A version of the digital asset question below appears on Form 1065, U.S. Return of Partnership Income, Form 1120, U.S. Corporation Income Tax Return, and Form 1120-S, U.S. Income Tax Return for an S Corporation.
At any time during the tax year, did you: (a) receive (as a reward, award or payment for property or services); or (b) sell, exchange, or otherwise dispose of a digital asset (or a financial interest in a digital asset)?
You may be able to answer No to this question If you simply only owned or held digital assets in a wallet or account, but did not engage in any digital asset transactions during the year or purchased, but did not sell, digital assets using U.S. or other real currency, including through electronic platforms or transferred digital assets from one wallet or account you own or control to another wallet or account you own or control.
If you sell or dispose of digital assets, you need to be aware of compliance obligations. General tax principles that apply to property transactions apply to transactions using digital assets.
