Losses, records and reporting: claiming what you're owed
The reporting side. How losses reduce what you owe, what records you actually need, and why reporting matters even in a year when no tax is due.
General information, not tax advice. Crypto tax rules vary by country and change over time, check your local rules or a qualified adviser before filing.
The short version
Losses are an asset, not just bad news: in most systems a realised loss offsets capital gains and can be carried forward, but usually only if you report it. That is the theme here, reporting and owing are different things, and skipping a return in a loss year can forfeit a deduction you were entitled to.
Good records are what make all of it defensible. With exchanges increasingly reporting to tax authorities, an accurate self-report, backed by a reconciled history, is far cheaper than a later correction.
New to the vocabulary? The crypto tax glossary defines every term in plain English, and the other FAQ categories cover the rest.
Questions
FAQ
Usually. Realised capital losses can typically be set against realised capital gains, reducing your net taxable gain, and many countries let you carry unused losses forward to future years. Rules on what a loss can offset, and anti-avoidance rules like wash-sale or bed-and-breakfasting, vary by country.
Keep a full history of every acquisition and disposal: dates, amounts, the asset, the value in your local currency, fees, and the counterparty or wallet. You'll also want records of income events (staking, airdrops). Connecting your exchanges and wallets to CryptaTax rebuilds this history automatically, including transfers between your own wallets.
Usually yes. Even when no tax is due, most tax authorities expect you to report disposals, and reporting a loss is how you claim it to offset future or current gains. Skipping it can mean forfeiting a valuable deduction and leaving a gap that doesn't match the data exchanges report about you.
Exchanges increasingly report to tax authorities, and frameworks like CARF and the US 1099-DA are expanding that reporting. Unreported gains can lead to back taxes, interest and penalties. Reporting accurately, even when little or no tax is due, is far cheaper than a later correction.
There's no gain to tax on assets you lost, and in some jurisdictions a loss of this kind can be claimed to offset gains, but the rules are strict and often require evidence, and many countries don't allow it at all. Treatment of theft and scams is one of the most jurisdiction-specific areas, so document everything and check locally.
It depends on your country. Some treat gifting crypto as a disposal at market value (realising a gain for the giver), while others don't tax gifts below certain thresholds; donations to registered charities may be relieved. Receiving a gift can also carry its own basis rules. Because this varies widely, check your local rules or an adviser.