Everything you need to file your Kalshi taxes, in order. Work top to bottom. It is educational, not tax advice, but it covers the steps people miss.
1
Export your full trade history from Kalshi
Download your complete fills/settlement CSV for the tax year. You need every closed position, not a summary, because there is no comprehensive 1099-B.
2
Convert the CSV from cents to dollars
Kalshi's export stores prices, amounts, and fees in cents. Divide the monetary columns by 100 (leave quantity alone). This is the single most common mistake.
3
Separate trading gains from rewards and interest
Your trading P&L is one bucket. Rewards, referrals, and bonuses (often on a 1099-MISC) and cash interest (1099-INT) are separate income. Do not blend them.
4
Net your realized gains and losses
Sum proceeds minus cost basis minus fees across every closed trade. This realized figure, not your account balance, is what you report.
5
Decide on a tax treatment with a professional
Event-contract gains may be ordinary income, Section 1256 (the 60/40 split), or gambling. It is unsettled and materially changes your bill. Pick a stance deliberately.
6
Match the treatment to the right forms
Section 1256 flows through Form 6781 to Schedule D; capital-style uses Form 8949 and Schedule D; ordinary lands on Schedule 1. An aggressive stance often pairs with a Form 8275 disclosure.
7
Check whether you owe quarterly estimates
If you expect to owe and aren't covered by withholding, you may owe quarterly estimated payments. Missing them can mean penalties.
8
Add your state tax
Most states tax the gain as ordinary income on top of federal, and generally don't recognize the Section 1256 split. Don't forget it.
9
Keep your records
Save the raw CSV, your converted worksheet, and any forms. If you take an aggressive position, documentation matters if you're ever asked.
Skip the spreadsheet
ContractTax does steps 1 through 8 automatically: it ingests your Kalshi CSV, handles the cents conversion, separates the buckets, and computes your tax under each treatment.