Trying to report your crypto taxes can be a struggle — whether you’re using Robinhood or another platform.
While the platform makes it easy for users to file taxes on capital gains from stocks, Robinhood and other exchanges often have trouble with crypto tax reporting due to cryptocurrency’s unique properties.
In this article, we’ll break down everything you need to know about Robinhood crypto taxes — including the taxability of specific transactions and how you can report your Robinhood crypto on your tax return.
Robinhood is a platform that allows users to buy, sell, and trade stocks and cryptocurrencies. The platform is famous for offering commission-free trading.
Originally, Robinhood did not allow investors to transfer crypto into our out of the platform. Starting in 2021, the platform rolled out Robinhood Wallets, which gave users the ability to freely transfer, trade, and spend their cryptocurrency.
In the United States, cryptocurrency is subject to capital gains tax and ordinary income tax.
The tax rates you pay on cryptocurrency vary depending on several factors such as your tax bracket and how long you held your crypto.
For more information on how cryptocurrency taxes, check out our Ultimate Guide To Cryptocurrency Taxes.
Currently, Robinhood allows users to download a complete form (1099-B) showing investors their complete capital gains and losses for the year.
You can download your 1099-B right from your Robinhood account. Similar to other types of tax documents received at year-end (W2 etc), you can import this 1099-B that you receive from Robinhood into tax filing software such as TurboTax or give it directly to your tax professional to file on your behalf.
If you’ve transferred cryptocurrency into or out of Robinhood, it’s possible that your tax forms will be inaccurate.
Major exchanges have trouble tracking taxes due to cryptocurrency’s unique properties. When you transfer your crypto into or out of an exchange like Robinhood, it’s difficult for the platform to track your cost basis and capital gains.
Consider the following example.
In this case, Ryan should have a capital gain of $500. However, if he hasn’t kept records of his cost basis, he may be forced to recognize his entire $1,500 sale as a capital gain.
Luckily, there’s an easier way to report your taxes. Crypto tax software like CoinLedger can create an aggregated crypto tax report to track your gains, losses, and income across all of your wallets and exchanges.
CoinLedger can help you file your Robinhood crypto taxes in minutes.
If you transferred your cryptocurrency into and/or out of Robinhood, you can map your crypto transaction history to our universal CSV template. Once you’re done, you can upload your transactions to CoinLedger.
If you never transferred your cryptocurrency into or out of Robinhood, you should not import your Robinhood transactions into CoinLedger. Instead, you can send your Form 1099-B to your tax professional or upload it to your tax platform of choice. You can use CoinLedger to report your transactions from other cryptocurrency exchanges and wallets!
CoinLedger is designed to take the stress out of your tax season. The platform integrates with the world’s biggest exchanges and blockchains to help you report your taxes in minutes.
Disclaimer: This guide is provided for informational purposes only. It is not intended to substitute tax, audit, accounting, investment, financial, nor legal advice.