What are the common TurboTax errors in 2022 when filing cryptocurrency taxes?

10 answers

• Dec 29, 2021 · 3 years ago
  One common error that people often make when using TurboTax to file their cryptocurrency taxes is failing to accurately report all of their transactions. It's important to remember that every buy, sell, trade, or transfer of cryptocurrency needs to be reported for tax purposes. Failure to do so can result in penalties or audits from the IRS. Make sure to keep detailed records of all your transactions and consult with a tax professional if you're unsure about how to report them.
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• Dec 29, 2021 · 3 years ago
  Another common TurboTax error is incorrectly categorizing cryptocurrency transactions. TurboTax provides different categories for different types of income, such as wages, investments, and self-employment. It's important to choose the correct category for your cryptocurrency transactions to ensure accurate reporting. If you're unsure about which category to choose, consult the IRS guidelines or seek advice from a tax professional.
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• Dec 29, 2021 · 3 years ago
  At BYDFi, we've noticed that some users encounter errors when importing their cryptocurrency transaction data into TurboTax. It's important to double-check the imported data for accuracy and make any necessary adjustments. Additionally, ensure that you're using the correct file format when importing your data into TurboTax. If you continue to experience issues, reach out to TurboTax customer support for assistance.
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• Dec 29, 2021 · 3 years ago
  One mistake that many people make when using TurboTax for cryptocurrency tax filing is not taking advantage of available deductions. There are certain deductions and credits that may apply to cryptocurrency transactions, such as mining expenses or losses from theft or fraud. Make sure to thoroughly research and understand the tax laws and regulations surrounding cryptocurrency to maximize your deductions.
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• Dec 29, 2021 · 3 years ago
  A common error that people make when using TurboTax for cryptocurrency tax filing is not properly calculating their capital gains and losses. It's important to accurately calculate the cost basis and fair market value of your cryptocurrency holdings when determining your capital gains or losses. Failure to do so can result in inaccurate tax filings and potential penalties. Consider using cryptocurrency tax software or consulting with a tax professional to ensure accurate calculations.
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• Dec 29, 2021 · 3 years ago
  Another common TurboTax error is failing to report income from staking or lending cryptocurrency. If you earn interest or rewards from staking or lending your cryptocurrency, it's important to report this as income on your tax return. TurboTax provides specific sections for reporting different types of income, so make sure to include any income earned from cryptocurrency staking or lending.
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• Dec 29, 2021 · 3 years ago
  One common mistake that people make when using TurboTax for cryptocurrency tax filing is not properly documenting their cryptocurrency holdings. It's important to keep track of the date and acquisition cost of each cryptocurrency asset you own. This information is necessary for accurately calculating your capital gains or losses when filing your taxes. Consider using a cryptocurrency portfolio tracker or consulting with a tax professional to ensure proper documentation.
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• Dec 29, 2021 · 3 years ago
  Failing to report foreign cryptocurrency exchanges is another common error when using TurboTax for tax filing. If you have used foreign cryptocurrency exchanges, make sure to report any income or gains from these exchanges on your tax return. TurboTax provides guidance on reporting foreign income, so make sure to follow the instructions carefully.
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• Dec 29, 2021 · 3 years ago
  One common TurboTax error that people encounter when filing cryptocurrency taxes is not properly reporting airdrops or forks. If you have received free cryptocurrency through airdrops or forks, it's important to report this as income on your tax return. TurboTax provides specific sections for reporting these types of income, so make sure to include any airdrops or forks you have received.
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• Dec 29, 2021 · 3 years ago
  Another common mistake is not properly reporting losses from cryptocurrency investments. If you have experienced losses from selling or trading cryptocurrency, it's important to report these losses on your tax return. These losses can potentially offset any capital gains and reduce your overall tax liability. Make sure to accurately report your losses and consult with a tax professional if you're unsure about how to do so.
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