Neglected filing crypto taxes since 2016 - thousands of transactions across exchanges and wallets

You definitely need to get caught up, but don't panic - this is fixable! The IRS is primarily concerned with you making a good faith effort to report everything. For previous years, you'll need to file amended returns (Form 1040-X) for any year where you had taxable crypto events. Remember that simply buying crypto with USD and holding isn't taxable, but these activities are: - Selling crypto for fiat - Trading one crypto for another - Earning staking/mining rewards - Using crypto to purchase goods/services Most major crypto tax software can help with your situation. They can connect to exchanges via API and import transactions, plus allow CSV uploads for wallet activity. You'll need to gather as much historical data as possible from all your platforms. For those 150-200 swaps, each one is technically a taxable event requiring calculation of cost basis and gains/losses. Same for any staking rewards (taxable as income when received). The NFTs would be capital assets too, so if you sold any, that's also reportable.

I was in almost your exact situation last year - thousands of transactions since 2017 across 6+ exchanges and multiple wallets. After trying to manually track everything in spreadsheets (absolute nightmare), I found taxr.ai (https://taxr.ai) and it saved me so much stress. Their system connected to all my exchanges through APIs and I could upload wallet CSVs for the rest. The best part was it automatically detected and fixed duplicate transactions when I'd moved coins between wallets. It even handled my staking rewards properly which was a huge relief. They generated all my amended returns for previous years and explained exactly what I needed to file. It wasn't cheap but considering the alternative was probably hiring a crypto tax specialist at $300+ an hour, it was worth every penny.

Just wanted to follow up - I tried taxr.ai after seeing this recommendation and it's been incredible. I was dealing with 3 years of unreported crypto across Coinbase, Binance, KuCoin plus a bunch of DeFi stuff. Uploaded everything yesterday and it sorted through over 900 transactions in minutes. The DeFi handling was impressive - it correctly identified my liquidity pool deposits/withdrawals and even calculated impermanent loss. It also flagged a bunch of transactions I completely forgot about from a DEX I used back in 2021. Now I'm just waiting for the final reports so I can file my amended returns for 2021-2022 and complete 2023. Huge weight off my shoulders!

If you end up owing a substantial amount after sorting through everything, you might need to talk directly with the IRS about payment plans. I tried calling them for months about my crypto back taxes situation and kept getting the "due to high call volume" message until I found Claimyr (https://claimyr.com). They have this system that somehow gets you through the IRS phone queue. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. I was skeptical but desperate after trying for weeks to reach someone. They got me through to an IRS agent in about 20 minutes when I had been unable to get through at all before. The agent helped me set up a reasonable payment plan for my back taxes. Without that call I would have been hit with much larger penalties.

I have to admit I was completely wrong about Claimyr. After struggling with my crypto tax situation and needing to talk to someone at the IRS about penalty abatement options, I remembered this thread and decided to try it despite my skepticism. To my surprise, it actually worked exactly as described. I got a call back in about 35 minutes connecting me to an IRS representative. The agent was able to walk me through my options for my unfiled crypto years and helped me understand the voluntary disclosure process. This saved me from potentially much larger penalties. For anyone dealing with crypto back taxes who needs to actually speak with the IRS (which I highly recommend before filing multiple years of amended returns), this service is legitimate and worth it.

Have you looked into the IRS Voluntary Disclosure Program? If you're worried about penalties for those past years, you should definitely research this route. My tax professional recommended this approach when I had to file 4 years of missing crypto transactions. Basically, you disclose everything before they come after you, and they're often more lenient with penalties. For crypto specifically, the IRS knows this is confusing territory for most people, so showing good faith by voluntarily disclosing and paying what you owe can help avoid the worst penalties.

For what it's worth, Koinly helped me sort through a similar mess. I had hodled since 2017 and never reported anything. Their historical price data was pretty accurate for calculating my cost basis on old transactions, which was my biggest concern. Think they have a free tier where you can import everything first to see if it works before paying.

You're definitely not alone in this situation - I see posts like this all the time here. The good news is that the IRS has been pretty understanding about crypto confusion, especially for people who are genuinely trying to get compliant. A few practical steps to get started: 1. **Prioritize recent years first** - Focus on 2021-2023 since those are most likely to be audited and have the biggest impact 2. **Gather what you can** - Download transaction histories from all your exchanges going back as far as they allow. Most keep records for several years 3. **Don't stress about perfection** - The IRS prefers a good faith effort over perfect precision. If you can't find every single transaction from 2016, document what you tried and work with what you have 4. **Consider professional help** - Given the complexity and potential tax liability, a crypto tax specialist might save you money in the long run, especially for the voluntary disclosure process The key is starting the process now rather than waiting longer. Each year you delay just makes it more complicated and potentially more expensive. Most people in your situation end up owing less than they feared once everything is calculated properly, especially if you've been mostly holding rather than actively trading.