How To File Your eToro Taxes
eToro is a popular crypto exchange worldwide, offering investors low fees and an easy to use interface. For new crypto investors, eToro has a virtual dummy account to give you a trial run navigating the world of crypto before you dive in head-first. There's also excellent advice and strategies from more experienced crypto investors available within the platform. Koinly can help you do your eToro taxes safely, quickly, and accurately.
Follow these steps to download your eToro data:
- Log in to your eToro account.
- Select portfolio from the left-hand menu.
- From the menu at the top, select history.
- Select the settings icon in the top right corner.
- Select account statement.
- Select your time frame.
- Select export. Make sure you pick the Excel file format, not the PDF format.
- Create a free account on Koinly
- Complete onboarding until you get to the Wallets page and find eToro in the list
- Click on it and select "File import" in the import options screen
- Upload the files you downloaded from eToro (one at a time) and click on Import
- Review your transactions on the Transactions page to ensure everything is tagged correctly and no missing data
- Go to the Tax Reports page to view your tax liability!
Please see this article on the limitations with eToro's data
How are eToro transactions taxed?
The tax you'll pay on your eToro transactions all depends on where you live and the specific transactions you've made - so make sure to check out our crypto tax guides for the rules where you live. This said you'll generally pay one of two taxes:
Capital Gains Tax: Whenever you sell or trade crypto on eToro and make a gain, you'll generally pay Capital Gains Tax on that gain.
Income Tax: Whenever you earn new crypto on eToro - for example, Cardano or ETH staking rewards - you may need to pay Income Tax upon receipt based on the fair market value of your tokens.
Does eToro report to the IRS?
Yes. eToro reports to the IRS as they issue 1099 forms to users. Any time you receive a 1099 form, the IRS receives an identical copy.
How do I file my eToro taxes?
To start, you'll need to calculate any capital gains, losses or income from your eToro transactions. This means you need to identify each taxable transaction on eToro, identify your cost basis, calculate any subsequent capital gains or losses and calculate the fair market value of any income in your fiat currency on the day you received it.
You can do this yourself, but it's a lot of work. Especially as you need to do this for each crypto exchange and wallet you use. This is why most investors opt to use a crypto tax calculator like Koinly. With Koinly, all you need to do is import a CSV file of your eToro transactions and Koinly will calculate your eToro gains, income and more for you. Better still, Koinly can generate a range of crypto tax reports for investors around the world including IRS tax reports, ATO tax reports, HMRC tax reports and more.
Your frequently asked questions
Does eToro have tax documents?
Yes, eToro issues users with a variety of tax reports. These may be suitable for some users depending on their investments, but for the vast majority of crypto investors, eToro tax reports do not include the information they need to file their crypto taxes accurately.
How do I get eToro tax forms?
You can download and export your eToro trading and transaction history within your eToro account. Then you can either upload this to a crypto tax calculator, or do your taxes manually.
Do you get a 1099 from eToro?
Yes, eToro issues 1099 forms. US residents may receive a consolidated 1099-K or 1099-B form depending on their activities and investments. 1099-B forms list the proceeds and short-term capital gains and losses from investments, while the 1099-K form reports on all transactions broken down by month.
Why can't I just use my 1099 form from eToro to file my taxes?
You can, in theory, but there are a couple of potential issues with your eToro 1099 form.
Firstly, it's important to note that due to the limitations of these forms, your 1099 forms from eToro may contain errors if you've transferred crypto on or off eToro as exchanges cannot track cost basis on other platforms. Learn more about 1099 forms and why they're not ideal for reporting crypto.
As well as this, eToro 1099 forms use the FIFO method as standard. This means your gains and losses are calculated on a first in, first out basis - so the asset you bought first is the asset you sold first. For many investors, this results in higher capital gains than using other cost basis methods. The IRS allows multiple cost basis methods, including Spec ID, LIFO, and HIFO, which may result in lower capital gains. To learn more about cost basis and how it can help you reduce your tax bill, check out our ultimate guide on FIFO, HIFO, LIFO, and Spec ID.
Does eToro provide financial or end of year statements?
No, eToro does not provide an EOFY statement. But you can use your eToro transaction history export to create an end-of-year statement. Just set your date range to cover the last financial year.
Do you pay tax on eToro?
Yes, you are required to calculate and pay any applicable taxes according to your country’s crypto tax rules. If you have made any capital gains or income as a result of your crypto investment activities on eToro, you'll need to report these to your tax office and pay taxes on them.
When does eToro send tax forms?
eToro only issues 1099 forms to some US users. If you’re going to receive a 1099 form from eToro, you should receive it by February of the following financial year at the latest.
Is eToro safe?
Yes. eToro is widely regarded as a secure and compliant crypto exchange. However, your crypto is always safest in a non-custodial, cold wallet.
Does eToro have proof of reserves?
eToro has not yet announced a Merkle Tree proof of reserves audit.
What is eToro?
eToro describes itself as a social investment platform. You can invest in a range of assets using the eToro platform including crypto, stocks, and ETFs.
Is eToro good for crypto?
eToro is widely regarded as a safe and secure platform to invest in crypto and other assets. Some popular features for eToro users include the ability to copy traders, as well as the virtual portfolio feature.
Who are the best traders to copy on eToro?
There are many copy traders on eToro to choose from and the right one for you will depend on your investment strategy and individual circumstances. For each copy trader, you can see how high their return has been for a given period of time, their risk score, and how many people are copying them. You should always do your own research to understand the risks involved before copying another trader.
Which crypto coins are on eToro?
Do I own the crypto I buy on eToro?
Yes. When you purchase crypto on eToro you purchase the underlying asset. eToro buys your crypto on your behalf and holds it in your name.
Should I leave my crypto on eToro?
While eToro is a secure exchange that follows best security practices, exchanges present an appealing target for hackers. The safest place to store your crypto is in a non-custodial, cold wallet. Learn more about the safest way to store crypto.