How do I report the swap or exchange of one cryptocurrency token for another?

[uk05]

Voyager Digital, LLC went bankrupt within the last few years.

As part of their chapter 11 proceedings, they did the following:

1. Swapped / exchanged my 4.02 VGX tokens for USDC.

2. Then swapped / exchanged my USDC balance for USD (dollars).

How do I report this in TurboTax? I have the transaction details with token quantity, price per token, cost basis, etc but I cannot find any details reporting swapping / exchanging one crypto for another.

Thank you.

[AmyC · Accepted solution]

The swap consists of the "sale" of one for the purchase of another. You will need to report VGX as a sale under Investment Income. 

[uk05]

Thanks. That's what I just ended up doing.

When VGX -> USDC swap / exchange occurred, the acquire date of VGX tokens is the airdrop date from 2021 (which I already reported as income from tax year 2021) & the sell date is the swap / exchange date in 2023 when it was converted to USDC. The buy & sell cost basis' is the dollar value of the VGX tokens on those acquire & exchange dates. 

Likewise for the subsequent USDC -> USD swap / exchange, the acquire date is the same date as the aforementioned VGX -> USDC swap / exchange in 2023 & the sell date is also in 2023 per the transaction report. The buy & sell cost basis' is the dollar value of the USDC token on the above 2023 exchange & sell dates. 

Thus, two swaps / exchanges, so two sell transactions.

I'll mark this as closed.

Thank you.