In 2022 Robinhood allowed to deposit crypto to Robinhood app. I received email from them that form 1099 will be available on Feb 15, 2023. They say when they cannot determine cost basis like deposited from another wallet, only gross proceeds will be reported. Does it mean 100% of my crypto proceeds will be taxed? Very unfair. How to correct cost basis for that form in Turbotax?
If it is not supplied, you will have to enter the basis manually.
To enter manually in Turbotax? I expect it will be supplied for those assets bought on Robinhood, but will not be supplied for deposited crypto. So, I can alter data from Robinhood crypto 1099 form in Turbotax, if it is incomplete, right?
Yes, and I believe you will have to do so (probably will not be easy, though).
Thank you for the answers! If anybody would have a guidance/advice/video on how to properly deal with crypto reporting in Turbotax, would be much appreciated. I mined some relatively small amount of crypto in 2022 and plan to use Turbotax Self Employed for mining revenues and want to avoid paying taxes twice for selling those coins on Robinhood.
Also, is there any threshold for revenues under which I am not obliged to report self-employed revenues?
If you don’t post the bases of the coins, you will be taxed on 100% of the proceeds, even if you had a loss.
Your basis (also known as your “cost basis”) is the amount you spent to acquire the virtual currency, including fees, commissions and other acquisition costs in U.S. dollars. Your adjusted basis is your basis increased by certain expenditures and decreased by certain deductions or credits in U.S. dollars. For more information on basis, see Publication 551, Basis of Assets.
If you know the date you acquired the coins, this may help Historical Cryptocurrency Prices