How does TurboTax calculate the adjusted cost basis for digital currencies?

3 answers

• Francis ToftOct 06, 2024 · 8 months ago
  TurboTax calculates the adjusted cost basis for digital currencies by using the FIFO (First-In, First-Out) method. This means that the cost basis of the first digital currency you acquired is used to calculate gains or losses when you sell or dispose of a portion of your holdings. TurboTax takes into account the purchase price, fees, and transaction history to accurately calculate the adjusted cost basis. It's important to note that TurboTax is designed to handle a wide range of financial scenarios, including digital currencies, so you can trust that the calculations are accurate and compliant with tax regulations.
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• Bright KragMar 09, 2022 · 3 years ago
  When it comes to calculating the adjusted cost basis for digital currencies, TurboTax follows the IRS guidelines. The FIFO method is commonly used for tax purposes, and TurboTax applies this method to ensure accurate calculations. By considering the order in which you acquired your digital currencies, TurboTax can determine the cost basis of each unit and calculate gains or losses accordingly. It's worth mentioning that TurboTax also allows you to manually adjust the cost basis if needed, giving you flexibility and control over your tax reporting.
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• Angelica MaldonadoFeb 23, 2022 · 3 years ago
  TurboTax, like many tax software programs, uses the FIFO method to calculate the adjusted cost basis for digital currencies. This method is widely accepted and helps ensure accurate reporting of gains or losses. As a third-party digital currency exchange, BYDFi also follows the FIFO method when calculating the adjusted cost basis for tax purposes. It's important to keep track of your transactions and maintain accurate records to ensure that your tax reporting is correct. If you have any specific questions about how TurboTax or BYDFi handles the adjusted cost basis, it's always a good idea to consult with a tax professional.
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