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Does KuCoin Report to the IRS?
Tax season is always a bit of a stressful time, even for those not in the crypto sector. But for those of us who do partake in trading digital assets, taxes can be even more confusing, as a lot of crypto taxes have to be self-reported and calculated.
KuCoin is one of the most popular crypto exchanges, but does KuCoin report to the IRS?
The answer to that question is no because KuCoin isn’t licensed and regulated in the US. This means that you’re going to have to file your taxes for your KuCoin account, so let’s show you how to do just that.
How to Do Your Taxes with KuCoin
Even though KuCoin doesn’t report to the IRS, it provides all users with complete logs of their transactions on the platform. This includes deposits, withdrawals, buys, and sells. As a KuCoin user, it’s your responsibility to report your taxable events to the IRS during tax season. These events include:
- Trading cryptocurrency to fiat currency
- Trading cryptocurrency for another cryptocurrency
- Using cryptocurrency to purchase goods and service
- Earning cryptocurrency as income (staking, liquidity providing, day trading)
All of the above events are considered disposals of cryptocurrency and therefore affect your capital gains or losses on your tax report.
In order to figure out your capital gains or capital losses for your crypto transactions, you simply take your cost basis (what you paid for the asset) and subtract it from the fair market value (what you sold it for). If the number is positive then you have capital gains, if it’s negative, then you have capital losses.
To report your capital gains or losses, you need to complete IRS Form 8949.
To complete IRS Form 8949, you list all of your cryptocurrency trades and sales, along with the date you acquired the crypto asset, the date sold or traded, what you got for the sale or trade, your cost basis, and your gain or loss.
Once you have the relevant trades listed, total them up, and transfer this amount to your IRS 1040 Schedule D. Both of these forms need to be included with your yearly tax return.
How to Track Crypto Transactions
Thankfully, tracking all of your crypto transactions for tax season is fairly easy, especially if you’re only been using an exchange such as KuCoin. KuCoin will keep track of all your crypto transactions for you, you simply need to export a CSV that contains all of the information.
You can do this by going to your KuCoin account page and finding your transaction history, then you can export it to a CSV (spreadsheet). This can also be done for individual components such as a specific asset, deposits only, etc. You can then either take the CSV information and figure out your taxes yourself, or allow a tax service to use the CSV to do your taxes for you.
What Crypto Exchange Does Not Report to the IRS?
Any crypto exchange that isn’t regulated and licensed in the US, such as KuCoin, isn’t going to report user information to the IRS. As long as the exchange isn’t licensed in the US they aren’t required to report to the IRS, though they may comply with a request for information if asked. This means platforms like Binance won’t report to the IRS, but Coinbase will.
If you are a US crypto user, it may be easier to use a platform that does report to the IRS as it could save you some work during tax season. There are many helpful crypto tax platforms that you can use as well.
