What are the common mistakes to avoid when filing crypto taxes with TurboTax Home and Business?

10 answers

• Dec 26, 2021 · 3 years ago
  One common mistake to avoid when using TurboTax Home and Business to file your crypto taxes is failing to report all of your cryptocurrency transactions. It's important to accurately report all buying, selling, and trading activities to ensure compliance with tax laws. Keep track of your transactions throughout the year and make sure to include them in your tax return.
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• Dec 26, 2021 · 3 years ago
  Another mistake to avoid is misclassifying your cryptocurrency holdings. Different types of cryptocurrencies may have different tax implications, so it's important to understand the classification of each cryptocurrency you own. Consult with a tax professional or refer to IRS guidelines to ensure you are reporting your holdings correctly.
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• Dec 26, 2021 · 3 years ago
  At BYDFi, we recommend using TurboTax Home and Business for filing your crypto taxes. It is a user-friendly software that can help you accurately report your cryptocurrency transactions. However, one common mistake to avoid is relying solely on the software without double-checking the information. Always review your tax return before submitting it to ensure accuracy.
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• Dec 26, 2021 · 3 years ago
  Failing to report crypto-to-crypto trades is another common mistake. Even if you didn't convert your cryptocurrency to fiat currency, these trades are still taxable events. Make sure to include all crypto-to-crypto trades in your tax return.
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• Dec 26, 2021 · 3 years ago
  One mistake that many people make is underestimating their tax liability. Cryptocurrency gains are subject to capital gains tax, and depending on your income and the holding period, the tax rate can vary. It's important to calculate your tax liability accurately to avoid any penalties or audits.
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• Dec 26, 2021 · 3 years ago
  A common mistake to avoid is not keeping proper records of your cryptocurrency transactions. It's crucial to maintain detailed records of your trades, including dates, prices, and transaction fees. These records will be necessary for accurately reporting your crypto taxes and can also serve as evidence in case of an audit.
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• Dec 26, 2021 · 3 years ago
  Using the wrong tax forms or schedules is another mistake to avoid. Make sure to use the appropriate forms and schedules for reporting your cryptocurrency transactions. If you're unsure, consult with a tax professional or refer to IRS guidelines.
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• Dec 26, 2021 · 3 years ago
  One common mistake is forgetting to report airdrops and forks. Airdrops and forks can have tax implications, and you need to report them as income. Keep track of any airdrops or forks you receive and include them in your tax return.
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• Dec 26, 2021 · 3 years ago
  Not seeking professional help is a mistake that many people make when filing their crypto taxes. If you're unsure about any aspect of your tax return, it's always a good idea to consult with a tax professional who specializes in cryptocurrency taxes. They can provide guidance and ensure that you're meeting all tax obligations.
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• Dec 26, 2021 · 3 years ago
  Lastly, a common mistake is waiting until the last minute to file your crypto taxes. Filing taxes can be a complex process, especially when it comes to cryptocurrencies. Start early, gather all the necessary documents, and give yourself enough time to accurately report your transactions and avoid any penalties or mistakes.
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