Jan 19, 2022

Double money whammy

Double money whammy
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93
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Jan 19, 2022
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💰 Crypto
💰 Money
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309
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I’m feeling down.
One of the crypto projects that I “invested” a large sum in closed down this week due to poor market conditions and unsustainability. The dev team was honest enough to return funds according to the backing price. Unfortunately, I had lost almost half of what I put in. Which isn’t that bad, considering I would have lost a similar amount due to how the entire crypto market went down recently. So it turned out I was pretty lucky, given the number of projects out there that completely closed down without returning funds, or are outright complete scams.
Then I had an expensive consulting call about crypto taxes. I was told that my crypto activity last year were as complex as a hedge fund, and that the tech hasn’t been built yet to automatically calculate NFTs and DeFi data on alternative blockchains (that aren’t Bitcoin or Ethereum). Turns out my usage was very fringe. It would be super expensive to pay them to do it for me, possibly as much as the profits I’ve made. So it looks like I’ll have to do a bunch of manual work myself to compile the transactions. But they said if I develop some handy scripts, they may even hire me.
I also learned that I’m supposed to pay taxes every quarter, or else I’ll owe penalty interest. So the best course of action for me may be to overpay the IRS right now, then sort everything out on extended filing deadlines, and hope the tech can catch up.
Not only did I just lose a large sum of money, I also have to pay a large sum to the IRS as soon as possible. 😔
On the plus side, the total amount of money involved is probably not enough to attract an audit.