We are updating the Crypto experience related to Total Gain and Total Return. Please ensure that your app is up to date as we continue this rollout.

Tax reporting can be daunting, but PayPal is on a mission to make reporting cryptocurrency taxes as seamless as possible.

The information provided by PayPal is not intended to be and should not be construed as tax advice. You should seek the advice of a professional tax advisor for any questions regarding your crypto gain/loss, cost basis method, and additional tax filing requirements.

Am I required to file taxes on my crypto?

Starting in 2020, the IRS added a question to the personal federal income tax form (1040) asking taxpayers, “At any time during the tax year, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?”

When answered “Yes,” the IRS would look for a Form 8949 filed by the taxpayer to report capital gain/loss for virtual currency transactions.

How do I file my crypto taxes?

PayPal provides its users with supplemental materials, including a year-end gain/loss statement detailing all taxable dispositions for the year. These documents detail the transaction-level activity you can use to complete your IRS 8949, which includes the date acquired, date disposed of, cost basis (included for user convenience), proceeds, and the resulting gain or loss.

If you have crypto assets outside of PayPal’s platform and subsequently disposed of the assets, PayPal will not have visibility into your information, and it is, therefore, your responsibility to track and report such information.

Visit How do I file my taxes for cryptocurrency? for more information.