calculating-crypto-taxes

Calculating Crypto Taxes

Overview

Calculate cryptocurrency tax obligations from transaction history. Supports FIFO, LIFO, and HIFO cost basis methods, identifies taxable events (trades, staking, airdrops), and generates Form 8949 compatible reports.

DISCLAIMER: This tool provides informational calculations only, not tax advice. Consult a qualified tax professional.

Prerequisites

• Transaction history exported as CSV from your exchanges (Coinbase, Binance, Kraken, etc.)
• Python 3.8+ installed
• Understanding of your tax jurisdiction's crypto rules

Instructions

1. Prepare transaction data by exporting CSV from each exchange:

   Exchange	Export Location
   Coinbase	Reports > Tax documents > Transaction history CSV
   Binance	Orders > Trade History > Export
   Kraken	History > Export
   Generic	See ${CLAUDE_SKILL_DIR}/references/exchange_formats.md for column mapping

2. Run basic tax calculation using FIFO (IRS default):

   python ${CLAUDE_SKILL_DIR}/scripts/tax_calculator.py --transactions your_trades.csv --year 2025  # 2025 = tax year
   

3. Compare cost basis methods to understand tax implications:

   python ${CLAUDE_SKILL_DIR}/scripts/tax_calculator.py --transactions trades.csv --compare-methods
   

   Methods: --method fifo (IRS default), --method lifo (Last In First Out), --method hifo (minimize gains)

4. Generate Form 8949 report as CSV:

   python ${CLAUDE_SKILL_DIR}/scripts/tax_calculator.py --transactions trades.csv --method fifo --year 2025 --output form_8949.csv --format csv  # 2025 = tax year
   

5. Handle income events (staking, airdrops, mining, DeFi yield):

   python ${CLAUDE_SKILL_DIR}/scripts/tax_calculator.py --transactions all_events.csv --income-report
   

6. Consolidate multi-exchange data into a unified report:

   python ${CLAUDE_SKILL_DIR}/scripts/tax_calculator.py --transactions coinbase.csv binance.csv kraken.csv --year 2025  # 2025 = tax year
   

Output

Reports include short-term and long-term capital gains/losses broken down by transaction, with proceeds, cost basis, and gain/loss per disposal. Summary shows total proceeds, total cost basis, net capital gain, and short/long-term split. Income report lists staking, airdrop, and mining income with fair market values.

See ${CLAUDE_SKILL_DIR}/references/implementation.md for detailed output format examples.

Error Handling

Error	Cause	Fix
Missing columns	CSV format mismatch	Verify format matches exchange template
Unknown transaction type	Unrecognized event category	Review and manually categorize
Insufficient lots	Missing buy transactions	Check for missing imports or transfers

Examples

Basic FIFO tax calculation - Standard IRS-default method for a single exchange:

python tax_calculator.py --transactions trades.csv --year 2025  # 2025 = tax year

HIFO to minimize gains - Highest-cost lots disposed first to reduce taxable gain:

python tax_calculator.py --transactions trades.csv --method hifo --year 2025  # 2025 = tax year

JSON output for processing - Machine-readable export for tax software integration:

python tax_calculator.py --transactions trades.csv --format json --output tax_data.json

Verbose with lot details - See which specific lots were matched to each disposal:

python tax_calculator.py --transactions trades.csv --verbose --show-lots

Resources

• IRS Virtual Currency Guidance: https://www.irs.gov/businesses/small-businesses-self-employed/virtual-currencies
• Form 8949 Instructions: https://www.irs.gov/instructions/i8949
• CoinGecko API for historical prices
• ${CLAUDE_SKILL_DIR}/references/implementation.md - Detailed output formats, configuration, advanced usage