Did You Deal in Virtual Currency in 2021? The IRS Wants a Yes or No Answer

investopedia.com:

This year the Internal Revenue Service (IRS) has a question for you this year: «At any time during 2021, did you receive, sell, exchange, or otherwise dispose of any financial interest in any virtual currency?»The agency requires you to answer «Yes» if you did or «No» if you did not.

All taxpayers must answer the virtual currency question on their respective tax form for tax year 2021 whether they dealt in virtual currency or not.

Here's what's behind the question. If you sell or exchange virtual currency or use it to pay for goods or services or hold it as an investment, there may eventually be tax consequences that could result in tax liability.

And the answer to the 2021 IRS virtual currency question isn't as simple as it seems:

No matter what, everyone who files Form 1040, Form 1040-SR, or Form 1040-NR has to answer the question by checking the appropriate box. No exceptions.

If you disposed of virtual currency you owned and held as a capital asset during 2021, you must check the «yes» box on Form 1040, use Form 8949 to calculate your capital gain or loss, and report it on Schedule D (Form 1040).

Virtual currency you received as compensation for services or virtual currency you held and sold to to customers in a trade or business must be reported as income in the proper place, i.e., as wages on Form 1040, 1040-SR, or 1040-NR, line 1 or on Schedule C (Profit or Loss from Business). Some other common instances in which you must check the «Yes» box in response to the virtual currency question include:

If you had no financial interest in—or ownership of—virtual currency during 2021, you can check the «No» box. If you owned virtual currency or acquired it by purchasing it or as a bona fide gift, and did not engage in any