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Get your taxes done using TurboTax
Not Tax Advice:
Ditto @barry13 the @rudyrabbit proposed formula, yields the wrong units (and wayyy to low of a cost basis amount/transaction), which is what tripped me up last week. Turbotax was of course no help. Also concur, that if one has a small total # of proceeds then probably worth it to bite the bullet and put $0.00 for the basis on each transaction. For a large # of shares purchased then it maybe worth the pain.
Here's a quick detailed example for a single transaction.
The wealthfront spreadsheet and Grayscale pdfs are a reasonable places to start for a single transaction (see links below) but gets complicated and time consuming beyond that.
The formula for cost basis factor*total_purchase_price_of_shares for the single transaction summed for the entire year (in the weathfront spreadsheet) seems to yield the correct result for the cost basis for each transaction (at least IMO).
For example. Here's a simple single transaction case of 20 shares of GBTC bought on 1/7/21 for a total cost/share of $46.00 ((Share purchase price + (My brokerage Commission/# of shares purchased)) and NOT sold for entire year of 2021. Note this would result in a net unrealized loss on these shares at the end of 2021).
20 shares of GBTC bought on 1/7/21 for a total cost of $920.0 and not sold for all of 2021.
Here is what the entry would look like in the wealthfront spreadsheet:
"Date Sold" Cell C15 -> 2/4/22
"Quantity" Cell D15 -> 20
"Date Acquired" Cell E15 -> 1/17/21
"Cost Basis" Cell F15 -> $920.0
NOTE: the "Date Sold" cell entry of 2/4/22 tricks the wealthfront spreadsheet to compute the proceeds and cost basis columns for the entire year (from purchase price to end of year)
This gives me a total payout of $17.90 (Cell F68 in the "DO NOT EDIT - GBTC Calculator" Worksheet) with a cost Basis $18.38 (Cell G68 in the "DO NOT EDIT - GBTC Calculator" Worksheet). Note I copy pasted the the full 8 digit "Proceeds Rate" column for each date as the wealthfront sheet was off by a little bit (8th digit) from the grayscale website tax forms. Thus you would get slightly different #'s (def < $1.00 difference in the #'s I display here).
In this case the Cost Basis ($18.38) is higher than the payout ($17.90) and one is taking a net loss on these payouts, thus it should reduce the overall tax liability. I did something similar for ETHE and definately got similar #'s and a net gain on these but the key takeaway is that the overall the cost basis was much higher than the formula by rudyrabbit. I'm hoping this makes sense to everybody.
Additionally, I'm thinking to delete all the individual transactions and just put one lump sum transaction with the cost basis and payout for sake of time but idk if that will cause issues going fwd. Any thoughts from anyone on this thread on this approach??
If you have multiple transactions throughout the year, then it gets even more complicated (especially there are buys and sells). It took me a couple hours, but I've finally got a spreadsheet cobbled up for this.
Now to create these type of spreadsheets for ETHE, LTCN,etc for multiple transactions..... sighhh == aneurysm..
Hopefully, this helps folks out.
Useful links
GBTC Trust Tax document:
Wealth front Available Spreadsheets:
