In trying to find out whether or not Bitmart does or does not report to the IRS, it is important to understand how governments, in this case in the United States, understand digital assets, with Bitcoin leading the way. For governments, digital assets are property. That means that they can come to be equated with other properties such as bonds, real estate, or stocks themselves.
If we consider the above, we can understand that, as property, a cryptocurrency is subject to capital gain and loss tax rules. In other words, people should be subject to tax reporting of the gains and losses obtained, all of which are tax-reporting due to their influence on taxes.
How to declare cryptocurrencies
The process of declaring cryptocurrencies for tax purposes is similar to that of any asset that impacts movable property. For example, you should calculate what you earn, what you lose, and what you enter, and do all this in the local currency. In this case, the US dollar.
This calculation is what you should take to your tax forms.
How to report taxes on Bitmart transactions
When you want to communicate the result of your operations with digital assets in Bitmar to the IRS, you should first know that the platform will not generate a tax report. That is, it will not directly provide a form you can submit to the tax agency.
However, it is possible to do so through an API. To do this, you download the transaction history by connecting through the API to your chosen digital asset tax management software.
In simpler terms, you can export the CSV file of your transactions on the platform and subsequently enter it into a cryptocurrency tax calculator. With this data, you can start filling in the corresponding part of the form.
It should also note that the platform will not provide a financial statement. Something you can try is to use the exported CSV file itself as a transaction history report. Actually, this transaction report is the closest thing to a financial statement that Bitmart provides you with.
Does Bitmart report to the IRS?
Theoretically, it should. As a platform operating in the United States, the IRS has the power to request customer information for tax compliance assurances. Although, as we already know, this environment still generates certain controversies, the truth is that it is important to value the voluntary declaration to avoid possible future problems.
It should be taken into account that even if there is no constant communication model between the platform and the tax authorities, the latter may intervene at any time with a request for information to which the medium is obliged to respond. Also, remember that this platform operates in more than 180 countries, so it may not only be subject to the demands of the IRS but, actually, to any tax authority of the countries in which it operates.
Something that may be confusing but that is worth knowing is that Bitmart does not offer a year-end statement for its customers. However, this does not exempt you from being able to perform data collection to make a stock report and pass it on to your taxes.
Why should I value declaring my crypto movements?
The reason is quite simple to understand: to an increasing extent, transactions with digital assets are in the crosshairs of the tax authorities, both in the United States and most countries around the world.
That means that, although there is no regulatory environment, there is an ever-tightening grip on tax reporting. What started as a kind of war on tax evasion, which could theoretically carry on through profits in digital assets, has become a systematic pressure on decentralized platforms to share sensitive information for tax declarations.
Therefore, we would be facing a situation where, even if eventually, in some cases, we could evade a tax return for a particular, fiscal year, the tax authorities could immediately request information at the slightest suspicion.
Despite the decentralization, these platforms keep the memory of all the transactions, that is, a history of all the movements that have been made. In an investigation, not only the activities of the specific year for which the claim is made would come to light, but also all the operations in the period requested by the tax authority.
Therefore, this could provoke a thorough investigation. Considering that it is done according to your tax obligations, you can suffer serious consequences that, depending on the amounts, are not only civil in the form of fines, but they can also be criminal.
In the end, the tax declaration is an exercise of fiscal solidarity for the authorities to allocate a large number of resources to avoid frauds or what are considered contrary elements by law to healthy compliance with citizen obligations.