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The IRS has recently sent letters to taxpayers titled “Reporting Virtual Currency Transactions” stating “[w]e have information that you have or had one or more accounts containing virtual currency but may not know the requirements for reporting transactions involving virtual currency.” The IRS further states “[i]f you do not accurately report your virtual currency transactions, you may be subject…

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September 25, 2020

According to the United States Court of Appeals for the Fifth Circuit, law enforcement officials do not need a search warrant to get account records from a cryptocurrency exchange or from the public blockchain. On June 20, 2020 the court ruled that cryptocurrency exchange account holders do not have a constitutionally cognizable privacy interest in their transaction history and therefore do not…

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July 30, 2020

The first half of 2020 has felt like several lifetimes for many people. While the COVID-19 pandemic has caused major harm to the global health and economy, one positive outcome has been an increase in charitable giving. For cryptocurrency investors, giving to your favorite charity or cause is easier than ever through organizations like The Giving Block. The Giving Block enables cryptocurrency…

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July 07, 2020

U.S. brokers of capital assets have strict data collection and information reporting requirements to ensure that taxpayers properly comply with their tax reporting obligations. Individuals or entities that are required to file information returns with the IRS must obtain correct taxpayer identification numbers (TIN’s) in order to properly file such returns. Similarly, international cryptocurrency…

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July 06, 2020

On January 1, 2016, the European Union adopted Common Reporting Standards (“CRS”) to provide centralized exchange information reporting with tax authorities to help avoid tax evasion. The idea stems from the U.S. Foreign Account Tax Compliance Act (“FATCA”), which requires non-U.S. foreign financial institutions to search their records and report on assets and identities of such persons to the U.S…

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June 29, 2020

This past year saw tens of thousands of IRS audits into taxpayers’ cryptocurrency activity. Most of these IRS investigations came about due to the IRS receiving information reporting from various cryptocurrency exchanges using Form 1099-K. Form 1099-K reports a user’s total aggregate volume of payment transactions. It is important to note that Form 1099-K does not take into account cost basis, and…

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June 05, 2020

Bitcoin faces a technical event today known as the “halving.” The halving results in the amount of Bitcoin awarded to miners to be cut in half. Prior to the halvening the reward for successfully mining a block was 12.5 Bitcoins. That amount will now be reduced to 6.25 Bitcoins per successful block mined. Roughly every four years Bitcoin experiences a halving event. Unlike fiat currencies that are…

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May 12, 2020

TaxBit is happy to announce the recent hire of CPA and cryptocurrency tax subject matter expert, Seth Wilks. Wilks is regarded as a leading expert on cryptocurrency tax matters. Wilks has been heavily involved in educating and informing policy makers and regulators relating to virtual assets. In March 2020, Wilks was recognized as a cryptocurrency tax specialist and served as a panelist at the IRS…

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May 06, 2020

TaxBit is proud to announce that it has joined forces with the Chamber of Digital Commerce as a President’s Circle Member and representative on the Tax Task Force Leadership Committee. TaxBit looks forward to being a member of the world’s leading blockchain trade association. “The Chamber of Digital Commerce is at the forefront of establishing standards and best practices through a structured…

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April 29, 2020

Across nearly every industry data breaches have increased at an alarming rate. Most breaches are fairly benign and may only involve usernames and email addresses, but many might include sensitive information such as social security numbers or credit card information. Security underlies every decision we make at TaxBit. We have found that cryptocurrency traders care more about security than the…

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April 14, 2020

The deadline to file and pay taxes has been extended for the first time in our nation’s history to July 15, 2020. Over the last couple of weeks our collective attention has shifted to COVID-19 (“Coronavirus”). Congress scurried to pass much needed financial relief that will, among other things, give every adult $1,200 and child $600. This, however, may not be the biggest check that Americans are…

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April 06, 2020

Congress recently passed the Coronavirus Aid, Relief and Economic Security Act (CARES) that designates $2 trillion stimulus funding to provide financial relief to individuals, families and businesses. The 2020 coronavirus stimulus package will deliver relief through a range of measures, including an advanced tax rebate to taxpayers. Who Will Receive a Stimulus Check? Stimulus checks will be based…

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April 01, 2020

In 2019, more Canadians searched for “Bitcoin” on Google than “Kim Kardashian.” Bitcoin awareness jumped by almost a third in the same timeframe, with more than 8 in 10 Canadians claiming at least some familiarity with bitcoin. This increase in curiosity has led to an increase in curious purchasers. In fact, almost four in ten Bitcoin users purchased Bitcoin for the first time to “give it a try…

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March 24, 2020

We are a team, we are a community. And now, we can help change the way the world views cryptocurrency. We are facing the worst pandemic of the modern era. Public health experts sounded the alarm about COVID-19 for weeks, if not months, now, we must take action. We have an opportunity to support the organizations serving at the front lines to fight COVID-19. Team Rubicon: Veterans serving in…

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March 23, 2020

Due to the disruptions of COVID-19 ("Coronavirus"), the IRS announced that they are giving taxpayers an additional 90 days to pay and file their tax bill. This extends the deadline for 2019 taxes owed and filings to July 15, 2020. It is important to note that this 90 day extension now applies to tax filings and tax payments. However, most taxpayers who file will receive a tax refund…

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March 18, 2020

Uphold and TaxBit Introduce 1099-B Tax Reporting For Users -- Seamless Industry-Leading Tax Visibility and Reporting New York, NY, March 03, 2020 (GLOBE NEWSWIRE) -- (via Blockchain Wire ) Uphold, the digital money platform that powers ‘anything to anything’ trades between cryptos, national currencies, metals, and more, is proud to announce that it leads the charge with compliant tax reporting for…

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March 03, 2020

TaxBit has partnered with leading tax preparation company, 1-800Accountant, to provide TaxBit Accountant tools to accountants and their clients for ease in tracking cryptocurrency transactions for filings. 1-800Accountant CEO, Mike Savage, says, "1-800Accountant is excited to offer TaxBit Accountant to our clients with cryptocurrency. With the IRS's regulations around cryptocurrency, accountants…

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March 02, 2020

TaxBit is excited to announce that it has partnered with BlockFi to help its users automate their cryptocurrency taxes. BlockFi customers can securely sync their account to TaxBit and generate their required tax forms. An overview of the partnership on BlockFi's website can be viewed here. A live stream discussing the partnership featuring BlockFi's CEO Zac Prince and TaxBit's CEO Austin Woodward…

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February 24, 2020

It’s tax season and many taxpayers will receive tax forms from cryptocurrency exchanges. Due to some confusion in the industry, some taxpayers may receive a form 1099-K, others will receive a form 1099-B, and some may receive nothing at all. Whatever situation you fall under, TaxBit is skilled in helping. Form 1099-K A couple of cryptocurrency exchanges have issued 1099-K’s, which is an…

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February 14, 2020

TaxBit is excited to announce that it has partnered with Gemini to help its users automate their cryptocurrency taxes. Gemini customers can securely sync their Gemini account to TaxBit and generate their required tax forms. An overview of the partnership is also available on Gemini’s website. Users can easily connect their exchanges, see their real-time tax liability as they trade, and generate…

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February 11, 2020

TaxBit’s users have frequently asked how they can refer their friends to TaxBit. By popular demand, TaxBit is excited to announce the release of its customer referral program. Users will receive up to $100 for referred users who sign up for TaxBit. To refer a friend to TaxBit you can navigate to the settings page of your TaxBit account. You will have a unique referral link within your account that…

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January 21, 2020

Thousands of cryptocurrency traders have been receiving CP2000 letters from the IRS over the past few months. CP2000 notices have been in the tax compliance world for a while and are not specific to cryptocurrency. CP2000 notices are often generated when there is a matching issue between what is reported to the IRS by an exchange/broker and a taxpayer. In the cryptocurrency realm, TaxBit has…

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January 13, 2020

TaxBit is happy to announce the recent hire of former Coinbase Compliance Director Jeff Cartwright. Cartwright was an early employee at Coinbase and helped lead general compliance, internal audits, and regulatory risks. After leading compliance matters at Coinbase, Cartwright worked at Facebook as a Policy and Compliance Manager on its cryptocurrency project, Calibra. Cartwright is an attorney and…

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January 08, 2020

TaxBit, which offers cryptocurrency tax automation software for crypto users, exchanges, and merchants, announced today a $5 million seed round, with a stellar group of investors composed of Fintech leaders TTV Capital and Valar Ventures, crypto moguls Dragonfly Capital Partners, Collaborative Fund and Winklevoss Capital, and generalist investors Global Founders Capital, Table Management, Album…

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January 06, 2020

On October 9th, 2019, the IRS released long awaited guidance on the taxation of cryptocurrency through Rev. Ruling 2019-24 and an associated FAQ. Specific to this article, the IRS issued additional guidance on proper cost basis assignment methods. This article will discuss: Why cost basis assignment methods matter; and Acceptable and the most optimal IRS cost basis assignment methods for…

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December 13, 2019

On October 9th 2019, the IRS released long awaited guidance on the taxation of cryptocurrency through Rev. Ruling 2019-24 and an associated FAQ, including their guidance on treatment of airdrops. The IRS takes the controversial position that the airdrop equates for taxation purposes to a dividend. As a corollary, an involuntary (and perhaps unknowing) recipient of an airdropped token would have…

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December 09, 2019

The IRS just released a new Schedule 1 for the 2019 tax season asking every taxpayer about their cryptocurrency activity. Specifically, the form requires taxpayers to respond to the following question: “At any time during 2019, did you receive, sell, send, exchange or otherwise acquire any financial interest in any virtual currency.” Signalling increased enforcement, the IRS included this…

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December 06, 2019

In 2014, the IRS declared that cryptocurrency, such as Bitcoin, is treated as property for tax purposes. In 2019, the IRS released further guidance through Revenue Ruling 2019-24, which brought cryptocurrency in even further alignment with equities and other capital assets for tax purposes. Taxpayers are required to report their capital gains and losses on the same form (IRS Form 8949) as stocks…

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November 18, 2019

Cryptocurrency exchange Huobi.com announced that it is shutting down operations to U.S. users. United States Huobi users have until November 13, 2019 to move their assets off of Huobi.com Users should connect their API’s to their TaxBit account or export their transaction history so that they have records of taxable transactions, per IRS requirements. Exchanges shutting down can make it very…

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November 07, 2019

Large cryptocurrency exchange Poloniex announced that it is shutting down operations to U.S. users. TaxBit is here to shed some insight and share how to prepare from a tax standpoint. U.S. Poloniex users have until December 15, 2019 to connect their API’s to their TaxBit account or to export their transaction history so that they have records of their taxable transactions. On February 26, 201…

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October 22, 2019

In the crypto tax space there is frequent mention relating to taxpayers’ responsibilities to calculate and report capital gains and losses on an IRS 8949 cryptocurrency tax form. What often gets overlooked is the tax implications and potential deductions for mining cryptocurrency such as bitcoin. Mining cryptocurrency has a unique problem of creating multiple tax implications that must be reported…

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October 21, 2019

After months of anticipation, the IRS has finally released its new cryptocurrency tax guidance through Rev. Rul. 2019-24 and an FAQ. Specifically, this new revenue ruling clarifies: 1) proper tax calculation methods; 2) the tax treatment of hard and soft forks; 3) proper sources for pricing data; 4) cost basis assignment on gifted crypto; and 5) taxpayers’ responsibilities. 1) Proper Tax…

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October 10, 2019

The IRS says I need to report my cryptocurrency taxes…, but I had net taxable losses? TaxBit has frequently heard this sentiment from its users. Although losing money on your crypto trades is a major bummer, TaxBit can help you receive some relief in the form of an increased tax refund. With wild price swings and volatile coins, most crypto traders lived through the unfortunate reality of losing…

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October 09, 2019

In 2014 the IRS clarified that cryptocurrency is taxed as property. This means that every cryptocurrency trade or sale is a taxable event. Although taxpayers are required to report taxes on virtual cryptocurrencies such as Bitcoin, the process of doing so before TaxBit was I guess you could say... taxing. Over the last couple of months the IRS has sent thousands of letters to taxpayers who traded…

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September 26, 2019