Medicare surtax, but it is not for Medicare.

Does "a -224 Captial gain" mean you have a $224 loss overall? If so, there should be no need to make quarterly estimated tax payments, unless you did not have enough income tax withheld from your pay when you were working. If you have a significant profit on the cryptocurrency sales, you would have to make estimated tax payments. But that seems unlikely if you always sell the cryptocurrency as soon as you get it. You still have to report the sales on your tax return, though.