How to Use Koinly for Crypto Tax Reporting

Koinly is a cryptocurrency tax software that automates the tracking, calculation, and reporting of your gains and losses. By connecting your wallets and exchanges, Koinly turns messy transaction histories into clear tax reports ready for your accountant or tax authority. This guide walks through the entire process, from setting up your account to exporting your final report.

Setting Up Koinly for Crypto Tax Reporting

Before you can generate any reports, you need an account and a clear understanding of your tax jurisdiction. Koinly supports multiple countries and their specific tax rules, so choosing the right region from the start prevents errors later.

Creating Your Account

Go to Koinly.io and sign up with your email. During onboarding, Koinly asks for your country of residence and reporting currency. Select these carefully because they determine the tax rules applied — for example, the US uses FIFO (First In, First Out) by default, while the UK may use pooled averages. You can change these later, but starting correctly saves time.

Selecting Your Tax Method

Under Settings → Tax, you can choose your cost basis method (FIFO, LIFO, or Specific Identification) and your reporting date. Beginners should stick with FIFO unless they have a specific reason to use another method. Koinly also supports crypto‑to‑crypto trades, staking rewards, and airdrops, which you can categorize as income or capital gains depending on your local laws.

How Koinly Imports Your Crypto Tax Data

Koinly pulls transaction data from over 600 exchanges, wallets, and blockchains through three main methods: API integration, CSV upload, and manual entry. The most efficient way is API integration because it syncs automatically.

Connecting an Exchange via API

Most centralized exchanges (e.g., Binance, Coinbase, Kraken) offer an API key that Koinly can read. Follow these steps:

1. Log into your exchange account and navigate to the API section.
2. Create a new API key with read‑only permissions — never grant withdrawal or trading rights.
3. Copy the API key and secret into Koinly under Add Wallet → Exchange.
4. Koinly will fetch your entire trade history, including buys, sells, deposits, and withdrawals.

Uploading a CSV File

For wallets or DeFi platforms that don’t provide API access, you can upload a CSV file exported from the platform. Koinly provides a CSV template and a mapping tool that lets you assign columns (date, amount, fee, etc.). This method works well for hardware wallets like Ledger or for manual trades on DEXs.

Manual Entry

If you have a small number of transactions (e.g., a single airdrop or a forgotten NFT sale), you can enter them manually. Go to the Transactions tab and click “Add transaction.” Choose the type — Trade, Income, Expense, or Transfer — and fill in the details. Manual entries are useful for correcting discrepancies but should be minimal for large portfolios.

Reviewing and Categorizing Transactions in Koinly

After importing your data, Koinly displays every transaction in a dashboard. This step is critical because automatic categorization isn’t perfect. You need to review and adjust tags to ensure your tax report is accurate.

Checking for Missing Transactions

Koinly highlights orphan transactions — events where a deposit or withdrawal has no matching counterpart. For example, if you sent crypto from Coinbase to your wallet and only imported the withdrawal, Koinly will flag the missing deposit. Add the missing transaction or link the two using the “Merge” feature under the transaction detail panel.

Categorizing Income Types

Different crypto activities have different tax treatments. Koinly uses tags to classify each transaction. Below is a table of common tags and their typical tax implications:

Tag	Tax Treatment	Example
Mining	Taxed as ordinary income at receipt	Received rewards from a mining pool
Staking	Taxed as income when claimed	Earned staking rewards from a validator
Airdrop	Taxed as income at market value	Received tokens from a protocol giveaway
Gift / Donation	Usually not taxable (check local laws)	Sent crypto to a friend as a gift
Leveraged Trade	Capital gain/loss on closing position	Opened a long position with margin

You can bulk-edit tags by selecting multiple transactions and choosing a tag from the dropdown. For DeFi interactions like yield farming or liquidity provision, Koinly often auto-detects the tag, but verify each one.

Adding Cost Basis Information

For trades that involve multiple tokens, Koinly calculates the cost basis automatically using your chosen method. If a transaction shows “Unknown Cost Basis,” it means Koinly lacks price data for that token at the time of acquisition. You can manually enter the acquisition price by clicking the transaction and filling in the “Cost Basis” field. This situation often occurs with obscure altcoins that don’t have a reliable price feed.

Generating Your Crypto Tax Report with Koinly

Once all transactions are reviewed and correctly tagged, you can generate your tax report. Koinly offers several report types, but the most common is the Capital Gains Report, which summarizes realized gains and losses for the tax year.

Choosing the Right Report Period

Under Reports → Tax Reports, select the tax year you want to cover. For most users, this is the previous calendar year. Koinly also supports fiscal years for countries like the UK (April 6 to April 5).

Customizing Report Filters

You can filter by wallet, symbol, or even by a specific date range within the year. This is useful if you only want to report gains from a particular exchange or if you need to exclude a few transactions for a tax‑loss harvesting strategy. Koinly’s “Exclude from reports” checkbox lets you remove individual trades from the final PDF.

Previewing the Report

Click “Preview Report” to see a summary of your total realized gains, short‑term gains, long‑term gains, and total income. Short‑term gains are typically taxed at a higher rate than long‑term gains in many jurisdictions. Koinly clearly separates these categories so you can plan accordingly.

Exporting and Filing Your Tax Report

After previewing, you can download your report in multiple formats suitable for different tax systems.

Downloading the PDF Summary

The PDF report is a human‑readable document that includes your gain/loss summary, transaction details, and any notes. This is what you would give to your accountant or attach to your tax return.

Exporting CSV or Excel

For users who need to further manipulate their data (e.g., for form‑filling software), Koinly provides CSV and Excel exports. These contain every line item — date, amount, proceeds, cost basis, gain/loss — and can be imported into TurboTax, TaxBit, or other platforms.

Submitting to the Tax Authority

Some countries allow direct submission of tax reports. Koinly offers integrations with IRS‑friendly formats (like Form 8949 for the US) and HMRC‑friendly formats for the UK. Check your local tax authority’s guidelines and use the format they require.

Conclusion

Koinly simplifies the complex process of crypto tax reporting by importing, categorizing, and calculating your transactions automatically. By carefully reviewing your data, tagging income types correctly, and choosing the right cost‑basis method, you can ensure your report is accurate and ready for filing. Whether you are a casual trader or a DeFi power user, Koinly helps you stay compliant without the headache of manual spreadsheets.