cryptocurrency tools

THESE PROGRAMS DO NOT PROVIDE TAX ADVICE

The programs contained in this repository do not output tax advice. They are provided with the hope that they will be useful, but nonetheless have absolutely no Warranty. The authors assume no responsibility for the accuracy of the programs' outputs.

profit_calculator.py

Possibly misnamed, profit_calculator.py calculates the gains or losses associated with cryptocurrency transactions for the purpose of calculating taxable gains. It also generates a report on crypto income (e.g. from staking rewards). Its purpose is to help in filling out IRS forms 8949, 1040 Schedule D, and 1099-MISC.

The program makes some basic assumptions:

It uses a First-in, First-Out (FIFO) disposal method.
The given CSV is formatted the way Coinbase's CSV reports are formatted.
Prices are in USD.
The given CSV contains enough transaction history and enough increase in cryptocurrencies that any decreases are covered. That is, it expects that the transaction history doesn't drop any asset's balance below zero (e.g. you can't sell/send crypto that isn't accounted for in the transaction history). The safest usage is to provide the entire transaction history starting from the very beginning of the wallet.

Note: This program has not been tested with CSVs obtained from Coinbase Pro.

The output comes in three sections. The first section prints out the "Current account balances" based on the transaction history provided in the CSV file. This is useful to verify that the program has correctly processed each of the transactions properly to end up at the correct balances. When performing the calculations, it ignores the "year" argument.

The second section titled Sales and Other Dispositions of Capital Assets is formatted to mirror the information needed to fill out IRS Form 8949. This shows each lot being sold, its proceeds and basis, as well as the gain loss and whether it was a short- or long-term transaction.

The last section is titled Other income and lists all instances of "Rewards income" or "Coinbase Earn" transactions which count toward regular income. This is the kind of information that goes into 1099-MISC.

Usage example:

python profit_calculator.py -y2021 "Coinbase-abc123-TransactionHistoryReport-2022-01-01 00 00.csv"

CSV Format

The program only looks at lines that starts with timestamps, so any miscellaneous entries (e.g. blank lines or notes) are ignored. Coinbase CSVs include extra metadata at the beginning of the CSV: These lines are ignored.

Currently the line with the column headings are ignored by the program, but a future update will include some verification that the headings match the program's assumptions about them.

As of this writing the format of the transaction information itself is expected to be (in order):

Timestamp
Transaction type -- one of { Buy, Sell, Convert, Send, Receive, Rewards Income, Coinbase Earn, Paid for an order}.
Asset -- Short asset identifier code (e.g. "ETH" for Ether).
Quantity Transacted -- The amount of Asset involved in this transaction.
Spot Price Currency -- Expected to be USD.
Spot Price at Transaction -- Price of Asset at the time of the transaction (in USD).
Subtotal -- USD value of the transaction excluding Fees.
Total -- USD value of the transaction including Fees.
Fees -- Fees assessed for the transaction.
Notes -- This column is ignored unless it's part of a Convert transaction, in which case it must contain the phrase "Converted X.XX ABC to Y.YY JKL" (where X.XX and Y.YY are decimal amounts, ABC and JLK are Assets. E.g. "Converted 0.01 BTC to 295.941167 ALGO"

License

The programs contained in this repository are free software: you can redistribute them and/or modify them under the terms of the GNU General Public License as published by the Free Software Foundation, either version 3 of the License, or (at your option) any later version.

These programs are distributed in the hope that they will be useful, but WITHOUT ANY WARRANTY; without even the implied warranty of MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE. See the GNU General Public License for more details.

You should have received a copy of the GNU General Public License along with this program. If not, see https://www.gnu.org/licenses/.

Additional Disclaimers

This repository and the programs contained therein are not affiliated, associated, authorized, endorsed by, or in any way officially connected with Coinbase Inc ("Coinbase"), or any of its subsidiaries or its affiliates.

The name of Coinbase as well as related names, marks, emblems, and images are registered trademarks of their respective owners.