Everything from upgrading your doors and windows or your air conditioner and getting a tax credit, to renting out a room and deducting that portion of your home expenses, to working a side handyman or cleaning gig, to spending some cold-wallet crypto to buy gold, to the cost basis of previously unreported gains, to getting married and deciding to file together - the IRS doesn’t know.
And some things are arbitrary, and you have to make the choice and then tell them what choice you made, and how you value it.
That’s true only for very simple situations.
Everything from upgrading your doors and windows or your air conditioner and getting a tax credit, to renting out a room and deducting that portion of your home expenses, to working a side handyman or cleaning gig, to spending some cold-wallet crypto to buy gold, to the cost basis of previously unreported gains, to getting married and deciding to file together - the IRS doesn’t know.
And some things are arbitrary, and you have to make the choice and then tell them what choice you made, and how you value it.