It’s that time of year again. And by that we mean, tax time!
At the risk of stating the obvious, cryptocurrency earnings are taxable. Hopefully that is not news to anyone. 😊
While some people in the cryptocurrency space would like to not be concerned about regulatory requirements and instead think that all these rules are different with cryptocurrency, StormX still must comply with all applicable regulations.
The US Internal Revenue Service (IRS) is the essential tax agency for StormX, and we want to remain on their good side. We pay taxes big-time, as well as paying our top-tier tax firm that helps guide us.
The rest of this post is for US-based persons. In a later blog post, we’ll discuss StormX tax topics for non-US (so-called foreign) persons.
For our US-based users, all accounts with cumulative payouts of $600 or more have to be reported to the Internal Revenue Service (IRS). As such, StormX is required to collect the appropriate taxpayer identification information (via IRS Form W-9) to enable us to report those earnings to the IRS.
We are utilizing a 3rd-party online service (www.tax1099.com) for this purpose to make it easier for our users to submit their information. Tax1099 is an IRS-authorized e-filing platform following privacy best practices (including IRS-compliant annual SSAE-16 Type II audits, high-end data encryptions, 256-bit bank-grade security standards, TIN masking, and 2FA authentication procedures).
As a given user approaches the $600 payout threshold, StormX will be sending out reporting notifications to that user. In order to ensure that we can properly comply with IRS regulations, StormX will put a temporary hold (a “Payout Hold”) on their payout ability until the W-9 form is completed via our tax1099 portal and then that fact is recorded in our database.
Please note that even if payouts are temporarily held, users can continue to earn rewards. To be clear, a temporary Payout Hold will never affect our users from being able to earn rewards. Payout Holds are only temporary until a user submits their W-9 information and we record that. Once the W-9 form is submitted, the temporary hold will be lifted and the ability to payout will continue, including a catch-up for those temporarily held earnings.
Thank you for your continued support of StormX’s mission to enable you to earn crypto in a multitude of ways!
Frequently Asked Questions:
- Will I receive a Form 1099 from StormX? If you completed the W9 and are either an individual, an LLC (that is not an S-corporation), or partnership, then yes, you will receive a 1099-MISC, typically in early February of each year.
- What if I’m not a US-based person? If you were requested to complete a W9 but are not US-based, please send an email to [email protected] with those details.
- What if I’m based in the US but my StormX account is for a business? Please complete the W9 and indicate the legal entity name and type of company. In some cases (i.e., an LLC that is an S-corporation, or a C-corporation) StormX will not send a form 1099-MISC.
- If I don’t receive a 1099-MISC from StormX, do I need to pay taxes on income from StormX? The answer depends on your situation. StormX does not provide tax filing advice and recommends you seek out IRS online guidance and/or discuss with a tax professional.
- Other questions? Please send them to [email protected].