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Cryptocurrency Binance 1099K

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    #1

    Cryptocurrency Binance 1099K

    I am needing some guidance on a 1099K from the crypto platform Binance.us.
    They sent a 1099k for 2020 and their reports do not show any basis on the crypto.
    The client has a 1099k for a million dollars that this money is really the same amount of money being used over and over to buy and sell. For example he took the same 20k and bought and sold several times a day. He really did not make any profit on this. His bank statements show no money from Binance for the crypto. When he sold he just rebought it and sold it over and over.
    Does anyone have a 1099k from Binance from 2020? Binance is also known as BAM Trading Services. They have no phone number to call them on.
    ANy help on this issue would be great.
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    #2
    It is not any different from receiving a 1099-B with gross proceeds reported and no basis reported. You put it on Schedule D and the feeder schedules/forms. The taxable amount should be net of losses for the most part.

    I remember the first time in my tenure at H&R that one of my office-mates had a Schedule D with some multi-millions of dollars for me to review and I was momentarily impressed, until she explained, it was just the same much smaller amount of money being turned over and over.
    "You said it, they'll never know the difference. Come on, we'll paint our way out!" - Moe Howard

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      #3
      The client states that the there were no profits and basically he lost money in his view or if anything made almost nothing. Binance in 2020 does not show the basis. There was a basis on all the sales. He bought the crypto in the past and was just turning it over and over.
      What do you suggest?
      We need a way to show the basis was close to the 1.1 million they said he sold.

      Comment

        #4
        No, Binance US does not provide financial or EOFY statements. But you can download a CSV file of your Binance US transaction history and use this as an end of year statement instead

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          #5
          "We need a way to show the basis"

          Like I said, it's no different than if you receive a 1099-B with basis not reported to the IRS. It is the taxpayer's responsibility to track basis. At the risk of being snarky (I know, hasn't stopped me before...) if he's sophisticated enough to be day trading cryptocurrency, it seems like a spreadsheet with basis should be well within the taxpayer's capabilities.
          "You said it, they'll never know the difference. Come on, we'll paint our way out!" - Moe Howard

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            #6
            Your client can track his own basis, or perhaps the download from Binance will give him what he needs, or his basis is zero. It's up to your client.

            Comment

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