Coinbase Launched Free Tax Center Without Issuing 1099 Forms

Coinbase launched free tax center that will make filing taxes less painful and will not issue 1099 forms as we can see more today in our latest Coinbase news.

Coinbase’s new service will help streamline the process of calculating crypto profits which is why Coinbase launched free tax center service. The crypto owners are already having a hard time in 2022 and many face a new worry which is the calculation of the tax they owe by the IRS filing deadline of April 18. For Coinbase owners, the burden will be much easier thanks to the next tax center as the company launched it and will show their taxable activity including short and long term gains and losses all In one place.
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The new offering is a huge step forward because users had to manually calculate how much they’re earned and what tax rate applied to their profits. The company said in a blog post:

“We’re simplifying the process by showing each customer a personalized summary of their taxable activity on Coinbase, broken out over time by realized gains/losses and miscellaneous income. Customers can use these amounts to prepare and file their taxes either with their personal accountants or directly with tax prep software like TurboTax.”

The company shared a screenshot of the new tax center product. The exchange explained that users who rely on its Pro product or conduct transactions using an external wallet can obtain free crypto reports from CoinTracker. All of this came at a time when the US government threw an eye on crypto taxes as a key new revenue source in order to pay for its new trillion-dollar infrastructure bill and other spending obligations. In the past, the government focused mainly on searching out crypto whales that sought to avoid paying taxes but in the past two years, the IRS looked for a way to cast a broader net including using the common 1040 form to ask every American if they own crypto.

The government’s new scrutiny gave a rise to a segment of the crypto industry that built tax and compliance tools like the ones used for other investment sectors. While the new tax center will make tax filing easier for a lot of customers, the company is not taking the step of issuing 1099 forms that are used by banks and brokerages to tell the customers how much money they made from investmetns. One coinbase spokesperson said the company doesn’t have a legal obligation to issue these forms but they will issue one to those customers that make huge income through fees and rewards:

“We do not issue 1099s for the sale of crypto assets, as it is not required by the IRS. Coinbase will provide 1099-MISC IRS forms to customers who earned more than $600 in fee income and rewards for the 2021 tax year.”