@myraboenke thank you for the question. For background, your cost basis is the original price you paid for a coin/token, plus any transaction fees. You subtract your cost basis from the price you sold an asset for to calculate your capital gains or losses. You need to calculate your capital gains anytime you sell, swap, or spend crypto.
We want to avoid this tax treatment, which is if you don't know the historical price of your cryptocurrency, you may need to treat the cost basis of your crypto as $0. That means the entire proceeds of your sale should be treated as a capital gain.
See this on how I would go about it for all your trades:
- Start by downloading your complete transaction history from each wallet or exchange you used during the tax year.
- All this information must be combined into a single data set. Every buy, sell, trade, deposit, and transfer between accounts should be included.
- Next, you essentially need to trace the history of each token. You’ll need to find the following information for each taxable event:
- Cost Basis
- Acquisition Date
- Sales Proceeds
- Date of Sale
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