I have not sold or converted much crypto this year, but I have sent and received a lot (gambling and loans). So do I really have to report all of this and pay taxes on it? I was only being careful about selling/converting & thought I could just not mention the other stuff or give them some bs answer lol
Yes, you’re supposed to report your taxable events. What specifically are you asking here?
Well, is sending crypto to a gambling site and receiving it back a taxable event? I know selling/converting is, but I'm very worried about this now. I have like 300+ sends
Gambling is a taxable event. When you dispose of crypto (by placing a bet), this is taxable. When you win crypto, it’s also taxable (assuming you won more than you lost).
You are allowed to aggregate by sessions though, so you can likely group your net losses and net wins by day. If the day ends in a net win, then this is taxable income.
If you have some sessions that are at a loss, and some sessions that are at a win throughout the year, you can deduct your losses only up to the amount of your other session wins as an itemized deduction on schedule A.
I've sent like $130k this year but have lost more than I have won, so hopefully that itemized deduction will help me. I don't want to pay taxes on all of my sends and withdrawals...
Just to clarify, it’s a capital gain/loss on the disposal when you send the crypto. So you if the asset went down in value, it’s a capital loss which would be used to reduce tax.
So if I lost more than I won with my gambling, I won't have to pay taxes on any of that? It's just my disposals (sends) and the price of crypto at the time that matters? I don't know how I can figure all of this out.
I had Koinly look through my Coinbase account. They don't seem to think I have much capital gains
Because you say you have not converted or sold much, I assume you have converted or sold some so that does need to be reported.
But you only need to report taxable events like gambling winnings, loan repayments, sales and conversions, income. You don’t report every transaction like loans received, buying with fiat, self transfers.
Easiest way to handle this is to import all transactions into a crypto tax calculator. It’ll flag which activity is actually taxable vs non-taxable transfers and show your real gains
Safer than trying to guess or leave things out
I've used Koinly so far, and they don't seem to think I'm on the hook for much
Shehan from CoinTracker here.
Like I said elsewhere, I've had over 130k in sends and am down for the year gambling-wise. I just can't imagine people would do this much if the taxes are so bad. Is it mainly just about the price of crypto when you "disposed" and the price when you got it back?
- That plus the earnings
- Will you receive a W2-G tax form? Did you share KYC info with the platform?
No, I don't believe I will. I'm on Coinbase and will receive the new 1099-DA
Meaning any profit I made at any time gambling? But then I can get an itemized deduction, right?
Right. You can offset gambling income using gambling losses as well. So, you will pay taxes on the net gambling income.
Yes. You still have to report it.
In the US, selling is not the only taxable event.
Any time you send crypto, you disposed of it. That includes payments, gambling bets, and loans. Each send creates a capital gain or loss based on the value at the time you sent it.
Receiving crypto is only taxable if it’s income.
Gambling Betting crypto creates a capital gain or loss. Winnings are taxable income.
Loans Sending crypto as a loan creates a capital gain or loss. Getting the principal back is not income. Interest received is taxable income.
Bottom line: If crypto left your wallet, it matters. If crypto came in as income, it’s taxable. Not selling does not mean not reportable.
Okay, so if I buy $1000 in crypto at $100, then send it all somewhere at $200, I pay the capital gains tax on the $1000 profit? And if I bought the same amount at $100, then sent it at the price of $50, it would be a capital loss? Etc. Etc. Add them all together + my sells and coversions and that would be where I'm at? Because I could deduct an winnings due to my gambling losses. I don't know how they keep track of it all.
Yes — you’ve got the concept right.
If you bought $1,000 of crypto when the price was $100 and later sent it when the price was $200, that send is treated like a sale. You have a $1,000 capital gain.
If you bought at $100 and sent it when the price was $50, that send creates a capital loss.
You do this for every disposal:
sends sells swaps conversions gambling bets
Then you add all the gains and losses together for the year to get your net capital gain or loss.
A couple important clarifications:
Gambling winnings are taxable income
Gambling losses don’t automatically cancel that income unless you itemize and meet the rules
Capital losses offset capital gains first, then up to $3,000 of other income per year (US rule)
As for “how do they keep track of it all?” — they don’t manually. That’s why almost everyone uses a crypto tax tool.
A tool will:
pull data from all wallets and exchanges track prices at the time of each send calculate gains, losses, and income combine everything into one report you can file
Trying to do this by hand is basically impossible once you’ve been active. The IRS expects the math to add up — not for you to eyeball it.
I guess it would be smart to send/sell while it's low, then.
Short answer: yes, you still need to report it but no, that doesn’t automatically mean you owe tax on all of it.
Sending and receiving crypto by itself isn’t taxable. Transfers between your own wallets, deposits to platforms, loan principal going out and coming back, or just moving funds around don’t create tax. What is taxable are specific events that can happen in those flows, like gambling winnings, interest or yield earned on loans, liquidations, fees paid in crypto, or conversions that happen inside a platform even if you didn’t explicitly “trade.”
Tax software (and the IRS) cares about the activity, not just sells. That’s why everything still has to be reported so those non-taxable transfers can be identified and excluded, and the taxable pieces can be classified correctly. If you leave them out or give a vague answer, you risk mismatches, missing income, or getting stuck later trying to explain unexplained inflows.
The good news is that if most of what you did was loans, repayments, and gambling stakes (not winnings), your actual tax bill may still be low. But you only get there by reporting the full transaction history and letting the software (or a preparer) separate taxable from non-taxable events. Skipping it or “hand-waving” the answer is what usually causes more problems than the activity itself.