<div fs-richtext-component="info-box" class="info-box"><div class="flex-info-card"><img src="https://assets-global.website-files.com/65098a145ece52db42b9c274/650c6f4cef4c34160eab4440_Info.svg" loading="eager" width="64" height="64" alt="" class="icon-info-box"><div fs-richtext-component="info-box-text" class="info-box-content"><p class="color-neutral-800">Starting January 1, 2024, the Infrastructure Investment and Jobs Act requires reporting 10,000$+ crypto transactions to the IRS. Yet, the Treasury and IRS deferred digital asset reporting until new regulations are set, promising future guidance and public input on these rules. We keep you informed! </p></div></div></div>
TurboTax, by Intuit, is the most popular tax preparation tool for American taxpayers to file their individual income tax return. Regardless of whether you choose their online or desktop tool, you can easily file your crypto taxes using your Blockpit tax report and export files for each tool. In this article, we guide you through the process of reporting your crypto taxes with TurboTax Online.
For comprehensive insights into additional crypto tax topics, be sure to consult our guide.
Getting Started
If this is the first time you are using TurboTax Online, you will need to spend some time entering your personal information. As you move onto entering your crypto income, navigate to the “Investments and Savings” section, and select “Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)”. The first time you visit this section, you will be asked some questions about your crypto assets, be sure to answer these questions based on your individual situation.
Gains Summarized
The easiest way to report your cryptocurrency gains and losses is to summarize your gains into short and long term. This will save you a lot of time, but you will need to send an attachment with detailed information.
- Navigate to "Investments and Savings" > "Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B)".
- Confirm you had investment income in 2023 with "Yes".
- Proceed to "Enter a different way" when asked about importing tax info.
- For electronic filing, select "Stocks, Bonds, Mutual Funds", avoiding Form 8453 mailing.
- Use "Blockpit" for the brokerage name; leave account number and EIN blank.
- Answer "No" to employee stock and other investments questions; "Yes" to purchased investments as per Blockpit.
- Choose "Sales section totals" and continue.
- Select the appropriate form for short-term or long-term gains not reported on 1099-B. Enter proceeds and cost basis as detailed on your Blockpit tax report.
- To add more sales, use "Add more sales", separating short-term and long-term gains.
- Upload your 1099-B pdf attachment directly—no need to mail it separately.
- The final summary will display your total taxable gains or losses from investments.
For additional information on filing your attachment to form 8949, check out our article.
Reporting Your Crypto Income
We now have to enter any other taxable crypto income such as mining, staking, airdrops or hard forks. Keep in mind that if your income is from a trade or business, such as a Bitcoin mining operation, you will need to report as such. For everyone else, how you report this income will depend on whether you:
Received a 1099-MISC
- Go to "Other Common Income" > "Form 1099-MISC" and click "Start".
- Confirm receipt of 1099-MISC with "Yes". Report self-employment income under "Self-Employment" if applicable.
- Enter payer's name, federal ID, and amounts in boxes 1-18, often only box 3 for crypto.
- For 1099-MISC reason, input "staking" or "crypto rewards", then continue.
- If asked about Form 1099-MISC specifics and work similarity to your main job, choose "No, it didn’t involve work like my main job".
- Indicate how often you've received this income type, selecting "I got it in 2023".
- Answer "No, it didn’t involve an intent to earn money" when asked if crypto rewards involved an intent to earn, suggesting non-business-related income.
- If more 1099-MISC forms are to be reported, select "Yes" to repeat the process; otherwise, choose "No" to proceed.
Did not receive a 1099-MISC
1. Go to "Less Common Income" > "Miscellaneous Income, 1099-A, 1099-C" and choose "Other reportable income", then click "Yes".
2. Describe the income and amount, then click "Continue". Report total taxable crypto income as "Various Crypto Income" if you received no 1099-MISC forms, or follow 1099-MISC guidance to avoid double reporting if some income was reported this way.
Capital Loss Carryovers
If you filed with TurboTax Online in the prior year, any capital loss carryovers should be automatically rolled over into this year. However, it is a good idea to verify that these amounts are correct as they impact your current year tax return. If this is your first time using TurboTax Online, you will need to enter this information regardless.
- In the income section, navigate to the “Investments and Savings” section, expand the drop-down and select “Capital Loss Carryover”.
- Click “Edit” on the top right and enter your 2022 information from your prior year Form 1040. You will need to enter:
Form 1040 line 15 – Taxable income
Schedule D line 7 – Net short-term capital gain or (loss)
Schedule D line 15 – Net long-term capital gain or (loss)
Schedule D line 21 – Allowable loss
Alternative Minimum Tax (AMT) differences for carryovers
Form 6251 line 4 – Alternative minimum taxable income - Click on “Continue” and if you have already entered your capital gains or losses for 2023, TurboTax will summarize how your carryover can be used this year, and what you can carry forward to 2024.
For additional information on filing form 1099, check out our article.
Using Crypto Tax Software to Simplify Compliance
Crypto tax software significantly simplifies optimizing cryptocurrency taxes. Navigating the complexities of trades, staking, and airdrops becomes straightforward with the right tools. Manual management is cumbersome and error-prone, risking penalties for non-compliance.
Blockpit's software streamlines this process. It offers seamless integration through API, Public Keys, or CSV, compiling all cryptocurrency transactions efficiently. It automates tax calculations according to the latest regulations, ensuring compliance. Moreover, Blockpit provides expert support to ease the tax filing process.
By using Blockpit, you can focus on maximizing investments instead of tax reporting complexities. It ensures compliance is straightforward, offering a stress-free approach to managing crypto taxes.
Optimize & File Your Crypto Taxes With Blockpit
Blockpit creates the most comprehensive crypto tax reports in PDF format. The report provides information about all your balances and transactions and can be used as proof of origin with banks or tax advisors. It contains all relevant transactions of your account in the selected tax year and shows details such as timestamp, amount, asset, costs and fees of the individual transactions.
Using Blockpit couldn’t be easier:
1. Import your transactions
Blockpit offers direct integrations for crypto exchanges, wallets and DeFi protocols. Automatically import your transactions via API integration, wallet address synchronization, or by manually uploading an Excel file.
Discover all crypto integrations
2. Validate & Optimize
Blockpit offers smart insights and suggestions to optimize your tax report, fix issues, add missing values and to validate your transactions.
3. Generate your tax report
Generate your compliant tax report with the click of a button. Our tax engine calculates your tax report on the basis of the US tax framework.
