Coinbase and Turbotax make it as easy as possible to import your trades and prepare your taxes. You can download a Coinbase .CSV export and then import it directly into your Turbotax account. Turbotax offers live CPAs for assistance. If you are new to crypto, been trading since Coinbase launched in 2012, or if you are being compensated with Bitcoin, Turbotax can sort out your Coinbase taxes.
CoinTracker Integrates Coinbase and Turbotax
Coinbase has integrated CoinTracker, connected via an application programming interface (API) and is much more seamless. The value of using CoinTracker as a middleman is because most cryptocurrency users make thousands of transactions across all their wallets and exchanges. CoinTracker seamlessly and automatically integrates 20 of the top exchanges. The integration automatically computes capital gains and factors it into the rest of your tax return.
CoinBase and Turbotax Can Save You From the IRS
While the IRS only made its initial guidance in 2014, you are on the hook retroactively from the first day you mined, bought, sold, traded, or held Bitcoin and other altcoins and cryptocurrency. In the recent past, you needed to manually enter each transaction into Turbotax. Now, you can upload the taxable transactions from Coinbase via downloaded text export file to Turbotax. These uploads include the cost basis for your transactions.
Measure Coinbase Twice, Cut Turbotax Once
Even with automation, it’s worthwhile to review every transaction manually. If you need help ascertaining the taxability of each asset in your Coinbase Wallet, you can get lots of guidance from Turbotax Premier. According to the website, “TurboTax Premier automatically imports investment income from financial institutions and gives you step-by-step guidance online on reporting income.”
For Coinbase Choose Turbotax Premier
If you are a hardcore Coinbase Pro user, it’s more than worthwhile to upgrade to Turbotax Premier. The Premier version offers one-way video with CPAs and Agents who can answer tax questions right from home. These agents can tell you you’ll need to report income if you’ve:
- Converted your cryptocurrency to fiat government currency like Dollars and Euros
- Sold your crypto
- Spent it for good or services
- Received free coins through a hard fork or an airdrop
In addition to Premier, Intuit Consumer Tax Group also offers TurboTax Self-Employed, TurboTax Live Premier and TurboTax Live Self-Employed as options for Coinbase cryptocurrency import and advisement.
You’ve Got to Know When to HODL
The best news is that if you HODL (slang for holding crypto rather than selling it), you don’t owe the IRS a thing (though you should consult with your tax lawyer). Some other untaxable transactions include gifts under $15,000 and 401k and IRA retirement investments.
Make it easy for yourself and invest in Turbotax Premier and go with CoinTracker. Instead of needing to chase around exports and imports from at least Coinbase, go with the service that makes it easy and automated enough to make everything as smooth as possible. Doing taxes is always hard enough on its own without making it any harder. Give Turbotax Premier a try this upcoming tax season.