What to Expect for Tax Season

Dealing with taxes can be daunting, especially when you’re a crypto investor. Fortunately, BlockFi is here to help with support and services to make tax reporting easier for our US taxpayers.

If you’re a US taxpayer with reportable income, BlockFi may provide you with two separate reports related to your BlockFi Interest Account (BIA) and any trading activity you performed throughout the year.

According to the IRS, earning income on crypto is considered a taxable event in the US, and cryptocurrencies are generally treated as property (similar to gold or shares in publicly owned companies) for tax purposes. That means that interest payments to you on crypto assets are payments of property, making them subject to reporting through the 1099-Miscellaneous (also known as the 1099-MISC) form. Please note, only US taxpayers who have earned more than $600 of interest and bonuses in 2020 will have a 1099-MISC form, which will be available for download by January 31, 2021.  

Additionally, US taxpayers who have traded during 2020 will receive a 1099-B form used to report activity. This report will be made available for download by February 15, 2021.

For international clients, please look to your transaction history and historical monthly interest statements for any details needed to file taxes.

If you’re working with an accountant or tax preparer, you can give them the form. And if you’re using tax preparation software, it will typically ask you to enter any 1099 income you may have earned.

To download your tax forms, just follow these steps: 

From there, you’ll be able to access the relevant documents and use them for tax preparation purposes. 

As always, clients should consult with their tax advisors for information relating to their specific facts and circumstances. For everything else, please feel free to contact us here.