Taxes FAQ

Coinbase FAQ (U.S. Customers Only)

Do taxes apply to virtual currency gains?

Yes. Although Coinbase cannot provide legal or tax advice, the U.S. Internal Revenue Service has released guidelines for how to report and pay taxes relating to virtual currency activity. You can read the guidelines from the official IRS.gov website here: http://www.irs.gov/pub/irs-drop/n-14-21.pdf.

We remind all our customers, that you have a responsibility to self-report and pay taxes on all taxable gains. Please consult with your accountant or tax advisor to ensure that you file and pay taxes correctly.
 

Will Coinbase send me a 1099 or similar form?

Coinbase provides Form 1099-K to certain business customers and Coinbase Pro customers that have received at least $20,000 cash for sales of virtual currency related to at least 200 transactions in a calendar year. If a U.S. customer has met these criteria in a calendar year, the aggregate amount of all the customer’s transactions for such year will be reported to you on Form 1099-K. Coinbase will provide a copy of the 1099-K to you on or before January 31 for the prior calendar year. We will provide a separate copy to the IRS.
 

Massachusetts and Vermont customers – Coinbase provides Forms 1099-K to certain business customers and Coinbase Pro customers that received at least $600 cash for sales of virtual currency in a calendar year. If such customer has met these criteria in a calendar year, the aggregate amount of all the customer’s transactions for such year will be reported on Form 1099-K. We will provide a separate copy with the Massachusetts and Vermont tax authorities but we will not provide other 1099 reporting information to the IRS, unless you qualify separately under the larger thresholds described above.


 

Does Coinbase provide other tax reporting information?

You should refer to your account transaction history for records to compute your gains and losses over a given period. As a convenience to our customers, Coinbase also has launched a new report, a Cost Basis for Taxes report (in beta), which will help with filing your taxes.
 

This report provides a summary of your virtual currency purchases and sales, showing the purchase price of each purchase and the sales proceeds of each sale taking place on our platform. Please note the Coinbase reporting tool is in beta and we expect to launch an improved version in February 2018.
 

Only purchases and sales of virtual currency are captured on this report. Transactions sending virtual currency into or out of your Coinbase wallet are not captured in this report. As such, you should keep your own records virtual currency offsite to a desktop wallet, and then back again, you would not count this as a sale of virtual currency.

You can generate the report here, by clicking on "New Report" in the upper right hand corner.


Note that if you have any deleted virtual currency wallets within your Coinbase account, they will not appear in the report generation tool. To restore them, navigate to your accounts page, select "Show Deleted" at the bottom, and then un-delete the wallet you'd like to run a report on.

If you have made any transactions on Coinbase Pro in addition to Coinbase, please refer to this article for more details about tax reporting.


Disclaimer: This report does not constitute legal or tax advice. Tax laws and regulations change frequently, and their application can vary widely based on the specific facts and circumstances involved. You are responsible for consulting with your own professional tax advisors concerning specific tax circumstances for your business. Coinbase disclaims any responsibility for the accuracy or adequacy of any positions taken by you in your tax returns.

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