After importing all your data into ACCOINTING.com we will automatically generate a Form 8949 for your crypto trading history to include in your tax return.
Download the condensed format together with the exception file here
The Form 8949 contains a summary of all gains and losses you created for the tax year. This document is the basis of your tax filing and you have to file it together with your Schedule D. The following abstract explains the condensed version of the Form 8949, the calculation and the exception file.
The gains are calculated by subtracting the proceeds from the cost basis. It contains two parts as shown in the picture below: The first part lists a summary of all your short-term trades (Figure 1) and gains and the second part shows all the long term trades and gains (Figure 2).
In addition to that we provide an exception file that you can use to prove every single transaction in case the governments needs more information. (The Form 8949 is also used for stock and other assets, so you may have multiple Form 8949 files).
*Don't forget to add your name and SSN to the 8949 pages (we don't ask this from you to protect your privacy).
The Form 8949 is used to report the sale or exchange of a capital asset. ACCOINTING.com completes all pages of your Form 8949. To proceed, please download the Form 8949 here.
Once your Form 8949 is ready you can start to complete line 1b, 2, 3, 8b, 9, or 10 of the Schedule D. You use the Schedule D to figure out the overall gain or loss from transactions reported on Form 8949 and to report transactions that can’t be included in the Form 8949. You can also carry over a loss from one year to the next. The IRS 2014 virtual currency publication and the IRS FAQ contains more information if needed.
Include your totals from your Form 8949 onto your Form Schedule D (3 and 10).
In certain events you might have earned cryptocurrencies as ordinary income instead of capital gains. Examples are income from staking, mining, or interest earned.
In the first line you can answer with “yes”. Crypto that you have earned personally (not as self-employed) has to be reported in Schedule 1 in Line 8 “Other income.”
If you run a self-employed crypto mining operation you have to report your income in Schedule C.
Now that you have entered all of your cryptocurrency gains, losses, and income in your reporting files, you can complete your returns.
If you want to use a tax tool to complete your tax return, you can read about different integrations here or send the files to your CPA. If you need help finding a new CPA, you’ll find a list here.