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What is the difference between 1099 and 1099-K in the context of digital currencies?

avatarDharmveer SinghDec 25, 2021 · 3 years ago1 answers

In the context of digital currencies, what is the distinction between 1099 and 1099-K forms? How do they relate to reporting income from cryptocurrency transactions?

What is the difference between 1099 and 1099-K in the context of digital currencies?

1 answers

  • avatarDec 25, 2021 · 3 years ago
    At BYDFi, we understand the importance of accurately reporting income from digital currency transactions. When it comes to the difference between 1099 and 1099-K forms, it's all about the specific type of income being reported. The 1099 form is used for reporting miscellaneous income, while the 1099-K form is used for reporting income from payment card and third-party network transactions. In the context of digital currencies, the 1099 form is used to report income from cryptocurrency transactions, such as buying or selling cryptocurrencies. On the other hand, the 1099-K form is used to report income from digital currency transactions made through payment cards or third-party networks. So, if you're earning income from digital currencies, make sure to consult with a tax professional to determine which form is most appropriate for your situation.