My 1099-DA

[Max3721]

I received my 1099-DA from Coinbase. It consolidated all my transactions into one line. That part seems fine but when I enter it ito TurboTax it says "number of transactions" and says 1 even though there are 10 total. Do I need to individually enter them all off my own gain/loss report coinbase provides to me or is doing it as one consolidated transaction work since it was all the same coin (USDT).  Also, reading through your other questions about 1099-DA it says I need to upload my gain/loss form that Coinbase provides even though it is not a form that is sent to the IRS it is just a form they use internally to make it easier to track your gains/loss correctly. Is that correct?

[CesarJ]

Yes, you can summarize your investment transactions by separating them into short-term and long-term holdings based on the duration you owned the investments. This summary should be kept with your tax records in case the IRS requests it.

If you are unable to attach a PDF of your summarized transactions when e-filing your tax return, you must mail your statements along with Form 8453 to the following address three days after the return has been filed:

Internal Revenue Service

Attn: Shipping and Receiving, 0254

Receipt and Control Branch

Austin, TX 73344-0254

[Max3721]

Got it. So to clarify I need to upload my 1099-DA form into TurboTax AND whatever supporting documents I have for those transactions (aka the gain/loss report I have on Coinbase that I filled out).

also, my 1099-DA has no dates, will that be an issue?

[CesarJ]

Dates for your transactions in Form 1099-DA should appear in boxes 1e and 1d. If this isn't the case you should look at your statement from your crypto exchange provider to determine when these digital assets were acquired and disposed. 

@Max3721 

[Max3721]

I uploaded a copy of it. As you can see it doesn’t have any dates and just lists # of transactions as “10”. 

what I am trying to determine here is should I individually put each transaction into TurboTax with the cost basis and Proceeds? Then I would upload my 1099-DA along with my gain loss report that Coinbase had provided me? Because when I go to try to put everything in a TurboTax, it asks if I have more than four transactions and then it asks for me to put the total of all proceeds and the total cost space is instead of having me do it individually will that cause a problem with the IRS

[JamesG1]

Your IRS form 1099-DA reports gross proceeds, the digital asset, the number of units and the number of transactions.

The gain/loss report will allow you to allocate the $92,744.68 in gross proceeds to the ten transactions.  Each transaction will be assigned to long-term and short-term based upon the date of sale and date of purchase.

The gain/loss report will allow you to assign the cost basis of the investment sold for each of the ten transactions.

You would be able to report each of the ten transactions (which would total $92,744.68) into TurboTax using the one-by-one method.  Or you would be able to report the summary transactions (which would total $92,744.68) into TurboTax using the sales section totals. 

You may enter the summary information instead of each individual transaction.  Create a .PDF of the IRS form 1099-B and your analysis of the gain/loss report to upload into TurboTax Online.  Follow these steps.

1. Down the left side of the screen, click Federal.
2. Down the left side of the screen, click Wages & Income.
3. Click the down arrow to the right of Investments and Savings.
4. Click to the right of Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B).Click Add investments.
5. On the Save time and connect your financial accounts screen, select Enter a different way.
6. On the How do you want to add your docs? screen, select Type it in myself, then Continue.
7. At the screen OK, let's start with one investment type, select Digital Assets.  Click Continue.
8. At the screen Which bank or brokerage is on your 1099-DA, enter the information. Click Continue.
9. At the screen Did you get a 1099-DA from XXX?, select Yes.  Click Continue.
10. Answer the questions at the screen Tell us about the sales on your 1099-DA.
11. Do you have more than three sales, enter Yes.
12. Did you buy every investment listed, enter Yes.  Continue.
13. On the screen Now, choose how to enter your sales, select Sales section totals.  Select Continue.
14. At the screen Look for your sales on your 1099-DA, select Continue.
15. You will now be able to enter the total proceeds (sales) and cost basis, along with the sales category.
16. Report Short-term transaction with basis not reported to the IRS or Long-term transaction with basis not reported to the IRS.
17. Enter total proceeds,  total cost is $0, select I need to adjust my total cost basis.  
18. Enter the correct adjustment (not the cost basis) in the Total adjustments to gain.
19. Select code B (cost basis incorrect on form).
20. When finished, select Continue.
21. You can add additional sales totals by selecting the Add another sales total on the Review your sales section totals screen.
22. When completed, close the record and click Continue.
23. At the screen Now, we'll help you upload your 1099-B since the IRS requires a copy, browse and select your document.  Select Continue.
24. When you upload your document, your filing instructions will not show that anything needs to be mailed in, and no IRS form 8453 will be generated.

@Max3721 

[Max3721]

I did that but it did not calculate correctly. 

1. Enter total proceeds,  total cost is $0, select I need to adjust my total cost basis.  
2. Enter the correct adjustment (not the cost basis) in the Total adjustments to gain.
3. Select code B (cost basis incorrect on form).

^this is where the mess up happened. I put my cost basis as 0 and selected "I need to adjust my total cost basis" If i'm not putting my cost basis there I assumed I put my "net loss" which I did. But it still calculated it as a 0 cost basis minus the net loss. When I put my actual cost basis in that line it had the correct net loss so I am confused by your instructions. 

[JamesG1]

I absolutely understand.  When you are entering under the summary method, the adjustment codes mimic the workings of the IRS form 8949.  When working with the adjustment codes, it always seems like they work backwards.

That is why I entered the statement in item 2 as a warning.

     2.  Enter the correct adjustment (not the cost basis) in the Total adjustments to gain.

You may want to try out the one-by-one method of entering the IRS form 1099-DA to see whether it works more easily for you.  That method does not use the same kind of adjustment method as above.  You will report the actual cost basis under #9 below.

1. On the screen Now, choose how to enter your sales, select One by one.  Select Continue.
2. At the screen Next, we'll start entering sales from your 1099-DA, select Continue.
3. You will now be able to enter the sales information.  Report Short-term transaction with basis not reported to the IRS or Long-term transaction with basis not reported to the IRS.
4. Enter total proceeds,  total cost is $0, select The cost basis is incorrect or missing on my 1099-DA.  
5. Select I have other boxes on my 1099-DA to enter.
6. Enter information in box 1a and box 3a.
7. At the screen Let us know if any of these situations apply to this sale, you may select I paid sales expenses that aren't included in the sales proceeds reported on the form.
8. At the screen Let's find your cost basis, select Yes, I found my cost basis.
9. Enter the cost basis in Cost basis.  Click Continue.
10. Select Add another sale to add another entry.
11. When finished, select Continue.

There is a benefit of using the one-by-one method to record your 10 transaction that total the $92,744.  There is nothing to upload and nothing required to be mailed or sent to the IRS with your income tax return.  You just retain all of your records should, at some time down the road, a tax authority questions your computations.  Best to you.

@Max3721 

[Max3721]

Ok, everything makes sense EXCEPT this one part 

1. At the screen Let us know if any of these situations apply to this sale, you may select I paid sales expenses that aren't included in the sales proceeds reported on the form.

What would I put in that line for "Sales expenses not reported on Form 1099‑DA"? I see an option to leave it blank but just curious what I need to put there or if I even need to check that box?