Binance US Tax Reporting
TokenTax imports Binance US data for easy cryptocurrency trade tracking and tax filing.
Binance.us historical overview
Binance, including its new U.S. based platform Binance.us, is one of the largest and most popular cryptocurrency exchange companies. It was founded in 2017 by current CEO Changpeng Zhao who was previously the founder of high frequency trading platform Fusion Systems. The combined Binance global market capitalization as of 2018 was USD 1.3 billion.
Binance.us allows for simple onboarding with the option to purchase crypto via domestic or international wire transfer. The exchange allows you to spot trade over a hundred trade pairs and supports over-the-counter (OTC) trading for large transfers. Binance.us exchange also supports staking, mining pool rewards.
Binance is known for having different trading platforms for different levels of crypto traders. The Binance Basic trading platform is an easy-to-use interface for buying and selling crypto and fiat currencies.
The exchange also offers an Advanced trading platform with a host of trade signals and tools for all offerings. Additionally, the exchange is very supportive of crypto education initiatives, well-known for its Binance Academy and Glossary of key cryptocurrency terms.
The reorganization of Binance and Binance.us: tax reporting implications
While Binance.com is no longer allowed to operate in the United States, American residents can now actively trade on Binance.us, the exchange’s United States entity.
If you traded on Binance.com before it ceased operations in the United States, you still need to include these transactions in order to accurately determine your cost basis for tax purposes. If you traded on both Binance.com and Binance.us, you need to include both sets of transactions for tax reporting purposes.
There are capital gains and losses taxes on your Binance trading activity
If you trade on Binance.us, it is highly recommended that you consider using crypto tax software because it will save you time trying to compile your transactions and money on your taxes.
For example, our proprietary minimization algorithm uses specific identification accounting to minimize your capital gains tax liability. Similarly, our tax software allows you to selectively sell off tax lots to harvest your losses before the end of the tax season.
You may need to file an FBAR for Binance.com — but not Binance.us
Since Binance.us is based in the United States, your cryptocurrency holdings on the exchange are not subject to Foreign Bank Account Report (FBAR) disclosure. However, any holdings you may still have on Binance.com are subject to FBAR reporting requirements.
Uploading a Binance US CSV with TokenTax
Go to your Binance US trade history by hovering over the user icon at the top right and clicking Trade History (https://www.binance.us/en/usercenter/history/user-trade).
Click on Export Complete Trade History at the top right corner.
You can only export 3 months at a time, so if you traded at Binance all year, you will need to create 4 reports (Jan – Mar, Apr – Jun, July – Sept, Oct – Dec) — remember to include all years you have traded on Binance.
Click Export to download the XLSX file.
Upload your XLSX file to TokenTax.
Withdrawals and deposits:
Go to your Binance US deposit and withdrawal history (https://www.binance.us/en/usercenter/wallet/money-log).
Select the Crypto tab, then click Export Deposit History. Then, select Withdraw under the Type dropdown and click Export Withdrawal History.
Importing a Binance US API into TokenTax
Hover over your user icon at the top right and click API Management (https://www.binance.us/en/usercenter/settings/api-management).
Create a new API key by entering a label and clicking the Create New Key button.
The link to create the API key will be emailed to you. Click on the link to view your API key and secret, and then click Edit and uncheck Enable Trading and check Unrestricted for the IP address restrict.
Copy your API key and secret to TokenTax.