Before December 31: A 2026 Tax Checklist for Kalshi and Polymarket Traders

Seven weeks are left in the 2026 tax year, and a few things can only be done before it ends. Selling a losing position moves the loss into 2026. Positions you still hold on December 31 need that day’s price. Records are easiest to get while you still use the apps. Here is the list, in the order we’d work through it.

1. Have you downloaded every app’s full history?

Get the full trade history from every app you used this year, including ones you stopped using. Kalshi has an export; for polymarket.com, your wallet address is the record. Kalshi sends no 1099 for trading profit and polymarket.com sends no tax forms, so nothing arrives in the mail to remind you. Where to find each history.

2. Which positions will still be open on December 31?

List them, with the date each one settles. Under capital gains, ordinary income and gambling, an open contract is taxed in the year it settles or you sell it. Under Section 1256 it is marked at its December 31 price, and the gain or loss to that point counts in 2026. How the December 31 mark works.

For Kalshi contracts, WagerMints reads each open position’s December 31 price from Kalshi’s public price history once the year has ended, so you don’t have to note them by hand. You can still type your own.

3. Do you want any losses in 2026?

Selling a losing position before December 31 puts the loss in 2026 under three of the four methods. Under Section 1256 the year-end mark counts it in 2026 either way. Two cautions:

• Buying the same contract right back may run into the wash sale rule. Whether it reaches event contracts is unsettled. What we know about wash sales.
• Under gambling, losses only help if you itemize, and from 2026 only 90% of them count, capped at your winnings.

4. Is the 100% loss deduction coming back?

Not yet. A fix that restores the full gambling loss deduction for 2026 cleared a House committee in September, and Rep. Dina Titus asked House leaders on November 5 to pass it before Congress leaves in December. As of November 12 it hadn’t had a vote. Plan on the 90% rule. Where the fix stands.

5. Have you counted rewards and interest?

Kalshi rewards, rebates and interest on your cash are ordinary income under every method, separate from your trades. Kalshi may send a 1099-INT for interest and a 1099-MISC for reward credits. For payments made in 2026, the 1099-MISC threshold is $2,000, so smaller rewards may come with no form, and they still count. Which forms Kalshi sends.

6. Did you trade perps?

Keep perps out of your event contract records. Single-stock perps are security futures, taxed like the stock with no 60/40 split. Index and crypto perps are still argued over. How stock perps are taxed.

7. Do you need an estimated payment?

Nothing is withheld from prediction market profits. If 2026 was a big year, you may owe estimated tax to avoid an underpayment penalty. The fourth-quarter payment for 2026 is due January 15, 2027.

8. Are earlier years in order?

If you traded in 2024 or 2025 and never reported it, fixing that before 2026 goes in is easier than after. How to handle past years.

How does WagerMints help before December 31?

Run your year now on WagerMints to see where you stand under all four federal methods, free. Run it again after December 31 for the final numbers, with Kalshi’s December 31 prices filled in. The prediction market tax guide explains how the methods differ.

Questions about year-end taxes

General information about US tax, not tax or legal advice.