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What to Expect for Tax Season

Published 19 January, 2021

    Disclaimer: BlockFi does not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide–and should not be relied on for–tax, legal, or accounting advice. You should always consult your own tax, legal, and accounting advisors before engaging in any transaction.

    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.

    How to Access Your Forms

    To download your tax forms, just follow these steps: 

    1. Log in to your BlockFi account using the web application (note: reports are not available in the mobile app)
    2. Open your Profile options from the navigation menu 
    3. Select ‘Reports’
    4. In the ‘Reports’ screen, go to the ‘Taxes’ section
    5. Select ‘2020’ as the tax year

    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

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    Disclaimer: Rates for BlockFi products are subject to change. Digital currency is not legal tender, is not backed by the government, and BIA accounts are not subject to FDIC or SIPC protections. Security is our top priority. Please see our Vulnerability Disclosure Form and Bug Bounty Program.
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