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How to file your Bitcoin (BTC) taxes with Koinly

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Last updated: Monday, 30 January 2023

How to do your Bitcoin (BTC)  taxes with Koinly 

Bitcoin remains the market leading cryptocurrency, with millions of investors hodling, trading and mining. Whatever your investments, Koinly can help with your Bitcoin taxes. Here’s how.

  1. Sign up to Koinly and choose your country and currency
  2. Safely connect Koinly to the Bitcoin blockchain via your public address or a CSV file
  3. Koinly categorizes BTC transactions into gains, losses and income
  4. Koinly calculates your BTC Capital Gains Tax and BTC Income Tax
  5. Download your Bitcoin tax report from Koinly
  6. File your Bitcoin taxes online or with your crypto tax accountant

Watch how to do your Bitcoin taxes fast

How to find your Bitcoin (BTC) public key

You can export your Bitcoin (BTC) xpub key from most wallets - but the way to get your xpub key varies depending on the wallet you're using. We've got a help guide on how to get xpub keys from many popular wallets. There are a few wallets that do not provide xpub keys - we have a recovery phrase method that will help you get your xpub key in these instances. 

Koinly supports all the top Bitcoin wallets! Popular BTC wallets include:

Don't see your wallet? You'll find easy to follow steps on how to get your Bitcoin public address from hundreds of wallets here.

Please note: your xpub key is different for every single blockchain, so you'll need to export it separately for all the coins you're transacting with for a given wallet, for example your xpub BTC key, xpub BCH key, xpub LTC key. 

And don't forget, in order for Koinly to calculate your crypto taxes correctly you’ll need to add your public address from every wallet you use for Bitcoin.

How to connect Bitcoin to Koinly automatically

On Koinly

  1. Sign up or log in into Koinly and head to wallets
  2. Select add new wallet in the top right corner
  3. In the search bar, search for Bitcoin
  4. Select Bitcoin (BTC)
  5. Enter your Bitcoin public address
  6. Select import

Important

You’ll need your Bitcoin public address from each wallet you use to interact with the Bitcoin blockchain to calculate your taxes accurately.

How to integrate Bitcoin with Koinly using CSV

If you prefer to use CSV files to integrate your Bitcoin wallets with Koinly, you can. Here's how.

How to download and export a Bitcoin CSV file

Depending on the Bitcoin wallet you’re using, you may be able to export a CSV file of your transaction history from your wallet or use a Bitcoin blockchain explorer to export one. We’ve got instructions on how to get a CSV file from a number of crypto wallets on our integration pages.

Important

1. When downloading your CSV files, check that the file covers your full trading history.

2. Remember to download and upload CSV files for all your BTC Wallets.

3. Don't forget to tag your transactions according to your country’s crypto tax rules. This will ensure that they show up correctly as income on your Bitcoin tax reports.

How do I troubleshoot my Bitcoin integration to Koinly?

Problems connecting Bitcoin and Koinly? No worries - we're here to help:

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How is mining Bitcoin taxed?

Bitcoin mining tax depends on where you live, as some tax offices allow hobby mining income to be tax free upon receipt. However, the majority of tax offices including the IRS, view Bitcoin mining rewards as additional income, which is subject to Income Tax upon receipt.

How is being paid in Bitcoin taxed?

Getting paid in Bitcoin is generally viewed the same way being paid in fiat currency is. You’ll need to identify the fair market value of any BTC on the day you received it and you’ll pay Income Tax on this amount upon receipt. 

How are Bitcoin rewards taxed? 

If you’re earning Bitcoin rewards - for example, earning interest on your Bitcoin investments, these are generally viewed as additional income and subject to Income Tax.

Do you have to pay tax on Bitcoin?

Yes. You need to pay tax on Bitcoin. The tax you’ll pay depends on the transaction you’re making and where you live. You can learn more about Bitcoin and crypto tax in your country in our crypto country tax guides.

Can the IRS track Bitcoin?

Yes. The IRS can track Bitcoin and other cryptocurrencies. If you’re trading Bitcoin on centralized crypto exchanges, the majority of these exchanges issue 1099-MISC forms to the IRS for any users earning more than $600 in income in a single financial year. Larger exchanges may also be compelled to share further KYC data with the IRS to ensure tax compliance.