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RE: 1040 Tax Form Crypto Questions
If Bitcoin gets pumped in December and than dumps in January, then all of a sudden everyone owes taxes on value that don't exist. This is exactly what happened in 2017/2018 and a lot of people blamed poor price action in April 2018 for this reason.
If your Bitcoin is worth a million dollars in December and is then worth 100k in April, you still owe taxes on a million dollars.
Taxes are not owed on assets unless sold.
Plus it is only on the gains so if someone paid $500K for the $1M BTC, the gain is only $500K. If the BTC was held more than a year, it is capital gains, less it is considered earned income (different tax rates).