How to report crypto taxes with TurboTax?

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.

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:

1. Import your crypto trades from 100+ exchanges into CoinTracking
2. We calculate your crypto gain/losses according to your desired accounting method (from 13 available)
3. Generate a tax report for the year
4. Click on “Load Report” and then select TurboTax from the options
5. If you have less than 2251 transactions (TurboTax limit), click on “Download your capital gains data” to download the file for TurboTax
6. 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:

1. Download the capital gains file and login into your TurboTax account
2. Select “Federal” in the left navigation bar and “Stocks, Cryptocurrency, Mutual Funds, Bonds, Other” at the right
3. Select “YES” on the page “Did you sell any of these investments in Year?”
4. Select “Cryptocurrency” and “Continue”
5. Select “Try another way”
6. Select “Upload it from my computer” and “Continue”
7. Select “Other” under Crypto service, add CoinTracking as “Name” and “Continue”
8. 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:

1. You have to answer the crypto question on Form 1040 if you traded crypto
2. Declare all of your crypto gains and losses on Form 8949 and Schedule D of your Form 1040
3. 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
• Using crypto losses to offset gains by doing crypto tax loss harvesting
• 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:

• Importing (API & CSV) your trades from 110+ exchanges.
• DeFi and NFT support with our ETH+DEX importer.
• Importing your Binance Chain, Binance Smart Chain, and MATIC transactions.
• 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.

Moreover, CoinTracking can easily classify all your earnings from yield farming, liquidity pools, crypto staking, and much more.

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.