Kalshi taxes

Kalshi taxes, trade by trade

Kalshi is a CFTC-regulated exchange, and its annual Profit and Loss statement reports a single net number. That number is hard to check and says nothing about which treatment applies. Connect a read-only API key and we rebuild every fill, fee and settlement into lots and per-market P&L.

Connect Kalshi

Create a read-only API key in Kalshi (Settings → API keys) and paste the key id and private key. Used for the import only, never stored.

Connect a read-only key

Never logged. Saved only if you choose to, encrypted at rest.

What makes Kalshi different

Section 1256 is on the table

Kalshi lists on a regulated exchange, which is why 60/40 treatment is discussed. It is unsettled; we show it next to the alternatives.

Yes and no are separate lots

Each side of each ticker is its own instrument, so a hedge does not silently net against a position.

Scalar and voided markets

Settlements use the published value per contract, so scalar and voided markets close at the right price.

Treatments

How Kalshi activity could be taxed

There is no IRS ruling for event contracts. We compute each option on your trades.

Capital asset

Form 8949 + Schedule D

Gains: Short-term at ordinary rates if held one year or less; long-term rates if held longer.
Losses: Offset capital gains, then up to $3,000 a year of ordinary income; the rest carries forward.
When it comes up: The common default for crypto-settled positions, including Polymarket outcome tokens held in your own wallet.

Section 1256 (60/40)

Form 6781

Gains: 60% long-term and 40% short-term, whatever the holding period. Open positions are marked to market on Dec 31.
Losses: Capped like capital losses, with an optional 3-year carryback against prior Section 1256 gains.
When it comes up: Only for contracts that qualify as regulated futures on a qualified exchange. Whether event contracts qualify is unsettled.

Other income

Schedule 1, line 8z

Gains: Net profit is ordinary income at your marginal rate.
Losses: A net loss generally cannot offset other income.
When it comes up: A conservative reading some preparers use for exchange-traded event contracts while guidance is missing.

Gambling

Schedule 1 + Schedule A

Gains: Every winning session is income, even if you lost overall.
Losses: Deductible only if you itemize, and from 2026 only 90% of losses, never more than winnings.
When it comes up: The least favorable outcome for most active traders, and the one to understand before you file.

Kalshi tax guides

All guides

Are Kalshi Losses Tax Deductible? Four Treatments, Worked Out

Can Kalshi losses be deducted? It depends on the treatment: capital, Section 1256, gambling (90% cap from 2026) or other income. Worked examples.

Kalshi 1099 Doesn't Match Your Numbers? How to Reconcile It

Your Kalshi 1099 or P&L statement doesn't match your own math? Here are the 7 usual causes, a reconciliation table, and what each form actually covers.

Kalshi Taxes and the 1099: What You Get and What to Report (2026)

Kalshi taxes explained: which 1099s Kalshi sends, why your trading profit isn't on them, how event contracts may be taxed, and worked examples for 2026.

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