TraderTax calculator: what it does, what it costs, where it stops

What it does

Inputs are platform (Kalshi, Polymarket US, Polymarket offshore, Robinhood Events or other), market type, net profit or loss after fees, optional gross winnings and losses, trade count, other trading income, federal bracket from 12% to 37%, and state.

Short-term capital gain goes on Form 8949 and Schedule D, nets against other capital gains, and allows the $3,000 annual loss deduction with carryforward. Section 1256 uses Form 6781 for 60% long-term and 40% short-term treatment; the page calls this aggressive and notes practitioners often recommend a Form 8275 disclosure. Gambling treatment puts gross winnings into income and caps deductible losses at the lesser of 90% of losses or total winnings, itemizers only, no carryforward.

• Example at 24% bracket: Section 1256 $1,860 (18.6%), short-term capital $2,400 (24%), gambling itemizer with 90% cap $2,880 (28.8%), gambling standard deduction $7,200 (72%)
• Platform reporting notes: Kalshi issues 1099-INT, 1099-MISC and a narrow 1099-B but no comprehensive event contract 1099; offshore Polymarket issues no forms; Polymarket US had no confirmed 1099 policy as of July 2026; Robinhood's Event Contracts Annual Statement is explicitly not a tax form
• States: nine with no income tax; ten (Connecticut, Illinois, Indiana, Kansas, Louisiana, North Carolina, Ohio, Rhode Island, Vermont, Wisconsin) allow no gambling-loss deduction; New Jersey allows same-year netting without itemizing

Pricing

The calculator is free. TraderTax describes itself as a tax preparation referral platform, not a licensed tax firm, with services performed by independent CPAs and Enrolled Agents; its File It preparation starts at $597, with mark-to-market election and entity setup offered separately.

Venues and data

The platform selector changes the reporting notes, not the math. The page stamps its regulatory and tax status as of July 2026 and says it will update as guidance lands; the 90% cap's implementing regulations were in proposed form (REG-113229-25) at that time.

Where it falls short

It is an estimate, and the page says so: for estimation purposes only, not personalized advice. It does not import trades or produce a form.

The gambling column assumes the 90% cap applies as proposed. If the final regulations differ, the worst-case number moves.

Choosing a treatment is a filing position with audit consequences. The calculator shows the stakes; it cannot take the position for you.

Who should use it

Any US prediction market trader with a profitable year, before the conversation with a preparer, so the question of characterization is asked with numbers attached.