What Happens if I Don’t Report Crypto Transactions?

Failure to report your crypto gains and losses can result in penalties, interest, or even legal action from the IRS.

The agency has been increasingly active in tracking crypto transactions, partnering with exchanges and issuing notices to taxpayers.

Do I Need to Report Crypto Losses?

Yes! Reporting your crypto losses is just as important as reporting gains. Losses can offset your gains dollar-for-dollar, reducing your taxable income. If your losses exceed your gains, you can deduct up to $3,000 per year ($1,500 if married filing separately), with any remaining losses carried forward to future tax years.

How to Simplify Crypto Tax Reporting

Here’s how you can make the process easier:

1. Keep Detailed Records
   • Track every crypto transaction, including the date, amount, and purpose.
   • Note the cost basis, sale price, and any associated fees.
2. Use Crypto Tax Software
   • Platforms like CoinTracker or Koinly can help calculate gains and losses automatically.
3. Work with a Tax Professional
   • Complex crypto activities like mining, staking, or DeFi transactions may have additional tax implications. Consulting a professional ensures you stay compliant.

We’re Here to Help

Navigating crypto taxes can be overwhelming, but Daniel Ahart Tax Service® is here to simplify the process. Whether you need help reporting your transactions or understanding your tax liability, our experienced team is ready to guide you through every step.

📞 Call us today or visit our website to schedule a consultation.

Read also: Taxable Events from your Crypto Investing Activity

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