Tax Forms FAQ for eToro USA
Table of Contents
What is a Form W9?
The IRS Form W-9, Request for Taxpayer Identification Number and Certification, is used to get the necessary information required from you in order to accurately report the payments made to you at the end of the year and know whether or not you are subject to backup withholding.
Why do I need to complete a Form W9?
eToro USA uses your name, address, and Social Security number or tax identification number provided on Form W-9 to complete tax forms you will need to file your taxes.
Will eToro be issuing 1099 tax forms to customers and to the IRS for cryptocurrency?
eToro USA issues only Form 1099-MISC to the IRS for our users. This form is used to report miscellaneous income.
As of the tax year 2021, eToro USA will no longer be issuing Form 1099-K’s to the IRS and our customers. Instead, we will be providing an informational 1099-K and 1099-B report that may be helpful for your tax filing needs.
What is the 1099-B and 1099-K report?
This consolidated report is for informational purposes only and is not an official IRS form. However, you may find this report useful for filing your taxes. Please consult with a tax advisor.
Both reports generally provide information about cryptoassest transactions handled by or through the institution in which you interacted (eToro in this case). The 1099-B report lists the proceeds and short-term gains and losses. The 1099-K report states the transactions broken down by month.
Please note that the calculations used in this report are based on a FIFO (First In First Out) cost basis method. In other words, the gain amount shown for each trade you closed is based on the value of the oldest lot(s) you had in your portfolio for that asset at the time you sold your position. If you wish to use another cost basis method, you should refer to your account activity report. We recommend you consult a tax professional.
For more information regarding 1099-Ks please visit: https://www.irs.gov/businesses/understanding-your-form-1099-k
For more information regarding 1099-Bs please visit: https://www.irs.gov/forms-pubs/about-form-1099-b
How will I receive the information I need to file my crypto taxes?
You can generate your 1099-B and 1099-K informational reports directly by logging in and accessing the reports in Account Settings under Cryptocurrency. The reports may take up to 3 business days to process. You will be notified via e-mail once the report is ready for download. We will communicate to users via e-mail when this crypto tax report generation feature is available.
How do I determine if I will be receiving a 1099-B and 1099-K report?
All US users who opened or closed at least 1 crypto position during the year 2021 will be eligible to receive the consolidated 1099-B and 1099-K informational report.
Do I need to file taxes for crypto this year?
eToro USA does not provide tax advice. Please consult your tax advisor to understand your tax responsibilities.
The IRS also provides a Virtual Currency (Cryptocurrency) FAQ section to answer questions on tax principles pertaining to cryptocurrency transactions.
What is Form 1099-MISC?
Form 1099-MISC is used to report miscellaneous income. Only customers who received $600 or more in compensation will receive this form.
Where can I find more information about Form 1099-MISC?
A copy of Form 1099-MISC will be sent to our users by mail to the address associated with your account. You may read more on this IRS Instructions for Form 1099-MISC website. The “Specific Instructions” on Page 1 provide valuable context with respect to eToro’s Form 1099-MISC reporting obligations.
We also kindly suggest that you consult with your tax advisor if you have questions about your individual tax obligations derived from your activity conducted on the eToro USA platform.
I misplaced my form 1099-MISC; can eToro USA send another copy?
Yes! We are happy to resend you the form 1099-MISC. Please submit a request through our contact form here. When searching through your mail, please recall that the original Form is delivered from a third-party provider, and not from eToro USA directly.
What tax documents will I receive for stocks and ETFs?
Our stock clearing broker APEX will be filing securities-related tax documents with the IRS. You can download a copy of the form under Tax Documents in account settings. For more information, please refer to the APEX FAQ.
How do I determine if I will be receiving a tax document?
All individuals will receive a Consolidated 1099 if they are United States citizens or legal residents and have had reportable tax activity. For dividends and interest, de minimis is $10; for fraction shares $20, for miscellaneous income $600.
Where can I find all my stocks and ETFs trading activity for all other tax reporting needs?
You can export (.pdf or .xls) your account statements and share them with your tax advisor to calculate the taxable income that you may need to include in your tax returns.
Still have questions? Please contact Customer Service.
Legal disclaimer: This material has been prepared for general informational purposes only. The information contained herein is not intended to provide, and should not be relied on for, tax advice. eToro USA does not offer tax advice, please consult with a tax-planning professional regarding your personal tax circumstances.