If youve traded cryptocurrency, chances are that youve lost a fair amount of hairnot to mention sleeptrying to calculate your obligations. Some hodlers only need to report a few trades per year, but if youre moving large amounts of cryptocurrency, it might take some professional-level software to keep track of all those gainz.
The cryptocurrency tax software solutions on the market today come in different flavors, depending on your needs. Some are pure tax reporting tools, whereas others offer accounting services or portfolio tracking. Some also provide additional features such as support for small businesses or individuals who earn a living from trading.
When choosing a provider, some things to consider are:
If youre making less than around 1,000 transactions annually, you can opt for one of the lower cost plans. The same applies for portfolio value the higher the value of your portfolio, the more youll pay.
Lower-cost plans tend to offer integration with fewer exchanges and wallets. If youve been transacting over multiple exchanges and wallets, youll need to go for a higher cost plan. Furthermore, not all exchanges and wallets are integrated by all providers.
Some providers will allow you to connect to the exchange or wallet API, whereas others will require you to extract a CSV file for upload to the cryptocurrency tax software.
The most basic plans will simply produce the necessary IRS-compatible reports. Some of the more comprehensive offerings will track your asset portfolio, or offer enterprise-grade support for businesses accepting or making payments in cryptocurrencies.
With all this in mind, which providers offer the best package to suit your needs? This list covers a number of the major providers but isnt intended to be exhaustive:
BearTax is a simple and inexpensive cryptocurrency tax software, ideal for newcomers or the most casual investors. It offers a basic plan for only $0.99 which provides a tax report covering up to 20 transactions across any number of exchanges. Even the next plan, for up to 200 transactions, is only $29.99.
The software connects via API to a broad range of exchanges. It doesnt calculate taxes for margin or derivative trading, and it doesnt offer any portfolio tracking, so it may not be suitable for more frequent or advanced traders.
TokenTax is a decent all-rounder but the most basic plan at $65 per year only integrates with Coinbase and Binance. For power traders taking the highest package, it also offers services including assistance with IRS audits.
Unlike many other cryptocurrency tax software providers, TokenTax offers a premium service that can produce a full tax filing, including your crypto taxes. It also offers a planning service to help tax-optimize your portfolio, and can handle calculations on derivatives trades. Furthermore, TokenTax offers support if youre an employee earning in crypto, or for special situation such as if youve been the victim of a hack.
ZenLedger also offers additional features beyond pure tax reporting, such as support for ICOs and airdrops. However, it comes at an even higher price point the starter package is $149 per year for up to 500 transactions with up to $50k asset value. Unlike many others on this list, features on ZenLedger are standard across all packages, so youll only pay more for a bigger portfolio value and/or transaction volume.
Cointracker isnt just a tax reporting solution. It actively tracks your entire digital asset portfolio. This is likely to be very helpful if youve diversified across many wallets and exchanges, as it means you dont need to collect all of your holdings into one place come tax season.
Prices start from $49 for up to 100 transactions annually and go up to $999 for 15,000 transactions. In contrast with many other cryptocurrency tax software providers, Cointracker is international, offering reporting for UK, Canada, and Australia.
Bittax is the only cryptocurrency tax software weve seen thats based on blockchain technology. According to the website, it can trace an entire history of user cryptocurrency transactions from the moment the trader entered the markets, and even flag where transaction history appears to be incomplete.
Forward tax planning enables you to optimize your positions for maximum potential savings. Theres no pricing currently available on the website, but you can submit a request via their contact form for a free estimate of your tax obligations. This may be useful if youve received an IRS letter but believe youve paid your taxes correctly.
CryptoTrader.Tax provides many similar features as others mentioned on this list. The company emphasizes a user-experience first approach and uses an intuitive 5-step process for completing a tax report.
CryptoTrader.Tax supports more than 25 of the largest cryptocurrency exchanges and has partnered up with TurboTax to allow their users to import their cryptocurrency tax data into the TurboTax platform. Prices start at $49 and increase depending on the volume of trades you made during any given year.
Users can sign up and import all their data for free. Payment is only required once you want to download your tax report. David Kemmerer, the co-founder of the company, has also contributed some interesting articles on crypto taxes to Crypto Briefing.
Node40 started life as a service offering master node hosting but once they started accepting payment in cryptos, the founders realized they had no software to easily calculate their crypto tax obligations, so they designed their own.
Now, Node40 offers perhaps one of the best plans for new or novice traders using a single exchange or wallet, as you can import up to 1500 transactions completely free of charge. The next level up starts from $75. The company also offers a package for tax professionals. Given that many tax accountants still arent familiar with the tax rules on crypto assets, this service is useful for helping to bridge the gap between the existing tax world and crypto-assets.
HappyTax is providing a similar service. The company also operates Cryptotaxacademy to educate tax professionals in the game. It isnt a software provider but a full-service crypto tax preparation company. This may be a preferable option for those with more complex portfolios, as it allows you to be completely hands-off. The company can support crypto taxes as a standalone offering or as part of a full tax return service, which covers your other obligations as well.
If youve been unlucky enough to receive one of the recent IRS letters, then any of these services will also help you in retroactively calculating your tax obligations for previous years. Although its true that the IRS has created a cloud of uncertainty through a lack of clear guidance around the taxation of digital assets, using a cryptocurrency tax software solution can at least take some of the reporting burden off your shoulders.
See more here:
- What to Know About Billions' Cryptocurrency Drama If You Know Nothing About Cryptocurrency - Vulture - June 1st, 2020
- Will Shopifys New Cryptocurrency Partnership Widen Its Moat? - Motley Fool - June 1st, 2020
- Meet Theta Fuel, the cryptocurrency that catches world's attention - Nairametrics - June 1st, 2020
- Bitcoin founder may have just moved nearly $400,000 in untouched cryptocurrency - The Independent - June 1st, 2020
- Bitcoins $100K Probability Speculation or Economic Theory Backed? - Finance Magnates - June 1st, 2020
- Bitcoin hodl waves indicate 60% of the cryptocurrency is being hoarded analysts suggest a bull run could be - Business Insider India - June 1st, 2020
- Everything to Know about the Emergence of Prepaid Cryptocurrency Debit Cards: - PaymentsJournal - June 1st, 2020
- bitFlyer Europe and Quazard Partner to Bring First Ever Trading Competition to Botwars Ultimate Trading - Business Wire - June 1st, 2020
- Africa's young population and the drive for cryptocurrency - Techpoint.ng - June 1st, 2020
- Kraken CEO: Bitcoin (BTC) Would Be Worth $1,000,000,000,000 If the Masses Knew the Power of Cryptocurrency - The Daily Hodl - June 1st, 2020
- Cryptocurrency Cardano increased by 15% - The Times Hub - June 1st, 2020
- Calibras Rebrand to Novi: An Effort to Create Distance from Facebook? - Finance Magnates - June 1st, 2020
- Cryptocurrency Market Update: Bitcoin bleeding as the market gets ready for CME futures expiration - FXStreet - June 1st, 2020
- SA investors fear cryptocurrency CEO accused of stealing millions could be on the run - The Citizen - June 1st, 2020
- Cryptocurrency Definition - May 24th, 2020
- What is Cryptocurrency: [Everything You Need To Know!] - May 24th, 2020
- As Bitcoin Struggles, This Tiny Cryptocurrency Has Soared A Massive 230% - Forbes - May 24th, 2020
- Why Have Cryptocurrency Payments Failed to Take Off So Far? - Cointelegraph - May 24th, 2020
- Cryptocurrency and COVID-19: Bitcoins Path to a Safe Haven - Cointelegraph - May 24th, 2020
- Is 2020 the year to invest in cryptocurrency? - About Manchester - May 24th, 2020
- Bitcoin prices slip amid speculation that a block of the cryptocurrency possibly linked to creator Satoshi Nakamoto just changed hands - MarketWatch - May 24th, 2020
- RenBTC Quietly Goes Live in Latest Bid to Bring Bitcoin Into Ethereum - CoinDesk - CoinDesk - May 24th, 2020
- Analysis on Impact of COVID-19- Cryptocurrency Mining Hardware Market 2020-2024 | Rising Popularity Of Mining Pools to Boost Growth | Technavio -... - May 24th, 2020
- Learn how to invest in the stock market and cryptocurrency - New York Post - May 24th, 2020
- Fears missing ISIS millions are hidden in cryptocurrency ready for use as war chest - The National - May 24th, 2020
- Iran to Apply Currency Smuggling Laws to Cryptocurrency Transactions - Coin Idol - May 24th, 2020
- Taxation on the Cryptocurrency - Live Bitcoin News - May 24th, 2020
- Reddit CEO: Bitcoin Is Here to Stay Because of Wall Street Involvement - Bitcoinist - May 24th, 2020
- This Minor Cryptocurrency Is On Track To Smash Bitcoin In 2020 - Forbes - May 17th, 2020
- The Global Digital Asset & Cryptocurrency Association in Chicago wants to be the one to regulate digital currencies - Crain's Chicago Business - May 17th, 2020
- Telegram shuts down its cryptocurrency operation - The Verge - May 17th, 2020
- Bitcoin investors are bracing for a key technical event here's what you need to know - CNBC - May 17th, 2020
- Explainer: Understanding cryptocurrency trading in the region - Gulf Business News - May 17th, 2020
- How Investors Are Presented With Bitcoin: 'A New Decentralized Monetary Asset, Akin to Gold' - Bitcoin News - May 17th, 2020
- FATF: How Will the Guidelines Affect Canadas Crypto Industry? - Finance Magnates - May 17th, 2020
- Thailand Sticks by its Cryptocurrency Commitment - The Phuket News - May 17th, 2020
- Man charged over cryptocurrency investment fraud - The Star Online - May 17th, 2020
- Cryptocurrency and Blockchain Technology Software Market Projected to Witness Vigorous Expansion by 2020-2027: Intel Corporation, Microsoft... - May 17th, 2020
- Bitcoin and cryptocurrency markets: Where next? - FXStreet - May 17th, 2020
- Cryptocurrency Market News: Bitcoin fails to hit 10K but could make another push - FXStreet - May 17th, 2020
- Cryptocurrency Market Research Report 2020 By Size, Share, Trends, Analysis and Forecast to 2026 - Cole of Duty - May 17th, 2020
- Cryptocurrency Market Capitalizations | CoinMarketCap - May 9th, 2020
- Bitcoin Tops $10,000 First Time Since February, Before Halving - Bloomberg - May 9th, 2020
- Cryptocurrency market jumps by over $13 billion driven by bitcoin as major technical event approaches - CNBC - May 9th, 2020
- All Facts and Figure of Cryptocurrency is Clear as Real - AMBCrypto - May 9th, 2020
- PiixPay Allows Customers to Conveniently Use Cryptocurrency to Handle Bills and Recurring Payments - CardRates.com - May 9th, 2020
- Bitcoin (BTC) Remains a Widely-Used Cryptocurrency for Dark Web Transactions, a New Report Claims - Crowdfund Insider - May 9th, 2020
- Bitcoin's halving might see a large influx of investors wanting a piece of the cryptocurrency market - Mashable SE Asia - May 9th, 2020
- The IRS Wants to Know About Your Cryptocurrency Transactions - Interesting Engineering - May 9th, 2020
- Can heightened cryptocurrency regulations be a major threat to smaller exchanges? - AMBCrypto English - May 9th, 2020
- CRYPTOCURRENCY MARKET TRENDS ANALYSIS, TOP MANUFACTURERS, SHARES, GROWTH OPPORTUNITIES AND FORECAST TO 2027 3w Market News Reports - 3rd Watch News - May 9th, 2020
- Cryptocurrency Market Update: Bitcoin, Ethereum and Ripple have a bullish start to Saturday, following Fridays drop - FXStreet - May 9th, 2020
- Cryptocurrency market value jumps $35 billion in 24 hours led by a surge in bitcoin - CNBC - May 1st, 2020
- XRP Adoption: Two Banks Reveal Plans to Support Third-Largest Cryptocurrency - The Daily Hodl - May 1st, 2020
- Andreessen Horowitz Creates Second Cryptocurrency Fund With $515M Investment - Benzinga - May 1st, 2020
- US Congress Considering More Than Two Dozen Cryptocurrency and Blockchain Proposals - The Daily Hodl - May 1st, 2020
- Did This Norwegian Multimillionaire Invent a Cryptocurrency Ransom to Cover Up the Murder of His Wife? - Vanity Fair - May 1st, 2020
- Drawbacks of Cryptocurrency Exchanges - How Non-Custodial Services Are the Solution | Sponsored - Bitcoin News - May 1st, 2020
- Elon Musk Casually Drops the Bitcoin Bomb On Twitter, Once More - newsBTC - May 1st, 2020
- North Koreas Alleged $670M Cryptocurrency Stash in Question Amid Rumors of Kim Jong-Uns Death - BeInCrypto - May 1st, 2020
- $8.8 Trillion Traded in Cryptocurrency Spot and Futures Markets in Q1: Reports | Markets and Prices Bitcoin News - Bitcoin News - May 1st, 2020
- Wyoming: World's first to welcome cryptocurrency banks | Current Edition - Wyoming Business Report - May 1st, 2020
- The Impact of Cryptocurrency on Gaming in 2020 - Coindoo - May 1st, 2020
- Crypto Leaders on COVID-19: Join us for a Free Live Webinar Monday, May 4th - Finance Magnates - May 1st, 2020
- Brave integrates Binances crypto widget - Decrypt - May 1st, 2020
- Cryptocurrency Definition - Investopedia - April 30th, 2020
- Cryptocurrency Market Update: Bitcoin whales claims rally to $9,500 is a pump and dump movie - FXStreet - April 30th, 2020
- Circuit Breakers Could Be Coming to CryptoBut Will they Be Effective? - Finance Magnates - April 30th, 2020
- Kraken Expands Trading Pairs to 155 with New Conversions - Finance Magnates - April 30th, 2020
- Ethereum Near Levels That Sent Price 25% Down in 2019 - newsBTC - April 30th, 2020
- Cryptocurrency Accounting Firm Launches Library of Legal and Tax Advice - Cointelegraph - March 28th, 2020
- Lukka debuts resource library on all things cryptocurrency - Accounting Today - March 28th, 2020
- Binance Reveals the Secret Behind Its Cryptocurrency Futures Success - Cointelegraph - March 28th, 2020
- 5 Ways to Earn Cryptocurrency In 2020 - MENAFN.COM - March 28th, 2020
- Why this cryptocurrency just surged 16% on news of a key Binance partnership - CryptoSlate - March 28th, 2020
- What Will $6 Trillion in Monetary Expansion Do To Cryptocurrency? (Opinion) - CryptoPotato - March 28th, 2020
- How to identify when a cryptocurrency is about to skyrocket? | The Home of Altcoins: All About Crypto, Bitcoin & Altcoins - Coinlist - March 28th, 2020
- XRP Is Up 12% and It Seems to Be Aiming for Higher Highs - Crypto Briefing - March 28th, 2020
- Cryptocurrency Market Update: Dash and Monero edge above Bitcoin to lead a remarkable recovery - FXStreet - March 28th, 2020
- Chinas Cryptocurrency Is Closer Than Expected, Already Working On Legislation - CryptoPotato - March 28th, 2020