Crypto taxes can feel like navigating a complex maze, but with tools like Koinly and TurboTax, you can simplify the process significantly. Koinly helps you accurately calculate your crypto gains and losses, and then TurboTax helps you report them to the IRS. This guide will walk you through the entire process, step-by-step, to ensure a smooth tax filing experience.
Ready to conquer your crypto taxes? Let's dive in!
Navigating Your Crypto Taxes: A Step-by-Step Guide to Importing Koinly into TurboTax
The world of cryptocurrency is exciting, but when tax season rolls around, it can quickly become daunting. Tracking every single trade, transfer, and transaction across multiple exchanges and wallets can feel like an impossible task. Thankfully, services like Koinly exist to aggregate all your crypto activity and generate comprehensive tax reports. But what do you do with those reports? How do you get them into your tax filing software, specifically TurboTax?
This detailed guide will show you exactly how to import your Koinly data into TurboTax, ensuring you accurately report your capital gains, losses, and any crypto income.
Step 1: Prepare Your Koinly Data – The Foundation of Your Crypto Tax Report
Before you even think about opening TurboTax, you need to make sure your Koinly account is pristine and ready to go. This is the most crucial step, as the accuracy of your Koinly data directly impacts your tax return.
Sub-heading 1.1: Sync All Your Crypto Activity
The first and most important part is to ensure Koinly has a complete picture of your crypto universe. This means connecting every single exchange, wallet, and blockchain you've ever used for crypto.
Connect Exchanges via API: For most major exchanges (like Binance, Coinbase, Kraken, etc.), Koinly offers API integration. This is the most efficient way to import your transaction history automatically.
Log into your exchange account.
Find the API settings (often under "Security" or "API Management").
Generate a new API key and secret. Ensure you only grant "Read" access to Koinly; never grant withdrawal permissions.
Enter these keys into Koinly's integration section. Koinly will then automatically pull your data.
Import Wallets via Public Addresses: For non-custodial wallets (like MetaMask, Trust Wallet, Ledger), you'll typically provide your public wallet addresses. Koinly will then scan the blockchain for your transactions.
Upload CSVs for Unsupported Platforms: If you have an exchange or wallet that Koinly doesn't directly integrate with via API or public address, you'll need to export your transaction history as a CSV file from that platform and upload it to Koinly. Make sure the CSV format is compatible or adjust it as needed.
Sub-heading 1.2: Categorize and Review Transactions
Once all your data is imported, Koinly will attempt to categorize transactions automatically. However, it's essential to manually review these, especially for complex transactions.
Mark Transfers Between Your Own Wallets: Koinly is generally good at this, but double-check that transfers between your own wallets (e.g., from an exchange to your Ledger) are marked as "Transfers" and not as taxable sales.
Identify and Tag Income Transactions: Staking rewards, airdrops, mining income, and DeFi rewards are typically considered taxable income. Ensure these are correctly tagged as "Income" in Koinly.
Review Missing Cost Basis: If Koinly flags any transactions with "missing cost basis," this means it doesn't know the original price you paid for certain assets. This often happens if you transferred assets from a platform not linked to Koinly. You'll need to manually add the acquisition details to ensure accurate capital gain/loss calculations.
Sub-heading 1.3: Generate Your Koinly Tax Reports
After meticulously reviewing and correcting your transactions, it's time to generate the reports needed for TurboTax.
Select Your Tax Year and Country: In Koinly, ensure you've selected the correct tax year and that your home country is set to the United States (assuming you're filing with TurboTax US).
Download the "TurboTax Export (Gain/Loss)" CSV: This is the primary file you'll import into TurboTax for your capital gains and losses. Koinly specifically formats this for direct upload.
Download the "Complete Tax Report" (PDF): This report provides a detailed summary of all your crypto activity, including an "Income Summary." You'll refer to this PDF for any crypto income you need to report separately in TurboTax.
Consider Other Reports (Optional): Koinly offers other reports like Form 8949 and Schedule D. While TurboTax can generate these from the imported data, it's good to have them for your records and reconciliation.
Step 2: Access TurboTax and Prepare for Import
With your Koinly reports ready, it's time to fire up TurboTax. The process is slightly different depending on whether you're using TurboTax Online or the Desktop version.
Sub-heading 2.1: Log In to TurboTax
TurboTax Online: Go to the TurboTax website and log in to your account. Select the tax year you are filing for.
TurboTax Desktop: Open the TurboTax software on your computer and open your tax return for the relevant year.
Sub-heading 2.2: Navigate to the Investment Income Section
This is where you'll report your crypto capital gains and losses.
For TurboTax Online:
From the main menu, go to "Wages & Income" (or "Income & Expenses").
Scroll down and look for the "Investments and Savings (1099-B, 1099-INT, 1099-DIV, 1099-K, Crypto)" section.
Click "Start", "Revisit", or "Edit" next to it.
For TurboTax Desktop:
Navigate to the "Income" or "Investments" section.
Look for options related to "Stocks, Mutual Funds, Bonds, Other" or "Cryptocurrency."
Sub-heading 2.3: Indicate Investment Income
TurboTax will likely ask you a general question about whether you had investment income.
On the page asking “Did you have investment income in [Tax Year]?”, select "Yes". Even if you had net losses, you need to select "Yes" to report them.
Step 3: Import Your Koinly Capital Gains/Losses into TurboTax
Now for the direct import of your Koinly data.
Sub-heading 3.1: Choose the Import Method
TurboTax will present options for importing investment data. It's crucial to select the correct one.
On the screen where TurboTax asks how you want to enter your investment sales, choose "Enter a different way".
Then, select "Cryptocurrency" and click "Continue."
Next, choose "Upload it from my computer" and click "Continue."
Sub-heading 3.2: Specify Koinly as the Service
TurboTax will ask for the name of the crypto service you used.
From the dropdown menu for “What's the name of the crypto service you used?”, select "Other".
In the "Name" field that appears, type in "Koinly".
For the "CSV type," select "Gain/Loss Report or Form 1099-B".
Click "Continue."
Sub-heading 3.3: Upload the Koinly CSV
This is where you upload the file you downloaded from Koinly.
Browse for and select your "Koinly TurboTax Export (Gain/Loss)" CSV file.
Click "Upload."
TurboTax should confirm the upload was successful.
Sub-heading 3.4: Review and Reconcile
After the upload, TurboTax will process the data and present a summary.
TurboTax may ask you to "Review your sales." You can generally skip this and click "Continue" as Koinly's report already aggregates the necessary information. Trying to review thousands of individual transactions can be overwhelming and unnecessary if Koinly's data is accurate.
Compare the totals shown in TurboTax with the "Capital Gains Summary" section of your Koinly Complete Tax Report. A small difference is normal due to TurboTax rounding figures. If there's a significant discrepancy, go back to Koinly and re-verify your data.
Once satisfied, click "Continue."
Step 4: Report Your Crypto Income (If Applicable)
Crypto income (staking rewards, airdrops, mining income, etc.) is generally reported separately from capital gains/losses in TurboTax.
Sub-heading 4.1: Navigate to Other Income Section
From the main menu in TurboTax, go to "Wages & Income" (or "Income & Expenses").
Scroll down to "Less Common Income".
Click "Start" or "Revisit" next to "Miscellaneous Income (1099-A, 1099-C)."
Sub-heading 4.2: Add Other Reportable Income
Click "Start" or "Revisit" next to "Other Reportable Income."
TurboTax will ask, "Any other taxable income?" Select "Yes."
Sub-heading 4.3: Enter Crypto Income Details
In the "Description" field, enter a clear description, such as "Crypto Staking Rewards," "Crypto Airdrops," or "Crypto Mining Income." You can use a general description like "Other Crypto Income" if you have various sources.
Refer to the "Income Summary" section of your Koinly Complete Tax Report (PDF). Take the total amount of your crypto income and enter it into the "Amount" box in TurboTax.
Click "Continue."
Review the summary of your miscellaneous income and click "Done."
Step 5: Final Review and Filing
You've done the heavy lifting! Now, it's about the final checks.
Sub-heading 5.1: Double-Check All Sections
Before filing, carefully review all sections of your TurboTax return.
Ensure that your crypto capital gains/losses and income figures align with your Koinly reports.
Look for any red flags or warnings from TurboTax.
Sub-heading 5.2: Reconcile with Koinly's Complete Tax Report
Have your Koinly Complete Tax Report (PDF) open.
Compare the final capital gain/loss figures and total income reported in TurboTax against the corresponding sections in your Koinly report. Minor rounding differences are okay, but large discrepancies warrant a re-evaluation.
Sub-heading 5.3: Proceed to File
Once you're confident that all your information is accurate, you can proceed with filing your tax return through TurboTax.
Follow TurboTax's prompts to review, pay (if applicable), and submit your return to the IRS.
Common Issues and Troubleshooting
"TurboTax says my file isn't compatible!"
Ensure you downloaded the specific "TurboTax Export (Gain/Loss)" file from Koinly. Other Koinly CSVs may not be formatted correctly for direct import.
Do not open or edit the Koinly CSV file before uploading it to TurboTax. Opening it in programs like Excel can sometimes alter the formatting or change the file type, making it unreadable by TurboTax.
Check your Koinly settings to ensure your date format is correct for the US (MM/DD/YYYY).
"TurboTax is asking me to review all transactions!"
This is a recent addition for some TurboTax versions when importing CSVs. It's generally optional and can be skipped by clicking "Continue", especially if you have many transactions.
"I have more than 3,000 transactions!"
TurboTax has a limit on the number of lines in a CSV. If your Koinly report exceeds this (often around 3,000-4,000 disposals), Koinly might aggregate your transactions while preserving short-term and long-term gains. If you still face issues, you might need to split your Koinly report into smaller files. Consult Koinly's support documentation for guidance on aggregation or splitting reports.
"My capital gains/losses seem wrong in TurboTax after import."
Go back to Koinly. The most common reason for this is incomplete or inaccurate data synced to Koinly. Ensure all exchanges and wallets are connected, and all transfers and income events are correctly categorized. Check for "missing cost basis" warnings in Koinly.
10 Related FAQ Questions
How to ensure Koinly accurately tracks all my crypto transactions?
To ensure Koinly accurately tracks all your crypto transactions, you must connect every single exchange, wallet, and blockchain you've ever used. Utilize API keys for major exchanges and public addresses for wallets, and upload CSVs for any unsupported platforms. Regularly review and reconcile your transactions within Koinly to catch any missing or miscategorized entries.
How to categorize staking rewards and airdrops in Koinly for TurboTax?
In Koinly, staking rewards, airdrops, and mining income should be explicitly tagged as "Income" in the transaction history. This ensures they are included in your "Income Summary" on the Koinly Complete Tax Report, which you'll use to manually input total crypto income into TurboTax.
How to handle transfers between my own crypto wallets in Koinly?
Koinly usually auto-detects these, but always verify that transfers between your own wallets are correctly identified as "Transfers" and not as taxable "sells" or "withdrawals." This prevents unintended capital gains or losses from being reported.
How to fix "missing cost basis" issues in Koinly before exporting to TurboTax?
To fix "missing cost basis" issues in Koinly, you'll need to manually enter the original acquisition details for the affected assets. This typically involves specifying the date, amount, and cost in your base currency for the crypto received. This often occurs when assets are transferred from platforms not synced with Koinly.
How to download the correct Koinly report for TurboTax?
From your Koinly tax reports page, you need to download the "TurboTax Export (Gain/Loss)" CSV file. For reporting income, also download the "Complete Tax Report" (PDF) and refer to its "Income Summary" section.
How to import the Koinly CSV into TurboTax Online?
In TurboTax Online, navigate to "Wages & Income" > "Investments and Savings". When prompted to enter sales, choose "Enter a different way", then "Cryptocurrency", and finally "Upload it from my computer." Select "Other" for the service name, enter "Koinly," choose "Gain/Loss Report or Form 1099-B" for CSV type, and then upload your Koinly CSV.
How to report crypto income separately in TurboTax?
To report crypto income in TurboTax, go to "Wages & Income" > "Less Common Income" > "Miscellaneous Income (1099-A, 1099-C)" > "Other Reportable Income." Select "Yes" to "Any other taxable income?", provide a description (e.g., "Crypto Staking Income"), and enter the total income amount from your Koinly Complete Tax Report's "Income Summary."
How to reconcile Koinly and TurboTax totals after import?
After importing, compare the capital gain/loss totals in TurboTax with the "Capital Gains Summary" in your Koinly Complete Tax Report. For income, compare the entered amount in TurboTax's "Other Reportable Income" with Koinly's "Income Summary." Small rounding differences are acceptable.
How to handle a large number of crypto transactions that exceed TurboTax's import limit?
If your Koinly TurboTax Export file has too many lines (e.g., over 3,000-4,000), Koinly may automatically aggregate your transactions. If issues persist, you might need to manually split the Koinly CSV file into smaller, separate files and import them one by one into TurboTax, or consult Koinly's support for specific guidance on large reports.
How to address discrepancies between Koinly and TurboTax after import?
If you notice significant discrepancies, first verify the accuracy and completeness of your data in Koinly. Check for missing transactions, incorrect categorizations, and missing cost basis. Regenerate the reports in Koinly and attempt the import again. If the issue persists, review TurboTax's specific error messages or consider consulting a tax professional specializing in crypto.
