Wondering how to report your Binance Smart Chain taxes?
For most crypto investors, tax reporting is stressful and difficult. Trying to collect all the information you need on your cryptocurrency gains, losses, and income can take hours of time and effort.
In this guide, we’ll break down everything you need to know about Binance Smart Chain taxes. We’ll discuss the basics of cryptocurrency taxation and share a simple 3-step process to help you report your Binance Smart Chain taxes in minutes.
Binance Smart Chain (BSC) was founded in April 2019 by Binance, one of the world’s biggest cryptocurrency exchanges. Similar to blockchains like Ethereum, Binance Smart Chain allows developers to write smart contracts and create decentralized applications.
Today, Binance Smart Chain supports dozens of decentralized applications. Because the blockchain offers lower gas fees and is compatible with the Ethereum Virtual Machine, many investors bridge their assets to BSC to make transactions.
Just like transactions on other blockchains, Binance Smart Chain transactions are subject to capital gains and income tax.
For more information, check out our complete guide to cryptocurrency taxes.
At this time, the IRS hasn’t given out clear guidance on whether wrapping/bridging cryptocurrency to another blockchain is considered a taxable swap. The conservative approach is to report the transaction as taxable and pay capital gains based on how much your cryptocurrency has changed since you originally received it.
For more information, check out our guide on wrapped/bridged cryptocurrency taxes.
While Binance Smart Chain does not send 1099 forms to users, it’s important to remember that all transactions on the blockchain are publicly visible.
In the past, the IRS has partnered with contractors like Chainalysis to track blockchain transactions and crack down on tax fraud.
Many investors have trouble reporting taxes on their blockchain transactions. After all, manually collecting records of your taxable transactions can feel overwhelming.
Luckily, cryptocurrency tax software like CoinLedger can simplify the process. Here’s how it works.
And that’s it! Once you’re done, you can import transactions from other blockchains and exchanges and generate a comprehensive crypto tax report.
Looking to report your Binance Smart Chain taxes? Try CoinLedger, the platform trusted by more than 300,000 investors across the globe.
Get started with a free preview report — there’s no need to enter your credit card details until you’re 100% sure your information is correct!