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Reconciliation

Matching records from different sources until they agree. In crypto tax, matching every transfer between wallets and exchanges so nothing is double counted and basis carries through.

What is Reconciliation?

Matching records from different sources until they agree. In crypto tax, matching every transfer between wallets and exchanges so nothing is double counted and basis carries through.

Why it matters on your return

Reconciliation is what separates an accurate crypto return from a software export. Unmatched transfers show up as fake sales at zero basis; matched ones carry basis to the sale. It is also the first thing an examiner asks for, so the method should be documented.

Example

You move 10 ETH from Coinbase to a hardware wallet, then to Kraken, then sell. Unreconciled, that can appear as three disposals. Reconciled, it is one purchase and one sale with the original basis.

Why does my software show gains when I only moved coins?

Because it could not match the withdrawal from one platform to the deposit on the other and treated the withdrawal as a sale. Manual matching fixes it.

Last reviewed September 10, 2026. Tax rules change; confirm current law before acting.

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