Tax Issues & Flags

TaxFormatter flags common tax concerns that need attention. This section explains what each flag means and how to handle it.

Common Issues We Detect

• Wash Sales - Selling at a loss and buying back within 30 days
• Staking Income - Reward tokens that count as taxable income
• Airdrops - Free tokens with fair market value at receipt
• DeFi Transactions - Complex protocols with tax implications
• Timestamp Issues - Dates that don't match exchange records

Each flag comes with a plain English explanation so you understand the tax implication.

Why Flags Matter

These aren't just warnings—they directly affect:

• How much tax you owe
• Which forms you need to file
• Potential audit risk
• Deductible losses

Understanding each flag is critical for accurate tax reporting.