It’s officially that time of the season again – Crypto Tax Time!

This guide is solely to answer any questions that may arise while you go through your crypto taxes. You are encouraged to consult a tax professional if you need personalized advice.

If you have participated in any transactions (i.e selling or trading cryptocurrency) that meet the IRS threshold, Bittrex will provide you with a 1099 form. Failing to report your earnings could result in several penalties, including criminal prosecution and large fines.

Do I have to pay crypto taxes?

If you did any of the following, you are required to report your activity:

  • Received coins through an airdrop or a fork
  • Traded or invested cryptocurrency
  • Received an income in cryptocurrency
  • Converted cryptocurrency to fiat
  • Made a payment with cryptocurrency
  • Earned crypto mining income from transaction fees and block rewards

You do not need to report activity if you:

  • Purchased but did not sell any cryptocurrency
  • Gifted cryptocurrency to someone (under $15,000/person)
  • Purchased cryptocurrency with a Solo 401(k) or Self-Directed IRA
  • Transferred between exchanges or wallets

I received a Form 1099-B but Boxes 1b / 1e are blank. How can I calculate my gain or loss? 

Bittrex is unable to determine the date acquired and original cost basis (or purchase price) of crypto assets transferred in from other sites. The information being reported on the Form 1099-B is the gross proceeds of all assets sold on our platform. 

You should verify and report the purchase price of all crypto assets that correspond to a sale reported on the 1099-B to properly calculate your gain or loss. 

How do I correct errors on my Form 1099? 

To make any corrections, send a request to our support team.

Why did I receive a corrected Form 1099? 

We may issue you a corrected Form 1099 for several reasons. Here are some of the most common cases: 

  • You received any dividend or income adjustments on shares you own 
  • The cost basis for positions received in an account transfer was updated 
  • Your Social Security number was updated after your initial Form 1099 was issued 

Can I get a K-1 form? 

We don’t provide customers with K-1 forms. If you own shares in a limited partnership or trust, that entity should provide the K-1 form for you. 

Does Bittrex report my activity to the IRS? 

Bittrex does not report your activity to the IRS if you sell, trade, or spend your cryptocurrency at this time.  

If you have any additional questions, please file a support ticket.

* Bittrex does not provide any recommendations, consultation, or evaluations for legal advice or regulatory compliance. We do not provide tax planning / filing, financial services, trading or investment advice. Customer identification, personal information, and records of deposits, withdrawals, and trading activity are confidential except as required by law or court order.