Crypto traders often wonder which crypto tax form to use when it’s time to file. The IRS continues scrutinizing digital assets, so you’ll want to stay on top of the latest requirements. Below, we walk through the core documents, from reporting domestic income to disclosing foreign holdings, so you can avoid missteps and keep your filing process hassle-free.

What crypto tax form do I need to fill out as an investor?

Retail traders typically need Form 8949 (to show capital gains and losses) and Schedule D (to summarize them). Suppose you also earned ordinary income from activities like staking or freelancing. In that case, you may need additional lines or schedules, such as Schedule 1 or Schedule C. If you received any official crypto form like a 1099 from an exchange, you’ll reconcile those details on your return.

Double-check your basis and acquisition dates to see whether you flipped tokens short-term or held them for years. Short-term gains (assets held one year or less) get taxed at ordinary rates, while long-term gains generally get a more favorable rate.

Answer the crypto tax question on Form 1040

Early in your Form 1040, you’ll see a direct question about whether you engaged in virtual currency transactions. This aims to ensure you disclose relevant crypto activities, even if you didn’t receive a dedicated crypto tax form. Any sales, swaps, or other dispositions of crypto should be noted.

• Yes: If you traded, staked, earned, or otherwise transacted digital assets in a taxable way.

• No: If you merely held crypto in your wallet without buying, selling, or exchanging it during the year.

Records to keep to fill out your crypto tax form correctly

Organized documentation is key. Keep the following:

1. Transaction history: Dates, amounts, and asset types for buys, sells, and trades.

2. Cost basis details: Initial price plus any fees or commissions.

3. Income records: If you earned crypto from staking, mining, or other means, note amounts and fair market values at time of receipt.

4. Foreign accounts or holdings: For any non-US exchanges or wallets that exceed certain thresholds, you might need FBAR or Form 8938.

Use our free crypto tax calculator.

Why reporting crypto on your tax return is crucial

Not reporting gains or income can lead to letters from the IRS, potential penalties, and undue stress. The agency has become more proactive in matching exchange data with taxpayer records. Filing the right crypto form accurately is the best way to prevent issues later.

Do I need to report all my crypto income?

If you made any crypto-based income, then yes. That includes wages paid in crypto, referral bonuses, airdrops, or staking rewards. Income triggers tax obligations whether you receive dollars or digital tokens. When you gain control of the assets, report the fair market value, then treat it as ordinary income.

1099 form for crypto

Some exchanges issue a 1099 form (like 1099 MISC or 1099 B) for traders who meet certain thresholds. This document shows the IRS you’ve made trades or earned income through that platform.

I didn’t receive a 1099 form: What should I do?

Even if you aren’t issued an official statement, you’re still on the hook to self-report. Gather transaction data from your account history (many exchanges let you export this) and use that information to complete Form 8949 or any relevant schedules.

My 1099 form is inaccurate

Discrepancies happen if your exchange doesn’t track transfers correctly or lacks cost basis data from external wallets. If your 1099 is off, rely on your own meticulously kept records. You can correct the numbers on your return or, if needed, reach out to the exchange for amendments.

Foreign crypto holdings tax forms

International exchanges or wallets can trigger additional filings. If your overseas assets exceeded certain amounts at any point during the year, you may need:

1. FBAR (FinCEN Form 114): For aggregate foreign balances over $10,000.

2. Form 8938 (FATCA): If your total foreign assets surpass thresholds based on your filing status.

Both forms aim to help authorities track offshore accounts and confirm accurate reporting.

Calculate your crypto gains with our free crypto profit calculator.