Do You Have to Report Crypto Under $600?

Reporting Crypto Transactions Under $600

Cryptocurrency tax obligations can be confusing, especially for small transactions. Many wonder if crypto transactions under $600 need to be reported. The short answer: Yes—most taxable crypto events must be reported to the IRS, regardless of amount.

Key Points

All Taxable Crypto Events Must Be Reported Even if the transaction is under $600, gains, trades, and crypto-income must be disclosed.
The $600 Rule Applies Differently to Income Businesses must issue Form 1099 for payments in crypto ≥ $600, but taxpayers must report all crypto income.
Taxable Events Include:
- Selling crypto for fiat
- Trading one cryptocurrency for another
- Paying for goods or services with crypto
- Earning crypto via staking, mining, or airdrops
Non-Taxable Events:
- Simply holding crypto
- Transferring assets between your own wallets

Do You Need to Report Crypto Under $600?

Yes—any time you realize a gain or receive crypto as income, it’s a taxable event:

Crypto Sold for a Profit – Example: Buy $50 BTC, sell for $70 → report $20 gain.
Crypto-to-Crypto Trades – Example: Exchange $500 ETH for $490 SOL → report $10 loss.
Payments Received in Crypto – Example: Earn $100 in crypto for freelance work → report as ordinary income.

Understanding the $600 Rule

Business Reporting: Payers issue 1099s for crypto payments ≥ $600 in a calendar year.
Taxpayer Responsibility: Regardless of 1099 thresholds, all taxable crypto events must appear on your return.

Simplifying Crypto Tax Reporting

Use dedicated software to automate tracking and reporting:

Automated Transaction Tracking Integrates with exchanges and wallets.
Capital Gains Calculations Computes gains/losses for each trade.
Tax Report Generation Produces IRS-compliant forms and summaries.

Example tool: Awaken

FAQs

Do I need to report gains under $600? Yes—every gain, no matter how small, is reportable.
Is receiving $600 in crypto income taxable? Yes—crypto payments for goods or services count as income.
Do I file if I only held crypto? No—holding and internal transfers are non-taxable.
Can I avoid taxes by keeping transactions under $600? No—the IRS requires reporting of all taxable events.
How can I track small transactions? Use automated tools like Awaken for accurate, comprehensive records.

Conclusion

While the $600 threshold may affect 1099 reporting, every taxable cryptocurrency event—no matter the value—must be included on your tax return. Automated tracking and professional advice can help ensure full compliance.

Disclaimer: This information is for educational purposes only and does not constitute tax, legal, or financial advice. Consult a qualified professional for guidance specific to your situation.