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File crypto taxes
with ZenLedger
Republic has partnered with ZenLedger to simplify transaction tracking and tax reporting.Get started for freewith ZenLedger
ZenLedger features
ZenLedger automatically aggregates your transactions across wallets and exchanges, computes your capital gains and losses, and auto-fills IRS forms. ZenLedger supports 400+ exchanges, 7000+ token types, 30+ DeFi protocols, ERC-721 NFTs and all wallets. 
Struggling to manage your crypto earnings? Discover ease with our collaboration, offering detailed statements for all your cryptocurrency income, from staking to DeFi.
Navigate your crypto tax reporting without the stress, utilizing ZenLedger’s capabilities to support 400+ exchanges, 100+ DeFi protocols, and 10+ NFT platforms, for quick and accurate tax calculations and reporting.
Utilize ZenLedger's dashboard to carefully implement Tax Loss Harvesting, offering a measured approach to minimize tax liability by balancing your capital gains against losses, potentially leading to improved tax savings.
With ZenLedger, experience the ease of linking with popular tax applications like TurboTax and TaxAct, ensuring a consolidated tax filing experience for all your investments, crypto holdings included, free from the challenges of manual data entry and errors.How to use ZenLedger
Simplify your tax investments today with ZenLedger's simple platform.Navigate to your Republic Wallet
View the "Taxes" section of your wallet. If you don't already have one, you can create a wallet here.Share addresses with ZenLedger
Click the share button on the taxes page to export addresses to ZenLedgerCreate an account on ZenLedger
Once your Zenledger account is created, you will automatically see your addresses.Questions? Answers.
- What exactly is cryptocurrency in terms of U.S. tax law?
Cryptocurrency is recognized by the IRS as property, not currency. This classification means that cryptocurrencies like Bitcoin and Ethereum are treated similarly to other assets such as stocks or real estate for tax purposes.
- How is cryptocurrency taxed in the U.S.?
- Capital Gains Tax: Applies when you sell crypto for fiat, use crypto to purchase goods or services, or exchange one cryptocurrency for another
- Income Tax: Applies to crypto acquired through mining, staking, airdrops, DeFi earnings, P2E game earnings, NFT Sales as an artist, or as payment for services.
- What is fair market value?
The price at which an item can be sold on the open market is called its fair market value. In the case of crypto, the fair market value is the price of crypto in its equivalent fiat currency or U.S. Dollar.
- What determines whether a crypto transaction is taxable or not?
- Taxable Events: Selling crypto for fiat currency, swapping crypto, paying for goods/services in crypto, and earning crypto through mining or airdrops.
- Non-Taxable Events: Buying crypto with fiat and transferring crypto between wallets you own.
- Taxable Events: Selling crypto for fiat currency, swapping crypto, paying for goods/services in crypto, and earning crypto through mining or airdrops.
- Can you explain the specific tax rates for crypto gains?
Tax rates can vary depending on the length of time the asset was held as well as the individuals income
- Short-Term Capital Gains: For crypto held for less than a year, taxed at your regular income tax rate ranging from 10% to 37%.
- Long-Term Capital Gains: For crypto held for more than a year, taxed at reduced rates of 0%, 15%, or 20%, depending on your income bracket.
- Short-Term Capital Gains: For crypto held for less than a year, taxed at your regular income tax rate ranging from 10% to 37%.
- What is cost basis?
Cost basis can be defined as the amount spent to buy an asset (cost price). It also includes any additional expenses that were incurred at the time of acquiring the crypto, such as transaction or gas fees.
- How do you calculate the cost basis for cryptocurrency?
- The cost basis is calculated by adding the purchase price of your crypto to any associated acquisition costs (like transaction fees). This figure is crucial for determining capital gains or losses when the crypto is sold.
- What accounting methods are available for calculating crypto taxes?
Each method can affect the amount of tax owed by altering the calculated capital gains or losses. In the US, FIFO is considered the default, but you should consult your tax professional to determine what is best for you.
- FIFO (First-In, First-Out): The first crypto you purchase is the first sold.
- LIFO (Last-In, First-Out): The last crypto you purchase is the first sold.
- HIFO (Highest-In, First-Out): The crypto with the highest purchase price is sold first.
- Actual Cost Basis – Each cryptocurrency is tracked and any sale is the sale of a specific coin.
- Average Cost Basis – The total amount divided by the number of coins owned.
- FIFO (First-In, First-Out): The first crypto you purchase is the first sold.
- How does crypto tax-loss harvesting work?
- Tax-loss harvesting involves selling crypto at a loss to offset capital gains on other investments, potentially lowering your overall tax liability. This strategy must be carefully managed to comply with IRS regulations. Using a crypto tax software like ZenLedger can help identify Tax-loss harvesting opportunities to minimize your tax liability each year.
- How are NFTs taxed?
- Buying and selling NFTs will incur capital gains or losses depending on how the fair market value of the tokens you used for the transaction has changed since you got them. Also, if you are the creator of NFTs, the revenue that you get is considered regular income and will be taxed appropriately.
- What are the implications of receiving crypto from airdrops or forks?
- Receiving crypto through airdrops or forks is considered ordinary income by the IRS, taxed at your regular income rate. The income is calculated based on the fair market value of the crypto at the time it is received.
- What steps should you take to prepare for crypto tax season?
- Record Keeping: Maintain detailed records of all your crypto transactions, including dates, values, and involved parties.
- Understand Your Transactions: Clearly categorize each transaction (e.g., capital gains, income).
- Use Crypto Tax Software: Consider using specialized software to accurately calculate your crypto taxes.
- How Do Gifts and Donations in Crypto Affect Your Taxes?
- Gifts: If you gift crypto, you do not recognize income or gain. The recipient inherits your cost basis and holding period.
- Donations: Donating crypto to a qualified charitable organization can allow you to deduct the market value at the time of donation, without paying capital gains tax, subject to certain limits.
- What if I was the victim of a hack or scam?
- Losses on cryptocurrency investments due to scams, hacks, or other thefts are not treated as casualty losses, but instead, as investment losses.
- According to tax code 165 (c)(ii), even though the investment is not linked to any business, your investments have been put in for profit. This is why any loss that has occurred as a result of scams, theft, or fraud is tax losses. Crypto losses as a result of hacks and theft can be claimed as $0 proceeds transactions on Form 8949.
- What should you do if you have unreported previous crypto earnings or losses?
- If you have unreported crypto transactions from previous years, it's advisable to amend your past tax returns to include these transactions. Consulting with a tax professional experienced in cryptocurrency can help navigate the process and avoid potential penalties.
Republic does not provide legal, tax, accounting, or financial advice. The information provided on our platform is for informational purposes only and should not be construed as professional advice. Users are encouraged to seek advice from qualified professionals regarding their specific legal, tax, accounting, or financial situations.
Additionally, Republic may receive compensation for referrals made through our platform. Any compensation received does not influence the recommendations or information provided to users. Users should conduct their own due diligence and consider their individual circumstances before making any decisions as to the tax services and providers they use. By using the Republic platform, you acknowledge and agree that Republic is not liable for any damages or losses arising from reliance on the information provided, or the services provided by ZenLedger.
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