Paybis vs. Coinbase: IRS Reporting Explained for Beginner Crypto Buyers

Updated December 19, 2025

Key Takeaways

Buying crypto isn’t a taxable event by itself. The IRS requires reporting on income (like staking rewards) and capital gains when you sell. Coinbase automatically issues Form 1099-MISC for rewards over $600 and Form 1099-DA starting in 2025 for sales. We provide downloadable CSV transaction history instead of automatic forms. For first-time buyers who purchase and hold Bitcoin, Paybis offers cleaner transaction records without trading form complexity. Both platforms are FinCEN-registered and comply with US tax law. Your first Paybis purchase includes zero service fees.

The only thing scarier than watching Bitcoin drop 10% overnight is opening a letter from the IRS. You bought $500 of Bitcoin and now you’re wondering: Did they tell the IRS? Do you owe taxes? Will you get audited?

Here’s the truth. Buying cryptocurrency isn’t a taxable event by itself. You can buy and hold crypto without paying taxes on it, even if the value increases. The IRS cares about selling, trading, earning rewards, or using crypto to buy something.

We built Paybis to make this simple. Verify your identity in under 15 minutes, buy Bitcoin with your credit card, and receive a clean transaction record without complex trading forms. When you need your tax history, download it in one click. No hidden spread affecting your cost basis. Just a straightforward receipt showing exactly what you paid. Your first purchase includes zero Paybis service fees.

This guide explains exactly what we report to tax authorities versus what Coinbase reports, and which approach makes tax season less painful for first-time buyers.

Do Crypto Exchanges Report to the IRS? The Short Answer

Yes, legitimate US-registered cryptocurrency platforms comply with IRS reporting requirements. But the type of reporting depends on the platform’s business model and your transaction activity.

We’re registered with FinCEN (MSB #31000175037491) and operate in 48 US states. Coinbase is publicly traded on Nasdaq, registered with FinCEN, and regulated as a public company. Federal law requires both platforms to comply with IRS reporting requirements.

The difference is in how we help you report:

• Coinbase operates as a custodial exchange and broker. They hold your crypto in custody and issue automatic tax forms (1099-MISC, 1099-DA) when you meet certain thresholds.
• Paybis primarily operates as a payment gateway where you buy crypto and send it directly to your wallet. We also offer a custodial Paybis Wallet. We provide transaction history exports but don’t issue automatic 1099 forms.

Think of it this way. Coinbase is like a brokerage account at Fidelity that sends you tax forms at year-end. Paybis is like using a payment processor to buy something online and keeping your own receipt.

Both models comply with federal law. The question is which one fits your needs.

Coinbase Tax Reporting: Automatic Forms for Active Traders

Coinbase issues multiple tax documents depending on your activity.

Form 1099-MISC and Income Reporting

If you earned more than $600 from staking rewards, Coinbase Earn, or interest, Coinbase sends you Form 1099-MISC by January 31. This reports ordinary income, just like a paycheck. Important: The IRS requires you to report ALL crypto income regardless of amount, the $600 threshold only determines whether Coinbase issues a form. Even if you earn less than $600, you still need to report it.

Form 1099-DA for Sales (2025 Forward)

Starting with 2025 transactions, Coinbase will issue Form 1099-DA for crypto sales and exchanges. The IRS finalized these rules on December 5, 2024. This form reports gross proceeds for 2025 transactions, and will include cost basis starting with 2026 transactions.

The challenge for beginners is Coinbase’s “spread.” When you use Coinbase’s simple buy/sell interface, they embed a markup (around 0.5%) into the price. This spread affects your cost basis, and many users don’t realize it until they reconcile their tax records.

Paybis Tax Reporting: Simple Data for Buy-and-hold Investors

We take a different approach because we serve a different purpose. Paybis is built for people who want to buy crypto quickly with a credit card and send it to their own wallet. No complex trading interfaces. No automatic staking. Just purchase and transfer.

Transaction History, Not Automatic Forms

We provide a downloadable CSV export of your transaction history from your account dashboard. Each transaction shows:

• Transaction ID
• Date and time
• Payment method (credit card, bank transfer, etc.)
• Amount sent (USD, EUR, etc.)
• Amount received (BTC, ETH, etc.)
• Service fee, processing fee, and network fee
• Total cost

This is everything you need to calculate your cost basis when you eventually sell. If you bought $500 worth of Bitcoin on Paybis on March 15 and paid $35 in fees, your cost basis is $535. When you sell that Bitcoin later for $700, you have a $165 capital gain to report on Form 8949.

Why We Don’t Issue 1099s

We don’t automatically issue Form 1099 to retail users. This makes sense given our business model. While we’re registered with FinCEN as a Money Services Business and operate both as a payment gateway and offer custodial services, our primary model focuses on quick purchases with immediate transfer to your wallet.

When you buy crypto on Paybis and send it to your external wallet, the transaction completes when we deliver the crypto to your wallet address. We don’t facilitate ongoing trading between users or offer staking programs that generate taxable income events.

The IRS’s new 1099-DA requirements apply to brokers who custody digital assets and facilitate sales. For transactions where you immediately transfer crypto to your own wallet, you’re responsible for maintaining records and reporting capital gains when you sell.

The Simplicity Advantage

Your Paybis transaction history takes 30 seconds to export and shows exactly what you need:

March 15, 2025: Bought 0.0082 BTC for $535 total (including fees)
June 22, 2025: Bought 0.0095 BTC for $620 total (including fees)
September 10, 2025: Bought 0.0071 BTC for $475 total (including fees)

If you held all year and didn’t sell, you have no capital gains to report. If you did sell, you have three simple entries for Form 8949 showing your purchase price and sale price.

“Paybis made it very simple and straightforward to get into the exciting world of crypto in a matter of minutes.” – Verified user review of Paybis

Paybis vs. Coinbase: The 2025 Tax Season Comparison

Here’s how the two platforms compare for tax reporting, fees, and ease of use:

Feature	Paybis	Coinbase
Automatic tax forms	No (CSV export only)	Yes (1099-MISC, 1099-DA)
$500 fee (card)	~$2.4 (0.49%)	~$20 (4%)
$500 fee (bank)	~$15-20 (3-4%)	~$7.45 (1.49%)
First purchase	$0 service fee	None
Verification time	Typically <15 minutes	Up to 24 hours
Transaction speed	Instant, (<1 minute)	Instant buy, 3-5 days for ACH
Best for taxes	Buy-and-hold with simple records	Active traders
Support availability	24/7 live chat	24/7 phone, chat, email

The $600 Rule: What Actually Triggers an IRS Report

The most misunderstood crypto tax rule is the “$600 threshold.” The $600 threshold applies to income, not purchases. If you earn more than $600 from staking rewards, mining, or other crypto income, the platform must report that income on Form 1099-MISC. However, the IRS requires you to report ALL staking income regardless of amount – the $600 only determines whether you receive a form.

What does NOT require a “Yes” answer on Form 1040:

• Purchasing digital assets using U.S. or other real currency, including through electronic platforms

What DOES trigger reporting:

• Selling or exchanging digital assets
• Receiving digital assets as payment for goods or services
• Receiving new digital assets from mining, staking, or airdrops
• Trading one digital asset for another

If you bought $500 of Bitcoin on Paybis and held it all year, you check “No” to the IRS digital asset question on Form 1040. You have no taxable gain to report until you sell.

Step-by-step: How to Export Your Transaction History

Paybis Transaction Export

We make downloading your transaction history straightforward:

1. Log into your Paybis account at paybis.com or through the mobile app
2. Navigate to the Transactions tab – find “Transactions” in the top navigation
3. Apply filters if needed – filter by date range (e.g., January 1, 2025 to December 31, 2025)
4. Click “Download in CSV” – this button appears at the top of the transactions list
5. The CSV downloads instantly and includes all transaction details: ID, payment method, amounts sent and received, exchange rate, fees, and total cost

Coinbase Transaction Export

Coinbase offers multiple options. Log into Coinbase, go to Settings > Tax Center, choose your report type (transaction history, gains/losses, or IRS forms), select your date range, and download the CSV or PDF.

Using Crypto Tax Software

Both platforms work with crypto tax software like Koinly, CoinTracker, and CoinLedger. These tools automatically categorize your transactions and generate IRS Form 8949. For first-time buyers with simple transaction histories (three purchases, no sales), crypto tax software might be overkill, you can report manually on Form 8949 in under 10 minutes.

Security and Compliance: Proof Paybis is Legitimate

Some first-time buyers worry: Is Paybis safe? Will my money disappear?

We’ve operated since 2014 with zero major hacks. We maintain several compliance registrations that prove we’re a legitimate, regulated business:

• US FinCEN registration (MSB #31000175037491)
• Canadian FINTRAC registration (M22061209)
• PCI DSS Level 1 compliance (highest payment processing certification)
• KYC/AML verification for all users

We store the majority of user funds in cold storage, as offline wallets are protected from online attacks. When you buy crypto, we hold it for minutes during transfer to your wallet, not indefinitely.

Coinbase is also legitimate (publicly-traded, Nasdaq: COIN) with 98% of funds in cold storage and crime insurance coverage up to $255 million. Both platforms take security seriously. The difference is we transfer crypto to your wallet immediately, so you control it.

Which Platform Makes Tax Season Easier?

Your best choice depends on your crypto activity level and comfort with record-keeping.

Choose Paybis if you:

• Buy crypto occasionally and hold it in your own wallet
• Want simple transaction records without trading complexity
• Value speed (verification typically <15 minutes vs. up to 24 hours)
• Need crypto today via instant card purchases
• Prefer transparent, upfront fees over hidden spreads
• Want to avoid navigating complex exchange interfaces
• Benefit from zero service fees on your first purchase

Choose Coinbase if you:

• Make frequent trades (buying BTC, converting to ETH, trading back)
• Earn staking rewards or use Coinbase Earn programs
• Want automatic tax forms delivered each February
• Trade crypto futures or need advanced chart tools

“I like how easy it is to buy crypto with my card and send it directly to my wallet. The interface is clear, transactions are fast, and support has been helpful whenever I had questions.” – Verified user review of Paybis

Tax Record-keeping Checklist for Crypto Buyers

Keep these records for at least three years after filing your tax return:

For purchases:

• Date and time of purchase
• Fiat amount spent (USD, EUR, etc.)
• Crypto amount received (BTC, ETH, etc.)
• All fees – service fee, processing fee, network fee
• Total cost basis – purchase price + all fees
• Wallet address where crypto was sent

For sales:

• Date and time of sale
• Crypto amount sold
• Fiat amount received
• Fees deducted from proceeds
• Net proceeds – sale price minus fees
• Original purchase date to determine short-term vs. long-term capital gains

Documentation to save:

• CSV exports from Paybis or Coinbase
• Confirmation emails for each transaction
• Fee breakdown screenshots
• 1099 forms received by January 31

Our transaction history export provides all purchase-related records automatically. For sales, you’ll need records from whichever platform or wallet you use to sell.

Ready to Buy Crypto with Simple Tax Records?

Zero Paybis service fees on your first purchase. All costs shown upfront before you confirm payment, no surprises when your card is charged.

Verify your identity in typically under 15 minutes, buy Bitcoin or other crypto with your credit card, and download your complete transaction history anytime you need it. If you have questions, 24/7 support with an average response time of 1-2 minutes.

Create your free Paybis account today and own crypto without the tax reporting complexity of a trading platform.

Key Terminology

Cost basis: The original purchase price of crypto plus all fees paid. This determines your capital gain or loss when you sell.

Form 1099-MISC: IRS form reporting income over $600 from sources like staking rewards. Remember, you must report all crypto income regardless of amount – the $600 only determines if you receive a form. Issued by exchanges like Coinbase by January 31.

Form 1099-DA: New IRS form (effective 2025) reporting gross proceeds from crypto sales. Brokers who custody assets issue this form for transactions starting January 1, 2025.

Custodial exchange: A platform like Coinbase that holds your crypto on your behalf. They control the private keys and act as a broker, triggering automatic tax reporting requirements.

Non-custodial service: A service model where you buy crypto and transfer it directly to your own wallet during the purchase. You control the private keys. The platform doesn’t custody assets long-term or issue broker tax forms.