A prediction market CPA is a licensed accountant who handles tax reporting for event contract trading on platforms like Kalshi, Polymarket, and Robinhood. Because the IRS has not issued guidance on how these contracts are taxed, the work involves analyzing and documenting the appropriate tax treatment, rebuilding trade-level records the platforms do not provide, and preparing federal and state returns. COS Elite provides this service led by a licensed CPA and an IRS Enrolled Agent, with each engagement quoted as a fixed fee in writing before any work begins.
Prediction markets are new enough that the tax rules have not caught up. The full background lives in our guide to how prediction markets are taxed. The short version: three separate problems stack on top of each other, and a standard tax preparer is not set up to handle any of them.
Event contract profits could plausibly be taxed under Section 1256, as capital gains, as ordinary income, or as gambling winnings under Section 165(d). The IRS has not said which applies, and each one produces a different tax bill. The CPA needs to coordinate with the client to choose the treatment, support it, and put it in writing before your return is filed.
Kalshi issues 1099s covering rewards and interest, not your trading results. Polymarket sends nothing at all. Robinhood produces a custom annual statement that is not a 1099-B. None of these documents can be copied onto a tax return as-is, so accurate filing means rebuilding your actual profit and loss from raw trade data.
Prediction market reporting is new enough that IRS notices may not always align neatly with how your trading activity was actually reported. A mismatch between platform reporting, your tax return, and IRS records can trigger a notice requiring a detailed response. Responding correctly means understanding what the IRS is questioning, reconciling the underlying trading records, and providing documentation that supports the position taken on the return. A generic response or simple payment may not address the underlying issue.
Six concrete deliverables, from the first data pull to the filed return. Nothing on this list is optional, because skipping any one of them is how prediction market returns go wrong.
We evaluate tax treatment against your actual contracts and holding patterns, then document why the chosen treatment fits. You get the reasoning on paper, not just a number on a form.
Exchange exports, on-chain records, and platform statements get merged into one clean ledger of every position, settlement, and fee. This is the same reconciliation work our team does for crypto portfolios with thousands of transactions.
Funding a trading account with digital assets such as BTC or USDC is itself a taxable disposal, and most traders miss it. We capture the gain or loss on every crypto deposit and withdrawal in addition to the contract trades.
The complete return, prepared and filed electronically, including the proper reporting of your prediction market activity at both the federal and state levels.
For larger accounts, we prepare a standalone memo laying out the treatment, the authority it rests on, and the records supporting it. If your return is ever questioned, the defense already exists.
If the IRS sends a letter, you are not starting over with someone new. Our IRS notice response team handles the correspondence with your full trade history already in hand.
Ist year with COS and I feel like I made a good decision moving from my old CPA after 20 years. My crypto investments over the last few years complicated my returns but COS has a special team to work on this. They were able to reach back and capture losses that I thought were already taken care of. Ended up with a refund which is rare for me. Btw, we are a retired couple that appreciate the young smart team at COS.
Very professional, thorough and responsive. These folks have deep knowledge in all areas of taxes. I will be coming back next year!
Great communication and strategic mindset. Leanne and Garret walked me through every question I had, during a complicated tax year. Absolutely took the edge off!
I highly recommend this firm for their technical expertise and streamlined communication. They possess a deep understanding of complex tax codes and financial regulations, delivering results with high precision. What sets them apart is their commitment to efficiency and clarity. Rather than overwhelming clients with dense jargon, they provide insights in a clear, succinct format that prioritizes actionable information. Their ability to distill complex data into a readable, professional structure is invaluable for anyone who values their time and expects top-tier accuracy.
I got scammed to a fake crypto platform and lost a huge amount of money. A traditional accountant wasn’t able to help me until I found COS elite in reddit. Very knowledgeable, helpful and easy to contact. I appreciate what they have done for us.
Comprehensive tax and crypto accounting from a personable, professional, organized group. Highly recommend. They exceeded my expectations. In addition to traditional tax reconciliation they are also able to reconcile crypto transactions which can be a nightmare going it alone. They offered year end advice for tax loss harvesting. I highly recommend COS Elite.
I am so fortunate to have found Garrett, the head CPA of the COS Elite. After leaving my previous CPA, I was amazed by the level of service he provided. After my first meeting in the beginning of April, during the peak of a busy tax season, he managed to finalize my returns in under a week. He handled my transaction as a new client seamlessly, answering all my questions promptly usually by next day. Furthermore, his expertise in Crypto currency is unmatched. In my experience, he is the best CPA in San Diego for anyone trading with Crypto trading and losses. I strongly recommend this firm for anyone looking for a talented and experienced CPA.
Highly recommend Garrett and Leanne at COS Elite. They are both very friendly and provide a fast and quality service.
My husband and I were extremely pleased with the personal attention we received from COSElite tax service. They stayed in touch with us throughout the entire process of submitting information, having our questions answered, and assisting us with computer operations. We always felt supported. Their communication was clear and they were quick to respond. Thank you for a smooth tax tax year and we look forward to continuing to work with you in the future.
Garrett and Leanne were great to work with. Very responsive. Questions were answered quickly. Highly recommend.
I came to them several years behind on my crypto tax reporting, with transactions spread across multiple wallets and accounts, including some I had honestly forgotten about. They were able to go through everything in detail, reconcile it properly, and help get my reporting compliant and fully up to date. Before working with them, I had reached out to more than 10 CPAs, tax attorneys, and crypto tax specialists. Out of everyone I spoke with, they stood out for both their professionalism and competitive pricing. What impressed me most was the attention to detail. They took the time to account for every transaction and wallet instead of rushing through the process or giving me a broad estimate. Special thanks to Garrett for answering all of my questions, explaining things clearly, and working with me throughout the entire process. He was patient, responsive, and made a complicated situation much easier to deal with. If you’re behind on crypto taxes or have a complicated transaction history, I’d highly recommend them.
This is my first year working with Garret’s team, and I have to say I’m very happy with their quality and delivery. Two things that stand out about their firm compared to other CPAs: 1) Their word is their bond. They told me they would charge XYZ, and at the end of the project, they did exactly that. Unlike many other firms in this space that deceptively add bogus bonus charges or surprise you with prices that are completely divorced from reality. Their transparency is refreshing. 2) The other thing I enjoyed about working with this group is that they don’t force clients into using data-harvesting proprietary software that locks you in, sells your data, and leaves you vulnerable to phishing attacks. Their tech stack is lean, and they show you the actual work they’ve done instead of hiding behind some esoteric, vague trap. Honestly, I’m happy with them and would recommend them without hesitation.
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Pick your starting point. Both paths put you on Garrett’s calendar directly. No assistants, no pre-screeners.
Direct access to Garrett. He’ll work with you as a team, every step of the way.
Most firms in this space stop at Kalshi and Polymarket. Traders do not. If you hold positions on a platform below, we already know what its statements leave out.
The largest regulated event contract exchange in the US. Kalshi issues 1099s for rewards and interest but not for your trading profit and loss, and its trade exports price contracts in cents, a unit mismatch that quietly corrupts spreadsheets. We rebuild true P&L from the raw fills. Read the Kalshi taxes guide.
Trades settle in USDC on Polygon and no 1099 is issued, but every position is still reportable, and so is the crypto used to fund it. We reconstruct complete histories from on-chain wallet data. Read the Polymarket taxes guide.
Robinhood reports this activity on a nonstandard Event Contracts Annual Statement, not a 1099-B, and the figures cannot go on a return without translation. We map that statement line by line to the treatment your return actually uses.
Interactive Brokers routes event contracts through its ForecastEx exchange, with incentive coupons that have their own income character. We handle the contracts and the coupons together.
The long-running political market operates under a distinct structure with its own fee model and withdrawal mechanics. Legacy PredictIt accounts often carry years of unreconciled history, and we rebuild it.
Sports event contracts from a crypto exchange mix two reporting regimes in one account. We separate the contract activity from the crypto activity and report each correctly.
As fantasy operators add prediction market products, the tax character of each product line differs. We track which bucket every dollar came from.
On-chain prediction and perpetual markets with no reporting at all. Everything comes from chain data, which is exactly the reconstruction work our reconciliation team does daily.
Coinbase routes event contracts through Kalshi’s regulated exchange, so your trades carry the same reporting gap: no 1099 for trading profit and loss. The activity also sits alongside your crypto in one account, and we separate and report each correctly.
Trading somewhere newer than this list? New event contract venues launch constantly, and they all share the same underlying problem: incomplete records and an unsettled tax character. If we have not seen your platform yet, the reconciliation approach still applies, and we will tell you on the intake call exactly how we would handle it.
No scare tactics and no mystery. This is the same process every client goes through, whether you traded ten contracts on Kalshi or run a fund across five platforms. You always know which step you are on, what we found, and what happens next.
A short, complimentary call to review your platforms, volume, funding sources, and any prior filings. You leave knowing exactly what your situation involves and what it will cost, quoted as a fixed fee in writing.
Our Count On Sheep reconciliation team pulls exchange exports, platform statements, and on-chain records, then merges them into one verified ledger of every trade, settlement, deposit, and fee.
We analyze your contracts against the possible treatments, choose the one your facts support, and document the reasoning in writing. This decision drives everything else on the return.
Federal and state returns prepared from the reconciled ledger and the documented position, reviewed by both a CPA and an Enrolled Agent, then filed electronically.
Your records and position memo stay on file. If the IRS ever asks a question, we answer it with the documentation already built, and our notice response team steps in if needed.
Most firms in this niche will not tell you what anything costs until you are on a sales call. We publish our starting prices because you should be able to budget for this before you talk to anyone. Every engagement gets a fixed fee in writing before any work begins.
Complete federal and state return for a trader with a manageable trade history on one platform. Includes trade reconciliation, characterization analysis with written rationale, and electronic filing. Quoted as a fixed fee in writing after your intake call.
For traders with heavy transaction volume, multiple platforms, or on-chain activity to reconstruct. Adds wallet-level reconciliation, estimated payment calculations, and a written position memo for material accounts.
LLCs, funds, and six-figure-volume accounts get a scoped proposal covering entity-level reporting, ongoing advisory, and quarterly estimated tax planning. Priced in writing before work begins.
What moves the price is data, not drama: how many platforms you trade, whether on-chain reconstruction is needed, how many thousands of fills have to be reconciled, and whether an entity return is involved. A single Kalshi account with clean exports sits at the bottom of the range. Three platforms, two wallets, and a partnership return sit higher. Either way you see the number before we start, not after.
Not sure where you land? A $199 paid consultation maps your situation before you commit to anything.
We work with individual traders, entities, and funds across all 50 states. The common thread is real money on platforms whose paperwork was never designed for a tax return.
You trade event contracts weekly, your volume is well past hobby territory, and the forms your platform sent do not come close to describing what actually happened in your account. You need the real numbers rebuilt and a treatment you can stand behind.
You trade event contracts through Robinhood or IBKR ForecastTrader alongside stocks and options. The event contract statement looks nothing like the rest of your brokerage paperwork, and your regular preparer has never seen one before.
Your prediction market activity runs through USDC wallets, and it sits on top of an already complicated crypto tax picture. You need one team that can reconcile both worlds in the same engagement, not two firms pointing at each other.
You trade through an LLC or fund, or you already filed a return you suspect handled this wrong. Either way the stakes are higher now, and the fix starts with an honest review of what was reported and what should have been.
Filing this year is the floor. If prediction markets are a serious part of your income, the structure you trade under matters as much as the return itself.
Past a certain volume, trading through an LLC or S corporation can change your self-employment tax exposure, retirement contribution room, and liability picture. It is not right for everyone, and forming an entity for the wrong reasons creates cost without benefit. We run the numbers on your actual activity first. Explore entity structuring.
Trader tax status gets pitched as a cure-all, but its tests were built around securities traders and its benefits map unevenly onto event contracts. We tell you what it would and would not do for your situation before you chase it.
A large settlement in March creates a tax payment due long before next April. We calculate safe harbor payments so a winning year does not end with underpayment penalties stacked on top of the tax. See estimated tax planning.
Two licensed professionals touch every return, backed by the Count On Sheep reconciliation team that handles the data work. That team reconciles crypto and event contract activity every day of the year, which is why we can rebuild a Polymarket wallet or a Kalshi export in-house instead of outsourcing the hard part. Full backgrounds are on our about page.
California CPA License #133092
Garrett is a former Big Four CPA who has spent his career on digital assets and derivatives, from thousand-wallet DeFi reconciliations to positions on instruments the IRS has not written rules for yet. He personally signs off on the characterization analysis behind every prediction market return the firm files.
IRS Enrolled Agent #00167954-EA
Leanne is a federally licensed Enrolled Agent who reviews every return before it goes out and represents clients directly before the IRS. Her review is why a documented position on this page is not just a promise, it is a second licensed set of eyes on your filing.
Last reviewed September 23, 2026 by Garrett Taylor, CPA (California License #133092)
Straight answers to what traders actually ask us, including the one nobody else will put in writing: what it costs.
