I gifted an NFT that I bought in 2021 to a friend in 2022. The NFT wasn’t worth very much, maybe $10 or so. I did not receive anything in return. Do I have to answer yes on the crypto tax question on form 1040?
Question: “At any time during 2022, did you (a) receive (as a reward, award, or payment for property or services); or (b) sell, exchange, gift, or otherwise dispose of a digital asset (or a financial interest in a digital asset)?”
Since the NFT is a gift and the amount of the gift is under the gift tax limit, I don’t think I would have to report it on form 8949. However, would it trigger an audit if I answered “Yes” and did not include any NFT/crypto transactions on the 8949?
1 thought on “Do I answer yes to the crypto tax question if I gifted an NFT to someone”
Safest answer is to answer yes, but I would include an explanation with it.
I think most tax software programs will then require an 8949.