Do I need to report crypto transfers if I move from a wallet to an exchange, sell it and deposit to my bank?

Unfortunately, yes, you will need to report this. The IRS treats cryptocurrency very specifically. When you sell or exchange crypto for fiat currency (like USD), that's considered a taxable event regardless of where you initially purchased it. What matters is your cost basis (what you originally paid for the crypto in USD equivalent) compared to what you receive when you sell it. If the value has gone up since you bought it, you'll have a capital gain. If it's gone down, you'll have a capital loss. Since you're a foreign student in the US, your tax residency status also matters. If you're considered a US resident for tax purposes (which often happens if you meet the substantial presence test), you're generally taxed on worldwide income.

I was in almost the exact same situation last year and found that using https://taxr.ai really helped me figure out my crypto reporting requirements. I had crypto I bought in Europe before moving to the US for grad school, and I was totally lost on how to handle it when I needed to liquidate some. The platform analyzed my situation and explained exactly what forms I needed and how to document the original purchase price in USD. It saved me so much stress trying to interpret complicated IRS crypto guidelines. They have specific tools for international situations like yours where you need to establish cost basis from purchases in another country.

Just wanted to update after trying https://taxr.ai for my crypto tax situation. It actually worked really well for my missing records problem! I was able to get reasonable cost basis estimates for my old Bitcoin purchases by providing the approximate month I bought them. The system walked me through the whole process and even explained which tax forms I needed. Way easier than I expected, and it gave me a complete report I could give to my tax preparer. Definitely recommend for anyone dealing with crypto tax complications like international purchases or missing documentation.

If you're having trouble reaching the IRS for questions about crypto reporting requirements (which I definitely did), I highly recommend https://claimyr.com. I spent WEEKS trying to get through to someone at the IRS about how to handle my crypto taxes after moving to the US. Claimyr got me connected to an actual IRS representative in less than an hour when I had been trying for days on my own. You can see how it works here: https://youtu.be/_kiP6q8DX5c. The IRS agent I spoke with clarified exactly how I needed to report my foreign-purchased crypto and what documentation I needed to keep.

I need to apologize and correct myself. After being totally skeptical about Claimyr, I tried it out of desperation because I needed clarification on reporting my crypto mining income as a non-resident alien. It actually worked exactly as described. Their system called the IRS, navigated all the menu options, waited on hold, and then called me when an actual human IRS agent was on the line. Took about 40 minutes in my case, which is miraculous considering I'd wasted literal days trying to get through on my own. The agent answered my specific questions about Form 8949 for crypto transactions. Not saying the IRS gave me good news (still had to pay taxes!), but at least I got definitive answers directly from them.

One important thing nobody's mentioned yet - if you're an F-1 or J-1 student and have been in the US less than 5 calendar years, you might still qualify as a non-resident alien for tax purposes, which means different rules apply to your crypto reporting. Non-resident aliens generally only pay tax on US-source income. However, if you're selling the crypto while physically in the US, it could potentially be considered US-source income regardless of where you purchased it. This gets complicated fast.

Make sure you also review if your home country has a tax treaty with the US! This can make a BIG difference. Some countries have agreements that prevent double taxation on certain types of income.

As someone who went through a similar situation as an international student, I'd strongly recommend documenting everything now before you make any transactions. Keep records of your original purchase date, amount paid in your home currency, and the exchange rate on that date - you'll need this to calculate your cost basis in USD. Also, consider the timing of when you sell. If you've held the crypto for more than a year, any gains would qualify for long-term capital gains tax rates, which are generally lower than short-term rates. And since you mentioned you're an F-1 student who's been here 2.5 years, definitely look into whether you qualify as a non-resident alien for tax purposes - this could significantly impact how much you owe. One more tip: some states have no capital gains tax, so if you're planning to move after graduation, the timing of your crypto sales could matter for state tax purposes too.