Overview
The goal of this page is to inform you about whether, when, and how to file your taxes for Bitcoin activity. Notwithstanding anything to the contrary, we do not offer or give tax, accounting, legal, or financial advice. Please consult with a tax professional to determine your specific situation.
How is Bitcoin classified by the IRS?
The IRS has stated in Notice 2014-21 that Bitcoin is a virtual currency to be treated as property. For that reason, many of the rules and processes that you may be familiar with from filing taxes for other investments are relevant to Bitcoin. For example:
- Taxes are based on capital gains or losses from the sale of Bitcoin
- The tax rate is variable, based on factors such as the duration the asset was held (short term (held 1 year or less) vs. long term (held at least a year and a day) and your income
- Wash sale rules do not apply for tax loss harvests in the United States. You can sell and rebuy your Bitcoin near-immediately without triggering wash sale rules because such rules only apply to securities like Bitcoin ETFs.
If you are looking to read more about whether, when, and how taxes are applied, the following may help:
I didn't sell any Bitcoin. Do I owe taxes?
Under current applicable law, no. However, as always, please consult with a tax professional to determine your specific situation.
When do I need to file my taxes by?
As per the IRS, the filing deadline is April 15 for most taxpayers. In addition, if you are looking to extend, you can follow this link for more information.
How do I file my taxes?
The process for filing your taxes is different for Non-Retirement vs Retirement Accounts:
Non-Retirement Accounts
You will need to submit IRS Form 8949 as part of your tax filing. If you are unclear about where to begin, we recommend reading Turbotax's 101 Article.
As a general principle, you will likely want to use Swan's CSV exports to work with a CPA and/or Tax Software in the following situations:
- You want to optimize your tax situation by evaluating different cost methodologies, such as FIFO, HIFO, or LIFO. Many people who tax-loss-harvest use HIFO ("Highest in, first out") in order to maximize their capital losses. This is also known as High-Cost Lot Method and is a type of Specified Lots or Specified ID approach.
- You transferred Bitcoin into Swan from self-custody or a different exchange/platform. For example, you bought Bitcoin with Swan, withdrew to self-custody and redeposited Bitcoin. In this type of situation, Swan (nor other platforms or exchanges) does not know that it is the same Bitcoin, and so will not be able to track your cost basis accurately. Using a tax professional or tax software may be particularly useful here. Keep good records, track and enter the correct cost basis.
- You bought and/or sold Bitcoin from someone other than Swan. In this situation, you should take the transaction history reporting from each platform that you used, and use tax software and/or a CPA to produce a single, consolidated 8949.
In these scenarios, the best thing to do generally is to start with the Swan Tax CSV to produce Form 8949 and, if you can, compare it to your bank and other records. To do this, you should either work with a CPA and/or use special tax software like Cointracker.io or Zenledger. Tax software or a CPA can help you aggregate the appropriate data, choose the accounting methodology that is best for you, and submit your Form 8949 accurately.
Retirement Accounts
Depending on your Account type and use case, you may receive up to four different forms (please see below). You may need to submit up to two forms (5498 and 1099-R) to your CPA and/or Tax Software, while up to two other forms (FMV and RMD) are informational only.
What data does Swan provide me to help file?
There are three types of reports that Swan provides to help you file your taxes:
| Report | Description | Location |
| Cointracker.io Tax CSV |
You can upload this CSV directly into your tax software, such as Cointracker.io. |
Two locations: 1) At the bottom of your Dashboard "Tax CSV" 2) Account Settings -> Export Account Data -> Swan Tax Report |
| Swan Deposits and Purchases CSV |
This report is similar to the above report, with two differences: 1) Rather than only containing USD Deposits that had a fee taken on deposit, it contains ALL deposit information. 2) Fees are shown as a unique line item
CPAs may prefer this reporting structure or the above Tax CSV. We recommend you send them both. |
Two locations: 1) At the bottom of your Dashboard "Deposits & Purchases CSV" 2) Account Settings -> Export Account Data -> Deposits and Purchases |
| IRS Forms (Retirement Accounts Only) | Retirement accounts may receive up to 3 different forms (see below). Non-retirement (brokerage) accounts do not receive these forms. Instead, you should rely on your Swan CSV Exports (see above). |
To access your forms, please log into the Swan Dashboard on swan.com and click Archived Accounts. Then, click into your account, click Settings on the top nav bar, and go to Documents. See the next section for a description of which documents (if any) you are receiving and why. |
What Retirement Account forms should I expect for my situation?
Depending on your activity, you may download up to 3 different forms for Retirement Accounts. If you did not participate in any of the below activities, you won't receive any forms.
| Form | Description |
| 1099-R | Form 1099-R is used to report the distribution of retirement funds and/or Roth conversions. |
| 5498 [Not available on Swan until May] | If you are claiming a deduction for your IRA contributions, you can reference Form 5498 to find your total contributions for the tax year. This form is for informational purposes only and is not required for tax filing. |
| RMD Statement | Required Minimum Distribution Statement - this is an informational statement to participants who are required to take a distribution each year |