Short answer: in the US, income from renting out GPUs is generally taxable whether or not you receive a tax form, and Vast.ai does not withhold tax. Keep a monthly record of what your machines earned, what was paid out and what arrived, your costs, and when each machine went into service. Then you and your accountant can decide how to report it.

Track the income even if no form arrives

The IRS lists renting out equipment as one kind of gig work, and says you must report all income on your tax return, even if you do not receive a Form 1099. It also says you must file a return if your net earnings from self-employment are $400 or more, even from a side job. Source: IRS, Manage taxes for your gig work.

Vast.ai's tax guide for hosts says hosts are independent contractors who are responsible for tracking and reporting their earnings, and that Vast.ai does not automatically withhold taxes.

Which tax forms might arrive

  • Stripe. Vast.ai says Stripe issues tax forms through Stripe Express if you qualify, so keep your name, address and SSN or EIN current there.
  • PayPal. PayPal issues tax forms directly to qualifying users.
  • Wise. US hosts paid through Wise send their W-9 to Vast.ai.

Under current IRS guidance, payment apps and online marketplaces file Form 1099-K when a payee has more than $20,000 in payments and more than 200 transactions in a calendar year. Source: IRS, Form 1099-K FAQs. The IRS also notes that the gross amount on a 1099-K is not adjusted for fees, refunds or other amounts, so it may not match what reached you. Source: IRS, What to do with Form 1099-K.

Business or not: where the income may go

How GPU hosting is classified depends on your facts, so treat this as background for a conversation with your accountant. IRS Topic 414 says income from renting personal property goes on Schedule C if you are in the business of renting personal property. If you are not, the income goes on line 8l and the expenses on line 24b of Schedule 1. Source: IRS Topic no. 414, Rental income and expenses.

The Schedule C instructions describe a business as an activity carried on for profit with continuity and regularity. A sporadic activity or a hobby does not qualify. Source: IRS, Instructions for Schedule C. If your hosting is a business, Schedule SE for self-employment tax may also apply, and IRS Publication 334 covers small businesses that file Schedule C.

Costs hosts usually keep records for

  • Electricity. A separate meter, or a written method for splitting a shared bill between hosting and personal use.
  • Internet. The same: the bill, and how you split it.
  • Hardware. Invoices for GPUs, servers and parts, with the date each one was put in service.
  • Repairs and replacement parts. Receipts, and which machine they were for.
  • Platform and payout records. Your Vast.ai earnings and Payout History, and the matching receipts in Wise, PayPal or Stripe.

Whether and how each cost can be deducted depends on how your activity is classified. Keep the records either way.

Depreciation of GPU servers

For US tax, IRS Publication 946 lists computers and peripheral equipment as 5-year property under MACRS. The section 179 deduction and bonus depreciation may also be available, and the choice depends on your situation. Depreciation for tax and depreciation in your own books can differ. For how a monthly book schedule works, the steps in how to depreciate ASIC miners apply to GPU servers too.

Estimated taxes

Because nothing is withheld, US hosts may need to pay estimated tax during the year. The IRS says individuals generally have to make estimated tax payments if they expect to owe $1,000 or more when they file, in four payment periods. Source: IRS, Estimated taxes.

Outside the US

Vast.ai does not provide tax documents or tax advice to hosts outside the United States, and it does not currently collect or remit VAT or show VAT on its invoices. How hosting income, equipment and VAT are treated depends on your country, and sometimes your region, so ask a local accountant. Keep the same records described above, plus any currency conversion between USD and your home currency, with the date and rate used.

A monthly record that makes year-end simpler

Whatever your country, the same four things come up at year-end: what your machines earned, what was paid out and when it arrived, what the hosting cost, and the machines you own. Closing each month with those four lists means your accountant starts from records, not from memory.

Flash keeps that monthly record for compute operators. It does not file taxes or give tax advice. To track and confirm each Vast.ai payout, see how Vast.ai host payouts work and the Vast.ai connection, in early access. If you host GPUs, see Flash for GPU operators. If you also mine Bitcoin, see Flash for miners. If an accountant keeps your books, Flash for Accountants explains how they work with Flash.

Questions

Do I have to pay tax on GPU rental income from Vast.ai?

In the US, generally yes. The IRS says you must report all income on your tax return, even if you do not receive a Form 1099. Vast.ai does not withhold tax. Outside the US, check your local rules. This is general information, not tax advice.

Will I get a tax form from Vast.ai?

For US hosts, Vast.ai says Stripe and PayPal issue tax forms directly if you meet their reporting thresholds, and US hosts paid through Wise send their W-9 to Vast.ai. Vast.ai does not provide tax documents to hosts outside the US.

When does a payment platform send a Form 1099-K?

Under current IRS guidance, a payment app or online marketplace files Form 1099-K when a payee has more than $20,000 in payments and more than 200 transactions in a calendar year. The gross amount on the form is not reduced for fees. You still report income below that threshold.

Is GPU rental income reported on Schedule C?

It depends on your facts. IRS Topic 414 says income from renting personal property goes on Schedule C if you are in the business of renting personal property, and on Schedule 1 if you are not. Ask a tax professional which applies to your hosting.

Does Vast.ai charge or show VAT?

Vast.ai says it is based in California and does not currently collect or remit VAT, and VAT is not currently shown on its invoices. If you are VAT registered, ask an accountant in your country how to treat your hosting income.

How are GPU servers depreciated for US tax?

IRS Publication 946 treats computers and peripheral equipment as 5-year property under MACRS. Other elections, such as the section 179 deduction or bonus depreciation, may apply. Which method suits you is a question for your tax professional.

What records should a GPU host keep?

Keep your Vast.ai earnings and Payout History exports, the receipts in Wise, PayPal or Stripe, any tax forms you receive, hardware invoices with the date each machine was put in service, and electricity and internet bills with how you split them between hosting and personal use.

General information, not tax advice. Flash is the CFO layer for compute operators: Bitcoin miners and GPU hosts. See Flash for GPU operators.