With IRS new change coming to wallet based tracking… which will require FIFO or Specific identification methods per wallet starting Jan 1st 2025
is it possible to get cost basis per wallet? either as a full system option change or at least a full detailed report per wallet with cost basis for each token inside that wallet so make it easier to switch to Specific Identification method?
Hi @Rigsss
Other users have raised this here.
Our devs are working on this at the moment and a resolution will be introduced soon.
Thank you,
My last concern about my question is IRS Safe harbor where they will allow you set a reasonable cost basis for token I have left on per wallet basis by Dec, 31st, 2024 and there will be two options of using FIFO or the Specific identification methods after. so will need a way to lock all cost basis by the end of the ye
issue I’m seeing is switching to a FIFO as I know HIFO reduces Capital gain better. Will there be a way to switch to Specific identification methods. which means specifically marking which Token I am actually trading selling…etc to better control captain gains and lost.
Is there any update on this? Can you please confirm this feature will be complete by 1/1?
Hi @PizzaCat
Although I have no ETA, I can confirm that the devs are currently working on a way to handle the changes.
@Aria_Koinly Are there any updates from the devs on this feature? It is getting very close to 2025 when this requirement goes into effect.
Hi everyone,
Thanks for your patience.
Check out our newly released article on this matter:
Migrating to wallet-based cost tracking under new IRS guidance (USA only)
I hope that this clarifies the case for you.
Thank you @Aria_Koinly ! Just a heads up that this migration was not automatically created for me even though I have purchased numerous tax years.
I think the automatic migration will take place on Jan 1st.
It seems that FIFO is required starting in 2025. Why is Koinly migrating everyone to Lowest Cost-Biggest Wallet?
It is confusing but here’s my interpretation so please correct me if you find I’m wrong here. Here it goes. You are mixing up the unused cost basis allocation method with cost basis accounting method. The unused cost basis allocation method is either global or Specific Unit Allocation. Lowest cost to biggest wallet would be a global allocation method. Then, there are cost basis accounting method which are FIFO, LIFO, HIFO, etc.
By the way, the IRS does not require you to use the FIFO method but it is the default method if you didn’t elect that (or instruct any of these methods to crypto exchanges).
Hi everyone,
Starting January 1, 2025, Koinly will automatically migrate your account to wallet-based cost tracking to align with new IRS regulations. No action is needed from you on Koinly for this transition. By default, Koinly will apply the “Lowest cost to biggest wallet” method. This change only applies to transactions from January 1, 2025 onward, so your previous reports will remain unchanged.
For more details, check out our article: Migrating to Wallet-Based Cost Tracking Under New IRS Guidance (USA Only)
The article answers your possible questions in the FAQ section.
This is great. Thanks. Question… I’ve already been using wallet based tracking, so I think I’m good there. But I was using LIFO. What should I do? Migrate and then switch to FIFO? For any forms? The above article doesn’t cover this. Thanks.
Do you advise that I move all my crypto to my hardware wallet by Dec 31, and then re-distribute after Jan 1, to simplyfy things. Or is it better to distribute some of my crypto into a second account so that my hardware wallet stays the larger and oldest, and then I can easier sell and trade from the smaller account and and thus the higher cost basis?
Thanks for sharing! On the very bottom point " If a taxpayer does not use the method that they selected before Jan 1st, then they will not qualify for the safe harbor protection." Can I ask what this really means? The only option for migration is “Lowest Cost to Biggest Wallet” there. If I’m using FIFO before 2025, am I still be qualify the Safe Harbor? Thank you!
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