Does Crypto.com Report to the IRS? (2024)

FAQs

Does Crypto.com Report to the IRS? ›

Does Crypto.com automatically report to the IRS? Yes, Crypto.com automatically reports certain transaction information to the IRS. As a centralized exchange operating in the US, Crypto.com is legally obligated to provide users' activity details through Form 1099, which is then submitted to both the user and the IRS.

Yes. In the United States, your transactions on Crypto.com and other platforms are subject to income and capital gains tax. If you've earned or disposed of crypto (ex. Sold or traded away cryptocurrency) during the year, you'll have a tax liability to report to the IRS.

Everyone who files Forms 1040, 1040-SR, 1040-NR, 1041, 1065, 1120, 1120 and 1120S must check one box answering either "Yes" or "No" to the digital asset question. The question must be answered by all taxpayers, not just by those who engaged in a transaction involving digital assets in 2023.

It's best to assume the IRS has complete transparency into your crypto activity. Crypto exchanges, including Crypto.com, are legally obligated to share customer data. If you've undergone a know-your-client process with exchanges like Binance.US or Coinbase, the IRS can track and associate your crypto activity with you.

Some cryptocurrency exchanges do not report user transactions to the IRS, including: Decentralized crypto exchanges (DEXs) like Uniswap and SushiSwap. Some peer-to-peer (P2P) platforms. Exchanges based outside the US that do not have a reporting obligation under US tax law.

Cryptocurrencies are traceable, with transactions recorded on a public ledger accessible to the IRS. The IRS uses advanced methods to track crypto transactions and enforce tax compliance. Centralized exchanges provide user data to the IRS.

If you buy Bitcoin, there's nothing to report until you sell. If you earned crypto through staking, a hard fork, an airdrop or via any method other than buying it, you'll likely need to report it, even if you haven't sold it.

There is no way to legally avoid taxes when cashing out cryptocurrency. However, strategies like tax-loss harvesting can help you reduce your tax bill legally. Converting crypto to fiat currency is subject to capital gains tax. However, simply moving cryptocurrency from one wallet to another is considered non-taxable.

Crypto-specific activity that might trigger an audit includes: Failure to accurately report crypto transactions and income. Large transactions or significant gains. Inconsistencies or discrepancies.

You must report income, gain, or loss from all taxable transactions involving virtual currency on your Federal income tax return for the taxable year of the transaction, regardless of the amount or whether you receive a payee statement or information return.

Can the IRS see my Coinbase wallet? ›

In certain situations, Coinbase does report to the IRS. However, this does not absolve individual taxpayers from their responsibility to report their own transactions. Coinbase's reports to the IRS can include forms 1099-MISC for US traders earning over $600 from crypto rewards or staking in a given tax year.

Monero transactions are confidential and untraceable.

Because every transaction is private, Monero cannot be traced. This makes it a true, fungible currency.

Yeah, Bitcoin transactions can be traced back to the original sender or wallet through the public ledger called the blockchain. Each transaction leaves a digital trail that can be followed to identify the sender's wallet address.

As required by law, Crypto.com will also provide a copy of your Form 1099-MISC to the Internal Revenue Service.

The FBI tracks and traces Bitcoins used in scams and crimes by using specialized blockchain analysis tools to monitor transactions, link addresses, and identify patterns indicative of illicit activities.

Additionally, privacy-focused cryptocurrencies offer enhanced anonymity, making tracking even more difficult. Which cryptocurrency is untraceable? Monero (XMR) is a cryptocurrency that is private, secure, and untraceable.

Even if you don't receive a 1099-NEC form, these earnings are still taxable and need to be reported on your tax return regardless if you are paid in cryptocurrency rather than another currency.

In the U.S., crypto is considered a digital asset, and the IRS treats it generally like stocks, bonds, and other capital assets. Like these assets, the money you gain from crypto is taxed at different rates, either as capital gains or as income, depending on how you got your crypto and how long you held on to it.

Yes, according to the IRS, investors in the US have to report all of their gains and losses each tax year on the appropriate crypto tax forms, including Schedule D and Form 8949 on their Form 1040.