Does Binance Report to the IRS?
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Binance US sends Forms 1099-MISC to traders who have earned more than $600 from staking, rewards, or similar programs on the platform.
Does Binance report to the IRS? Because Binance no longer serves US users, it does not report to the IRS.
How are my Binance transactions taxed?
How your Binance transactions are taxed will depend on where you pay taxes, as different countries and territories have different rules around crypto taxes. Learn more about international crypto tax regulations for further details specific to your region.
Often the taxation of your Binance transactions will be determined by whether you trade cryptocurrencies as a casual investor or are a professional trader. If you invest casually, gains and losses from your transactions may be treated as capital gain or loss. This is the case for US taxpayers using Binance US.
For professional traders, profits gained from trades may be taxed at ordinary income rates. Again this depends on your region. US taxpayers trading or earning other crypto income professionally can anticipate paying regular income tax rates on their crypto profits.
For US taxpayers: How to Report Crypto On Your Taxes
Does Binance report crypto transactions to the IRS?
Binance is a global company and one of the most popular crypto exchanges in the world. It does not presently serve US-based traders, so does not report to the IRS. Instead, it operates a separate site for American traders: Binance US.
As noted, Binance US does report to the IRS, and US taxpayers must report their crypto activity to the IRS.
What information does Binance US send to the IRS?
Binance US sends a copy of this Binance US 1099 to the IRS as well. The 1099-MISC form includes the user's name, address, tax identification number, and the amount of income earned.
The IRS requires US taxpayers to report gains and losses earned from crypto on their annual tax return, using Form Sch D (Form 1040). This applies to all losses and gains.
Binance US provides three types of reports through their platform: Transaction History, 1099-MISC (if applicable), and a Transaction Tax Report. We recommend using your Transaction History to generate a Gain/Loss Report.
Upon reviewing your transactions, simply audit and determine whether you incurred gains or losses. Better yet, use TokenTax to automatically import your Binance US transaction data and generate your Gain/Loss Report for you.
Raw transaction report
The Binance US Transaction History report includes all your transaction data from the platform, which can be used to determine profits and losses. Binance US provides instructions as to how to generate this and other reports. TokenTax integrates with Binance US to make the tax reporting process easy for our users.
What do I need to do if I received a 1099-MISC from Binance US?
If you receive Binance US 1099, you’ll want to review it for accuracy. When filing your crypto taxes, the 1099-MISC income should be reported on Schedule 1 (Form 1040) and taxed as regular income.
US taxpayers must report income shown on any 1099-MISC. Keep your copy of the 1099 for your records.
Does Binance US send a 1099-B?
The 1099-B form covers proceeds from broker and barter exchange transactions. In other words, the 1099-B is used to report on the sale of stocks, bonds, or other securities through a broker.
Presently Binance US does not send a 1099-B to the IRS, but this is subject to change in the future per the American Infrastructure Bill.
Report your Binance US taxes with TokenTax
The simplest way to complete your Binance US taxes is through our platform at TokenTax, which integrates automatically with Binance US and other popular exchanges and wallets to simplify tax season and ensure accuracy. Through our VIP plan, we’ll even do your crypto taxes for you.
To get started with TokenTax, simply sign up or log in. In order to import data, you’ll need to purchase one of our plans, which start at just $65/year. You can then use the “Import” option and choose Binance US.
You’ll find instructions about how to connect the Binance US exchange API to TokenTax. Upon completion, your transaction data will be imported to TokenTax, and you can proceed with your tax filing.
If you choose to manually report your Binance US taxes, simply generate your Transaction History on the platform and calculate your gains or losses for the tax year.
Schedule a FREE crypto tax consultation
Binance IRS reporting FAQs
Here are answers to frequently asked questions about Binance, does Binance report to the IRS, and does Binance US report to the IRS?
Which crypto exchanges do not report to the IRS?
As a rule, centralized exchanges operating in the United States report to the IRS and/or require KYC, which identifies a user. For example, Coinbase reports to the IRS in a similar fashion to Binance US.
Will the IRS know if I don’t report crypto?
The IRS has access to a number of resources that can help them identify whether or not someone has properly reported their crypto holdings and gains. These include information from exchanges, third-party wallet services, payment processors, and other sources.
Furthermore, the IRS has also implemented new tools to detect when taxpayers are underreporting their income from virtual currencies.
Can the IRS see my crypto?
The short answer is “yes.” The IRS achieves transparency into crypto transactions by collecting Know Your Client (KYC) data from centralized exchanges like Binance US.
Even if you principally trade crypto via DeFi, it’s fair to assume the IRS can track your interactions through any centralized exchange you use as an on- or off-ramp.
Tax evasion is a crime, so it’s essential US taxpayers are thorough and accurate in reporting crypto activity on their taxes.
Do I need an FBAR for Binance?
For US taxpayers, the answer is likely “no.” An FBAR is a Report of Foreign Bank and Financial Accounts. A US taxpayer with financial interest in or signature authority over foreign financial accounts must file an FBAR if the aggregate value of the foreign financial accounts exceeds $10,000 at any point during a given calendar year.
Before 2019, when Binance closed to US users, many Americans traded on Binance. If you traded on Binance and you hold crypto above the FBAR threshold for foreign holdings, you will need to include the original Binance in your FBAR filing. Binance US users do not need an FBAR.
Do you have to report crypto under $600?
US taxpayers are expected to report all crypto transactions to the IRS, whatever the amount. Failure to report these can result in penalties and interest.
For example, if you received income under $600 through Binance US from staking, rewards, or similar programs and did not receive a Binance US 1099, you are still expected to report on the income received.
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