In today’s crypto for advisers, Bryan gives the Couches from Daim information on tax planning for crypto trades. Although we are half a year away from the tax season, there are many considerations to be traced to be taxable.
Then, SAIM AKIF from AKIF CPA breaks down the differences in tax treatment between crypto and shares/bonds in Ask an expert.
Crypto -Taxes are complicated, don’t let them derail your portfolio
As advisers focused on crypto, we are familiar with the unique tax situations this asset class presents. For example, Krypto is not subject to washing sales rules, which enables more effective harvest of tax cards. It also enables direct asset exchanges, such as converting Bitcoin (BTC) to Ether (ETH) or ETH to Solana (Sun), without first selling for cash. These are only a few features that separate crypto except for traditional investments.
It is perhaps the most important thing for investors to consider the large number of platforms they can use and how challenging it can be to track everything at the time of tax.
Tracking your crypto fees is not just one year after the end; It is a challenge all year round, especially if you are active on several centralized exchanges (CEXS) or decentralized platforms (DEXS). Each trade, swap, airdrop, pesting of reward or bridge formation can be a taxable event.
Centralized exchange trade
When you use CEXs such as Coinbase, Binance or Kraken, you can receive tax summaries from the end of the year, but these are often incomplete or inconsistent across platforms. A major challenge is to track your cost base across exchanges.
For example, if you buy the Amazon stock in a Fidelity account and transfer it to Schwab, your cost base is transferred smoothly and updates with each new trade. At the time of tax, Schwab can generate an exact 1099 showing your winnings and losses.
But in crypto, if you transfer assets from Kraken to Coinbase, your cost base is not automatically transferred with them. If you move assets across multiple platforms, manually track any transaction or you will have a bigger headache when you archive tax.
Decentralized exchange trade
Things become even more complicated when using DEXS. Apps like Coinbase Wallet (not to be confused with Coinbase Exchange) or Phantom connects you to decentralized trading platforms such as Uniswap or Jupiter. These DEXs do not issue tax forms or track your cost basis, so it is entirely up to you to log and unite any transaction.
Miss a single token swap or forget to detect the fair market value of a liquidity pool -backing and your tax report can be inaccurate. It can trigger the IRS control or lead to unanswered deductions. While some apps can calculate gains and losses from a single wallet address, they often struggle when assets are transferred between addresses, making them less useful for active users.
And here’s the kicker: If you are actively dealing with DEXS, the chances are that you won’t even make money. But even losses must be reported correctly to qualify for a deduction. If not, you risk losing depreciation or worse, facing an audit.
Unless you are a full-time crypto-driver, the time and forces required to trace any transaction, not only stressful, it can cost you real money.
What steps can I take to make sure I’m tax ready?
However, there are several ways to prepare properly for crypto fees:
- Use crypto tax software from the start. Even then you will double control that the reported activity makes sense and adjusts as needed.
- Hire a Crypto-Tax Specialist or work with a cryptophocused advisor who understands the landscape.
- Download all transaction logs and see if your CPA or advisor can help build a cost basis and determine your realized gains and losses.
As the adoption increases, tax reporting will undoubtedly develop – in the meantime, it is important to keep track of your trading activity to be ready for the tax season.
And Bryan Courchesne, CEO, Daim
Ask an expert
Question: Why do counselors look carefully crypto?
A.institutional crypto flow has risen to $ 35 billion. While crypto is more unstable than traditional assets, large cryptocurrencies like Bitcoin have historically better than other traditional asset classes since 2012.
Question: How is crypto treated differently than shares/bonds from a tax page?
A. Crypto basically differs from shares and bonds. Consultants must track each wallet separately for cost base (starting January 2025). Unlike traditional 1099s, clients often get a little to no reporting support from exchanges, especially for self -defense assets.
Question: Do you have any special insight into CPAs and tax advisers?
A. Compliance is no longer optional. From 2025 returns:
- Reporting at wallet -level is mandatory.
- IRS form 1099-da begins to emerge in 2026.
- Exchanges often do not support reporting for self -defense assets.
Professionals in smart taxpayers combine tax reporting, audit defense and defi accounting in Premium -Advisive Services.
And Saim Akif, Founder, AKIF CPA
Continue to read
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