With the year rapidly coming to a close, some people have already started preparing their tax returns.
Even though we’re still far away from any tax deadlines in some jurisdictions, I’m of the opinion that you’re better safe than sorry.
As such, I thought it would be a good time to discuss what cryptocurrency tax software is available on the market.
In this article, I will cover three pieces of accounting and tax software that can assist you with your crypto tax endeavours.
This list is not exhaustive, and there are of course a number of choices out there. You should always do your own research and choose the option that is best suited to your needs.
CryptoTrader.tax helps cryptocurrency traders calculate their capital gains/loss exposure in minutes. The simple interface makes it easy to import your trades and make sure that you’re not overpaying on your taxes.
The CryptoTrader.Tax platform focuses on the US market and currently supports over 20 direct connections to exchanges like Coinbase, Bittrex, Gemini, Binance, and Poloniex.
Users can also upload their trading data using CryptoTrader’s generic exchange template. After importing your trades, CryptoTrader will calculate your tax liability using a similar method to accountants across the industry.
Once the tax exposure has been calculated, users are provided easily exportable tax documents for filing, including IRS forms and a cryptocurrency income statement.
In addition, CryptoTrader creates an audit trail that details every single calculation used in your tax filing to work out your net cost basis and proceeds.
CoinTracker is a hybrid crypto asset tracker and tax reporting platform. The platform automatically syncs your asset balances and transactions from your exchange accounts or local wallets, providing up-to-date information about all of your cryptocurrency activities.
The interface displays a visualisation of all of the digital assets you own and the associated trading history.
Additionally, CoinTracker also provides a performance tracker, which gives you a clear picture of your crypto investment performance over time. CoinTracker works well with the US market as it also provides exportable IRS forms.
To date, CoinTracker has been a top performer in the crypto tax software market. It has over 100,000 wallets and exchanges connected and tracks over $10 billion in transaction volume.
While researching this article, Blox.io was probably the software I enjoyed looking at the most. In terms of its user interface, something I personally value quite a lot (given the amount of work it requires), Blox was my favourite.
In addition to auto-tracking, financial tools, and a pretty neat dashboard, Blox includes features like an enterprise solution and a smart tool for the automated and accurate calculation of cryptocurrency profit and loss.
The list of clients using Blox is quite impressive and proves how serious the company is. Big names such as eToro, Polkadot, Ox, Ziliqa, and Nexo are all using Blox to calculate crypto taxes.
To conclude, I believe it’s important to start considering using specific cryptocurrency tax software if you’re managing large sums.
One of the most important aspects of trading and investing is to never miss tax day and to keep your books up to date.