How to Do Your Crypto.com Taxes

Transactions on Crypto.com are subject to various tax implications under US law, with cryptocurrency treated as property by the IRS. This classification means that any gains realized from the sale, trade, or use of cryptocurrencies for purchases are subject to capital gains tax.

For example, if you buy Bitcoin and sell it at a higher price, the profit you make is a capital gain and needs to be reported. On the other hand, taxpayers can potentially use losses to offset capital gains or up to $3,000 of ordinary income.

Furthermore, cryptocurrencies received as payment for services or through mining or staking are taxed as ordinary income at their market value at the time of receipt. Crypto.com users must understand these events to ensure all transactions are correctly reported to the IRS to avoid penalties.

Looking to calculate your crypto taxes? Try our free crypto tax calculator.

Here’s a quick step-by-step guide to Crypto.com taxes.

Step 1: Log into your account

Start by signing into your Crypto.com account. Navigate to your transaction history to access detailed records of all your crypto transactions, which are necessary for accurate tax reporting.

Step 2: Export transaction history

Crypto.com provides the functionality to export your transaction history into a CSV file. This comprehensive export will include crucial details such as the date, type, and value of each transaction, which you will need for your tax calculations.

Step 3: Review and categorize transactions

After exporting your transaction data, review each transaction to ensure accuracy. This includes verifying the dates and amounts and categorizing each transaction as a sale, trade, income, or other event relevant for tax purposes.

Step 4: Calculate gains and losses

Calculate your total capital gains and losses using the detailed transaction data. This calculation is vital for completing your tax forms correctly and ensuring you pay the correct taxes.

Looking to calculate your crypto profit? Try our free crypto profit calculator.

Step 5: Prepare tax forms

After compiling all the necessary data and calculating gains and losses, the next step is to fill out the appropriate IRS forms, such as Form 8949 for cryptocurrency capital gains and losses and Schedule 1 for any crypto received as income.

Crypto.com complies with IRS regulations and reports certain user activities to the IRS. Specifically, Crypto.com issues Form 1099-MISC for users who earn $600 or more in cryptocurrency through staking or similar rewards.

Despite this, users are responsible for self-reporting all other taxable events not covered by Form 1099-MISC, as Crypto.com's reports may not include every taxable transaction due to the complex nature of crypto activities.

For most Crypto.com users, the primary form required for reporting crypto transactions is Form 8949, used to report capital gains and losses. This form helps detail each transaction's specifics, such as the acquisition and sale dates, prices, and gains or losses incurred.

Additionally, if you've earned cryptocurrency as income, taxpayers should report with Schedule 1 (Form 1040), which is used to report additional income sources apart from wages.

Effective tax filing for Crypto.com transactions requires thorough documentation. This includes your exported transaction history from Crypto.com, Form 8949 for reporting each transaction, and any additional supporting documents like bank statements or receipts that can help verify the transactions if the IRS undertakes a crypto tax audit.

As a Crypto.com partner, TokenTax helps Crypto.com users by simplifying crypto tax reporting. TokenTax offers tools that directly import your transaction data through CSV files or API connections.

This integration allows for automated calculations of gains and losses, ensuring accuracy and compliance with IRS requirements. With TokenTax, users can confidently manage their crypto taxes, minimizing errors and maximizing potential deductions. When in doubt, our crypto tax professionals are available to assist.

Here are answers to frequently asked questions about Crypto.com taxes, Crypto.com tax forms, and Crypto.com tax documents.

How much crypto taxes do I have to pay?

The taxes you owe from Crypto.com transactions depend on your capital gains and any crypto income received throughout the tax year. The tax rates applicable will vary based on your overall income level and the specific tax bracket you fall into. Calculating each transaction's gains or losses is essential to determine your total tax liability. Learn more about the tax rates for cryptocurrency in the US.

Is there a way to lower my crypto taxes?

Yes, several strategies can help reduce your crypto tax liability. Holding your cryptocurrency for over a year might qualify you for lower long-term capital gains rates. Strategically realizing losses can offset gains and reduce overall taxable income. Proper timing of these transactions is crucial and can significantly impact your tax bill. Read further about how to reduce your crypto taxes.

What Crypto.com tax forms do I need to use?

To report your Crypto.com transactions to the IRS, you will primarily need Form 8949 to list all your capital gains and losses. Additionally, you should use Schedule D of Form 1040 to summarize your overall capital gains and losses reported on Form 8949. If you have any cryptocurrency treated as income, it should be reported on Schedule 1 (Form 1040), which covers additional income sources.

How do I obtain Crypto.com tax documents?

Crypto.com allows you to export your transaction history, which includes all necessary details for tax reporting, such as the date, amount, and type of each transaction. This exported CSV file can be imported into tax software like TokenTax, which can help generate the necessary tax forms based on your transaction data.