Report your Crypto taxes & get ahead of Coinbase's Lies to the IRS. Anytime to transfer your Coinbase Crypto to an external address, Coinbase like an angry Ex mislabels that as a Sale to the IRS. The only way around this is to report your Crypto taxes every year so the IRS sees your correction.

This post is to help save people from ending up like this poor bastard, who now has a six figure lean on his assets and house thanks to Coinbase's false reporting: https://np.reddit.com/r/Bitcoin/comments/sh2dqc/beware_coinbase_caused_me_to_be_audited_by_the/

This is why I report and file my crypto taxes every year. I always have to get ahead of Coinbase and prove that my outgoing transfers were just transfers and not sales. Coinbase likes to label external withdrawals to outside wallets as sales, so it's always best to beat them at reporting those withdrawals as just transfers and not sales, otherwise you will not have a good time.

You don't want to fuck with the IRS. You've probably seen posts from others saying they have leans on their assets and income now thanks to these lies Coinbase makes. These kind of problems take years to correct, which can be years while your garnishes and assets not on cold storage wallets get claims to repay the fake owned taxes thanks to Coinbase's lies that label your transfers as sales.

It's a fucked up thing that hopefully gets fixed in the future with a class action lawsuit against Coinbase and other exchanges that do shitty things like this. Because they should allow us to label our transfers as transfers, and not leave a transfer as a liable event where the IRS think you profited money instead of just moved your money thanks to the lies of exchanges like Coinbase which punish you for taking your coins off their platforms through misreported tax shit like this.

Tip:

What I do is use an app like CoinTracker or Koinly, etc to API in all the information from the exchanges I use into 1 place. It takes hours after that to go in and correct every mislabeled transfer, and a lot of trial and error to figure out how the tax aggregator application your using works. Google helps where it can, but a lot of it is still new so trial and error helps you more where Google doesn't.

If you have less than 100 transactions then your taxes might be free in some crypto tax aggregators like CoinTracker, but if you have over 1000 transactions like myself then it will cost you something.

But, I always tell myself that it's better to spend the time correcting transfers and paying them for a correct tax form if need be, than to fight with the IRS for up to a year or more correcting the mistakes Coinbase and other platforms falsely report, all while having a lean against your income and assets that the IRS will be collecting until the errors are fully disputed and corrected.