You can easily report your crypto taxes on TurboTax with the help of CoinTracking. Import your trades into CoinTracking, we calculate your gain/losses, generate a ready-to-go tax report, and you can file your taxes using TurboTax.
But do you know how your crypto operations are taxed in the US? Do you know which tax forms you need for crypto? How to track your crypto taxes with CoinTracking and then file taxes with TurboTax?
Let's explore more about crypto taxes in the US and how to report them with the help of CoinTracking and TurboTax.
In this article:
Does CoinTracking work with TurboTax?
You can use CoinTracking to calculate your crypto gain/losses and generate tax reports into TurboTax to file your crypto taxes.
Here’s how to calculate your crypto gains with CoinTracking and download your data for TurboTax:
Import your crypto trades from 100+ exchanges into CoinTracking
We calculate your crypto gain/losses according to your desired accounting method (from 13 available)
Generate a tax report for the year
Click on “Load Report” and then select TurboTax from the options
If you have less than 2251 transactions (TurboTax limit), click on “Download your capital gains data” to download the file for TurboTax
If you have more than 2251 transactions, download the “capital gains data summarized”
How do I enter crypto in TurboTax?
You can download your capital gains data from CoinTracking and import it on TurboTax to file your crypto taxes. Here’s how:
Download the capital gains file and login into your TurboTax account
Select “Federal” in the left navigation bar and “Stocks, Cryptocurrency, Mutual Funds, Bonds, Other” at the right
Select “YES” on the page “Did you sell any of these investments in Year?”
Select “Cryptocurrency” and “Continue”
Select “Try another way”
Select “Upload it from my computer” and “Continue”
Select “Other” under Crypto service, add CoinTracking as “Name” and “Continue”
Upload your CSV file
How much crypto do you have to report on taxes?
In the US, if you trade crypto or NFTs, you’ll have a taxable event, subject to capital gains taxes.
If you earn crypto income from BTC mining, staking rewards, salaries, crypto interest, airdrops, or hard forks, you’ll have to report it like ordinary income in your income tax return. Learn more about how to report your crypto taxes.
If you’re an NFT creator instead of an investor, your sales proceeds from the NFT sales will be taxed as income instead of capital gains.
Other crypto activities like in DeFi can be more complicated, and they need to be determined on a case-by-case basis. Check this guide on DeFi taxes for more information.
How do I claim crypto on my tax return?
Here’s to claim crypto on tax return:
You have to answer the crypto question on Form 1040 if you traded crypto
Declare all of your crypto gains and losses on Form 8949 and Schedule D of your Form 1040
Report crypto income (e.g., airdrops, staking rewards) on Schedule B (for interest) or Schedule 1 (for miscellaneous income) of your income tax return.
Learn more about what tax forms you need for crypto and how to file your Form 8949 with your crypto gains.
What happens if you don’t report crypto on taxes?
If you don’t report your crypto taxes, you’ll face penalties, late fees, or even jail time in the US. According to IRS guidelines, you must report your crypto taxes if you traded crypto or earned crypto income.
How do I avoid crypto taxes?
You probably cannot totally avoid crypto taxes, but you can legally reduce your crypto taxes by:
Holding crypto in the long-term (over 12 months)
Donating crypto to a charitable organization
Applying the wash sale rule for crypto
If you’re a US resident, moving to a crypto-tax-friendly or no-income-tax state
Moving (physically) to Puerto Rico
Moving to another crypto-tax-friendly country (E.g., Portugal, Dubai, Switzerland)
Taking a crypto loan for investment and deducting the interest
Investing in crypto by using a self-directed IRA.
Delaying crypto taxes with specific identification instead of FIFO
Can the IRS find out about crypto?
Yes, the IRS has multiple and advanced tools to track your crypto holdings, enforce the law to freeze your crypto, apply fees over your late or misreporting of crypto, summon crypto providers to provide personal information, etc.
The best crypto tax software: CoinTracking
The best crypto tax software in the market is CoinTracking.
You can import your trades using CSV or API, track your gains/losses, and generate tax reports according to your preferred accounting method.
CoinTracking is your full crypto tax solution for:
DeFi and NFT support with our ETH+DEX importer.
25+ advanced reports, including which coins offer you a tax-free rate.
Automatic capital Gains, according to 12 accounting methods (e.g., FIFO, LIFO, HMRC, ACB), accepted worldwide.
Generating complete Tax Reports in your country.
Crypto taxes with no errors: CoinTracking Full Service in the US.
CoinTracking also offers a Full Service for US traders. A crypto reconciliation tax expert from Polygon Advisory Group, a leading US crypto tax firm, will review your CoinTracking account, help fix any errors, and ensure you submit your crypto tax reports error-free.
Do you have any crypto tax questions? Check the best guides:
Do you pay taxes on crypto margin trading?
How are rebase token protocols taxed?
Do you pay taxes on fan tokens?
What happens if you don't file your crypto taxes?
Do you pay taxes when trading stablecoins?
How is Yield Farming Taxed?
DeFi Taxes: The Complete Guide.
How to save taxes with a Bitcoin IRA.
Do you pay taxes for receiving Bitcoin tips?
Uniswap Taxes Guide
How to calculate taxes with Bitcoin dollar-cost averaging?
FIFO for crypto taxes? Implications of accounting methods.
NFT Taxes: The Complete Guide.
Is Bitcoin taxable? The ultimate guide for 2021 taxes.
How to reduce your crypto taxes?
Crypto tax loss harvesting: Here’s what you need to know
This post is part of the Crypto Taxes AMA series. Follow our weekly AMAs on Twitter where our expert CPA, Sharon Yip answers your crypto tax questions. You can download 35+ AMA crypto tax reports for free.
Disclaimer: All the information provided above is for informational purposes only and should not be considered as professional investment, legal, or tax advice. You should conduct your own research or consult with a professional financial advisor when investing.