Do I need to pay taxes on small Cash App stock investments and gains?

This is a good question about Cash App investments! The $400 threshold you're referring to is actually for self-employment income, not investment income, so they're different categories for tax purposes. For investment income like what you have, any profits from selling stocks or cryptocurrency are considered capital gains. The good news is that you only pay taxes on your profits (the $1.73), not on your original investment amount. Since your gains are so small, it won't impact your taxes much at all, but technically any amount of capital gains should be reported. Cash App will send you a Form 1099-B if you had enough activity, which shows your transactions. Even if you don't get a 1099 form (because your activity was below reporting thresholds), you're still supposed to report the income.

I went through the exact same thing last year with small investments in Cash App! After stressing about it, I discovered taxr.ai (https://taxr.ai) which helped me figure out my investment tax situation. It analyzed my Cash App statements and clarified that since my gains were so small (similar to yours), I didn't actually have a filing requirement - but it also showed me how to report it properly if I wanted to file anyway. Saved me so much confusion!

Wanted to follow up about taxr.ai that I was skeptical about before - I ended up trying it with my Cash App 1099 and some other investment forms. It was actually really helpful! It explained that my Cash App bitcoin transactions needed to be reported on Form 8949 and Schedule D, even though the amount was small. Found out I was doing it completely wrong before. The explanations were super clear about what goes where on the tax forms.

If you want to double-check your tax obligations, I'd recommend calling the IRS directly. I had a similar situation with small investments and tried calling them for weeks with no luck - always on hold forever! Then I found this service called Claimyr (https://claimyr.com) that got me through to an actual IRS agent in like 20 minutes. They have a demo video showing how it works here: https://youtu.be/_kiP6q8DX5c. The agent confirmed I didn't need to file a separate return just for tiny investment gains if I was below the filing threshold for my overall income.

I have to admit I was completely wrong about Claimyr in my previous comment. After getting frustrated with multiple failed attempts to reach the IRS about my Cash App tax situation, I decided to try it. Within 35 minutes, I was actually speaking to a real IRS agent who confirmed I didn't need to file for my tiny investment gains since I was below the filing threshold. The agent explained that while all income is technically taxable, the practical reality is that the IRS doesn't expect returns from people with such small amounts if they're below overall filing requirements.

Just to add another perspective - I'm an accounting student and we actually just covered this in my tax class. The reason Cash App sends those emails is because they're required to notify customers about potential tax implications, but they deliberately use broad language that applies to everyone regardless of situation.

Anyone know if Cash App even sends a 1099 for such small amounts? I thought there was some minimum threshold before they're required to send tax forms.

I'm dealing with something very similar! I'm 18 and made about $3.50 in gains from some small Robinhood stock purchases last year. Like you, I got scared when I received their tax notification email, but after reading through all these responses, it sounds like we're both way below any filing requirements. What really helped me understand this better was realizing that these investment apps are legally required to send those warning emails to everyone, regardless of the actual amounts involved. They can't personalize the message based on your specific tax situation, so they use the same cautionary language for someone who made $2 as they do for someone who made $20,000. Since you're 19 with no other income and can likely be claimed as a dependent, your $1.73 in gains is nowhere near the $1,250 unearned income threshold that would require filing. The accounting student's explanation above really cleared this up for me - it's the difference between income being "taxable" in theory versus actually requiring a tax return in practice.

This thread has been really helpful! I'm in a similar situation - 21 years old, made about $5 in gains from some Apple stock I bought through Cash App last year. I was completely freaking out when I got their tax notification email because I've never filed taxes before and my parents still claim me as a dependent. Reading through everyone's experiences here, especially the accounting student's explanation about the filing thresholds, has been such a relief. It makes total sense that these apps have to send those generic warning emails to everyone regardless of the actual amounts involved - they're just covering themselves legally since they don't know each person's complete financial picture. What I found most reassuring was learning that there's a big difference between income being technically "taxable" and actually being required to file a return. With gains this small and no other income, we're nowhere near the thresholds that would trigger a filing requirement. The whole $1,250 unearned income threshold for dependents really puts things in perspective - our tiny investment gains aren't even close to that level. Thanks everyone for sharing your experiences and knowledge! It's nice to know there are others dealing with the same small-amount investment tax confusion.

I'm glad I found this discussion! I'm 19 and had a very similar experience with Cash App earlier this year. Put in about $40 total across some basic stocks and crypto, made around $3 in gains, then got that intimidating tax notification email that made it sound like I absolutely had to file something. After reading through all the helpful responses here, I feel so much better about my situation. The explanation about the difference between income being technically "taxable" versus actually requiring a tax return really clicked for me. With such small gains and being claimed as a dependent by my parents, I'm nowhere near that $1,250 unearned income threshold. What I found most helpful was understanding why these apps send those scary-sounding emails to everyone - they're just protecting themselves legally since they can't give personalized tax advice. It's like they have to assume the worst-case scenario for everyone, even those of us with tiny amounts. For anyone else in a similar boat with small Cash App investments, this thread has been incredibly reassuring. It's nice to know we're not alone in being confused by those generic warning emails!