Coinbase & Turbo Tax Partner Up to Bring You Bitcoin Tax Returns?

It's the most fungible time of the year — tax season! And so come the headaches from the confusion of how to report your crypto to the IRS, but this year Coinbase & TurboTax are making it a bit simpler for all involved by enabling the ability for individuals to get their returns in either Bitcoin or other cryptocurrencies.

Beginning this year, TurboTax users can send any refund coming from the IRS or state government to their respective Coinbase account and have it exchanged into crypto.

This comes just a week after Coinbase announced the launch of its free tax center, which is said to make calculating and reporting crypto gains easier. As part of this deal, Coinbase is also giving away discounts on the TurboTax software.

These announcements all point towards a US government starved for profit looking for new forms of revenue. While Bitcoin was a considered a joke in most of the 2010s, today the first question asked when filling out your taxes is “do you own crypto”.

Owning crypto does not trigger a taxable event though, instead one has to pay when selling it returns a profit. Staking is the act of locking up one's crypto for a set period of time, earning yield on the assets.

As for trading profits, the amount on the bill will depend on how long you held on to the asset. Less than one year taxed as short-term capital gains, and over a year taxed as long-term capital gains.

Coinbase's partnership with TurboTax reflects how the once small exchange has become a corporate giant within the space of crypto, pushing them closer to a bank. This could benefit them most in the future as the government struggles to regulate the asset.