ZenLedger is another excellent solution for handling both your or your clients' taxes on cryptocurrency. This solution can help you cover all types of reports you might encounter. It covers all the tax forms you might need to file or have on hand. It can help you handle the math required to report capital gains and losses. It allows you to see all your transactions from multiple wallets and exchanges within a single easy-to-understand spreadsheet.
ZenLedger is one of those providers that can help you with your non-crypto taxes as well. It has prepared plans for handling both types of taxes for you. This solution also offers a professional tax suite. It is an excellent choice for professionals looking to provide crypto tax services to their clients.
If you are unsure whether ZenLedger is the right solution for you, you can take advantage of its free plan, covering up to 25 transactions. When combined, these discounts are making it one of the most affordable crypto accounting software on this list. Within its free plan, you can add unlimited transactions and prepare your tax reports for free - provided that you have been using the services of one of more than companies within the TaxBit Network Partners program.
For a fraction of the prices found with other providers on this list, Bitcoin Taxes can import your trades from almost every popular exchange, calculate your capital gains, and export the reports in the format you need to file your taxes. Its website is also very comprehensive, answering all your questions upfront. It offers multi-year support, covers many currencies, and has useful packages for tax accountants and professionals.
When we say affordable pricing, we mean you can cover up to 20 transactions for free. Apart from the number of transactions, there are no other limitations to the free plan, unlike with many other providers. CoinTracker is famous portfolio-tracking software for numerous cryptocurrencies, but it also has all the features you need to turn that portfolio tracking into a tax report.
You can connect with your accounts from almost all exchanges and wallets to it, export your transaction history or capital gains for your tax software or accountant, and even see your tax summary per each wallet. Probably the best part of this software is its mobile app, excellently rated on both Google Play and the App Store. You can start tracking and prepping your taxes with CoinTracker for free, but only for 25 transactions.
There is also the Ultimate plan, which includes unlimited transactions and additional features, for a custom quote. As mentioned before - every action you take in the crypto world is still taxable in the eyes of the IRS, and you should have your documents in order. Your activity is tracked to help you submit accurate reports and avoid overpaying your taxes or paying any penalties. A good crypto tax software should be able to integrate with all of the popular exchanges and wallets to allow for automatic data input.
If you are a professional trader, manually keeping track of all your transactions can be troublesome. You need to keep track not only of prices but also dates, the amount of coins or tokens you traded, and the length of time you kept those in your wallet. It is also important that the software you choose can be used in your country, as the taxes differ depending on where you live.
The app you choose should follow taxation standards in your country. Even if you are not a professional trader and have a smaller amount of transactions per year, these tools can save you hours in adding all of your trades manually. Once these data aggregators have all the data they need, they can calculate the crypto taxes you should pay.
To do this seamlessly, you should look for the best crypto tax calculator available in terms of accuracy. Most tax software should also be able to present you with pre-filled and ready-to-download paperwork you can file. It should help you with more than just the infamous IRS Form You ought to be able to rely on it for international taxes, your audit track, and even for reporting your taxes on cryptocurrency gains and losses.
The best cryptocurrency tax software will also have excellent dashboards for tracking your transaction history. From there, it should have you covered in terms of tax - loss harvesting and other features intended to simplify your tax handling. Some of these software solutions will recognize transactions between your wallets and save you from paying the taxes on them.
Others will automatically remove duplicate transactions from your forms. Having all these features available saves time for tax professionals, too. Some of these solutions offer software for tax professionals to help them manage taxes on crypto gains for their clients. Other solutions include non- crypto tax handling - a perfect solution for those looking to handle all their taxes in one place.
However, it might be safer to go with a dedicated, traditional tax software solution if you need that. Other essential aspects of each software handling taxes especially in the crypto world are its reputation and security. You want to make sure you are working with the best tax software for crypto, one that is reliable and secure.
You don't want it to mess up your reports and have to pay penalties once the IRS compares your report to those submitted by crypto exchanges or, even worse, get accused of tax evasion. Checking crypto tax software reviews first-hand is an excellent idea that could help you determine whether or not it is the right software to go with.
The best way to test crypto tax software is by getting hands-on experience with a free trial. Many providers on this list offer try-before-you-buy schemes or have basic plans that cost very little. First-hand experience with a piece of software is the key to finding the right tool to help you handle your taxes on cryptocurrency.
Lastly, there is also the question of the value you get for the price you pay. It would be best to know how many transactions you make per tax year, as these pricing tiers are mainly based on that number. You should also check whether a piece of software will scale well if you make more transactions in the upcoming year.
With some solutions, different tiers unlock different features as well. However, not all features are worth the extra price. Yes, crypto to crypto trades is taxed. Since you are typically either earning or losing on these sales, you need to keep track of them and report them to the IRS through form If you deliberately avoid reporting cryptocurrency on taxes, you could get audited by the IRS.
This is a daunting process that could lead to you paying a significant amount in penalties or worse. It is, of course, advisable to report your cryptocurrency income and trading as accurately as possible and pay the tax on cryptocurrency to avoid potentially harsh consequences.
It would help to keep track of the cost basis, gains, sales prices, and any other relevant information. The best crypto tax software on the market keeps track of all this data for you and presents you with accurate and downloadable tax reports you can file with the IRS. On the other hand, selling crypto for fiat is taxable.
Buying crypto with another crypto is also a taxable event, and so is using cryptocurrency to buy goods and services. More categories More. Reviewed by fortunly. Follow us on YouTube Explaining complex financial terms in a way that the average Joe and Jane can understand. Advertiser Disclosure. Fortunly's Guide.
This, however, does not influence the evaluations in our reviews. Learn more by reading our Advertiser Disclosure. Show More Learn More On Official Website. Best for: automating tax reports. Handling your taxes can be time-consuming and confusing, especially if you are new to cryptocurrencies.
Cryptocurrency tax software can take care of much of the work for you, including importing data, tracking cost basis, and creating tax reports. This can save you time and stress during the tax-filing process. With tax reporting for crypto being a relatively new issue, most tax software providers have created products specifically for this niche. These tools can be tailored to meet your needs and may help you get additional deductions or save on your taxes if you qualify for them.
The first step in choosing crypto tax software is deciding what features you need. Here are some factors to consider when making this decision. Most exchanges do not report transactions directly to the IRS, so many people need to fill out Form for each trade they make. If you have traded on multiple exchanges, you will want to look for software that automatically imports this data.
Tax attorneys themselves sometimes recommend using software that can import this data to simplify the process. Cryptocurrency tax software is designed for short-term and long-term use, but you should also consider how often you plan to file taxes.
If you are filing taxes regularly, choosing a tool with all the features you need may make sense. On the other hand, if you anticipate not filing taxes for several periods, you may not need all the bells and whistles right away. Cryptocurrency tax software can vary widely in price, which is why it is vital to research before choosing one.
While some paid tools offer free trials or basic versions, others consist of much more and can cost hundreds of dollars. Understanding what price tag fits your budget is important when choosing the right software for you. Different types of coins may be subject to different tax rules, so it is best if your software can track specific types of cryptocurrency transactions and calculate the cost basis appropriately.
Some software providers have created tools specifically for certain types of coins, while others use more general investment apps to track coins. Check the respective product descriptions to see which cryptocurrencies each tool supports. It is crucial that your crypto tax tool can quickly and accurately import data from various sources, including wallets and exchanges.
This will help ensure that your records are correct and up-to-date. Most of the software will offer you the ability to import data from your exchanges. However, this is not uniform across all software. Some programs require manual input, which could be time-consuming.
Since tax-related documentation can be pretty sensitive, your crypto tax software must have a secure backup system to ensure you do not lose any of your records if something happens to your computer. The final consideration when choosing crypto tax software is your own needs.
Some tools designed for professional use may be more than you need, while others targeted at non-professionals do not offer all the features you require. By carefully considering each factor and comparing your options, choosing a tool to meet your needs should be possible. Whether you are dealing with Bitcoin, Ethereum, Litecoin, or any other cryptocurrency, it is essential to stay aware of the tax implications.
By choosing the right crypto tax software, you can make this process much easier and less time-consuming. When it comes to tax reporting in crypto, there are some other factors that you should consider. Here are these factors in no particular order. This is a popular technique used to reduce the amount of taxable income. When done correctly, it can save taxpayers money on their taxes. However, tax loss harvesting is a complex process that requires careful record-keeping.
Fortunately, many of the best crypto tax software tools offer features specifically for tax-loss harvesting. If you have converted any of your cryptocurrency into fiat currency, you will need to report this on your taxes. Some software providers can automatically track these conversions, making the process much easier.
However, if your tool does not support this feature, you must do this yourself and include such transactions in your calculations. The crypto you have earned from mining, airdrops, and faucets needs to be included on your tax return when tax season comes around.
Depending on the amount of money you make with crypto during the year, this could play a significant role in your taxes. The country where you pay tax whether it is the U. Make sure you are familiar with the regulations in your country so that you can file an accurate return.
Some cryptocurrencies require users to stake their coins to participate in the network. The returns from this process are similar to those from a Proof of Stake mining reward, so these should also be included as taxable income. Depending on which tool you use, there may be features that will help you track and record staking rewards. If you have donated any cryptocurrency to a charity or other nonprofit organization, you will need to report this on your taxes. The good news is that many of the best crypto tax software tools also include a feature specifically for tracking donations.
This makes the process much simpler and less time-consuming. If you have been using margin trading on an exchange, you need to know that the IRS regards it as a form of income. Consequently, if you earn additional money by taking up margin trades, you will need to factor in these expenses when calculating your total income. You might not fully realize it, but you purchase an asset that can go up or down in value when you buy crypto.
As such, the IRS provides guidelines on calculating your capital gains and capital losses over time. If you have failed to report these correctly, you may end up facing an audit and may even be fined or penalized. However, this process becomes much more manageable if you keep track of your transactions and include the capital gains tax on each transaction as part of your taxable income.
For most people, it is more logical to use a tax software program that can automatically track every detail for you. If you have made any trades or purchased cryptocurrency at a premium, you will need to report this when you file your taxes. The best crypto tax tools should include features for tracking these transactions to simplify the process.
If someone has gifted you cryptocurrency, it is essential to remember that this gift counts as income in some situations and must be reported on your taxes. While many software providers offer features for tracking gift transactions, others do not.
The cryptocurrency price can be pretty volatile, so the value of your holdings could rise or fall over time. You must track each transaction closely to ensure that any gains are correctly reported on your tax return. However, most tools will include features for monitoring these types of transactions and make them much more manageable.
Some of the best crypto tax software providers will allow you to import your transactions from multiple crypto exchanges. This feature can be a huge time saver when compared to manually having to add hundreds of trades. In many cases, you can simply log in to each exchange account and have all the data imported automatically for easy reconciliation. When choosing a system to use, ensure that it is user-friendly and easy to navigate. This will help ensure that you do not miss any critical transactions, resulting in problems when dealing with a taxable event or an audit.
The right tax platform will present the correct IRS form that needs to be filed and all the data required to complete the form accurately. Cryptocurrency trading is becoming much more popular, but your activity and taxable events must be tracked and reported correctly. Choosing an easy-to-use crypto tax software tool can make this process a lot simpler. Ease of use is something to consider in any type of investment you make.
Choosing the best crypto tax filing software can be a complex process. As time goes by, many new tools are introduced, and it can be hard to decide which one is right for you. By considering each of the above factors carefully, you should be able to find a tool that meets your needs. What do you think? Have you used another crypto tax filing software that deserves a mention in this article? Feel free to share your personal opinion and suggestions in the comment section below.
This site is not intending to provide financial advice. This is for entertainment only. Disclosure: Some of the links in this article may be affiliate links, which can provide compensation to me at no cost to you if you decide to purchase a paid plan. This site is not intended to provide financial advice and is for entertainment only. Your email address will not be published. This site uses Akismet to reduce spam. Learn how your comment data is processed. Check our help guide for more info.
What is the Best Crypto Tax Software?
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Users also have the option to get their return reviewed by a tax expert before they file as well as unlimited live tax advice for an extra fee. TurboTax offers a variety of pricing plans. Fees for all plans are only due at the time of filing. Read our full TurboTax review. Users get a similar interface that walks them through the tax preparation process, popup explanations, and the ability to have a return reviewed by an accountant for an extra fee.
It also offers a free plan for simple tax returns like TurboTax but with the added benefit of being able to file Schedule 1 through 3 forms which allow users to report business income, alimony, deductible student loan interest, and more. All plans include on-demand chat, screen sharing, and an online help center.
TaxSlayer offers a simple interface like most of the providers we reviewed. Unlike other providers, TaxSlayer offers limited options to access accountants or professionals who can review a tax return. Read our full TaxSlayer review. Like its competitors, Credit Karma lets users import a previous return from other software and a photo of a W-2 and then walks them through the rest of the process using a series of questions and prompts.
Individuals filing in multiple states or who receive funds from a trust or estate need to look elsewhere. As a free service, Credit Karma offers no phone support. It does, however, include audit defense for its customers which includes consultation from a representative in the event of an IRS audit who will also attend a hearing on their behalf. Read our full Credit Karma Tax review. We like Jackson Hewitt because it offers a huge network of locations for both online and offline preparation tax help.
It lets users import a W-2 and tax returns filed with Jackson Hewitt but not its competitors and then walks them through the filing process through a series of questions with explanatory popups. Any questions and issues are resolved online or over the phone giving customers the experience of working one-on-one with a professional without having to enter an actual office.
Jackson Hewitt has done away with multiple plans for online filers. With this service, customers can work with a tax consultant to help with IRS-related problems including back taxes, tax notices, and property liens and levies.
The service comes with a free consultation, and additional pricing varies based on your needs. May not be combined with any other offer, discount, or promotional price. Use your coupon code during filing in order to redeem. Limited time offer. Promo Code: RAK TaxAct offers nothing new feature-wise than most other tax software programs. Users can import W-2 forms as well as previous returns from other software and then use an online help wizard to answer questions and file their return.
Despite its simplicity, TaxAct offers free and unlimited phone, email, and online chat support. TaxAct offers a free plan for simple returns and support as well as three paid plans which can handle increasingly complex tax filings and offer additional support options. Read our full TaxAct review. Its automatic imports and easy-to-follow prompts make it a winner. Plus, if you get stuck, you can upgrade to have a tax pro take over your preparation for you.
If you have a lot of forms or more complicated taxes, TurboTax is a top choice. Tax software programs automate nearly every aspect of preparing and filing tax returns. Most offer a simple interface that walks users step-by-step through filling out forms, determining deductions, recording income, and more, and then electronically files it for a fee. As a result, most software offers some level of live support to ensure that a return is completed and filed properly and back it up with accuracy and maximum refund guarantees, reimbursing customers for any loss up to a certain amount.
The first is to ensure that every required expense and form are recorded and filed properly. The second thing tax software can do is maximize tax returns. Since tax software gets updated constantly, users are guaranteed to find the latest opportunities to get more money back on their returns. Most major tax software programs allow users to file very simple tax returns for free. From there, they offer tiered plans that can handle more complex types of filings and often include additional levels of support live chat, one-on-one consults, etc.
Every provider we reviewed allowed users to start and work on their returns for as long as they want for free and only charged them when it was time to file a return. Tax software often picks up where accounting software leaves off. Most accounting software is used to keep track of income and expenses throughout the year. By providing an accurate financial breakdown, this information can be used by small businesses to maximize their deductions and ensure accurate filing at tax time.
Many accounting software geared for small businesses can provide certain forms that tax software needs. We looked at close to a dozen tax software programs for this review. At the top of our list was software that was easy to use since most people using these programs have little to no tax experience. Support was also an important consideration, so providers that offered more than online guides like live chat or one-on-one phone support ranked high.
Price was also an important issue. Because users inevitably absorb some risk by preparing their returns themselves, the software would have to cost considerably less than hiring a professional to make it worth the risk. Finally, it was important for us to find software that offered generous accuracy and maximum benefit guarantees.
Import your trades using the API import tool or upload your trade history file. Tax integrates with all major exchanges to make this process quick. Then add your sources of cryptocurrency income from the tax year, and the software will calculate your gains from mining, staking, gifts, airdrops and forks. To finish up, download your transaction data, and download your completed crypto tax report. Your exported tax report will be ready to file yourself, or you can import the file with a popular software like TurboTax or TaxAct.
Get CryptoTrader. TaxBit can help you curate a seamless cryptocurrency tax experience. The software can facilitate issuing s or reporting your own taxes, and it connects those processes with other data to create completed tax reports that are ready-to-file. Related content: How to Calculate Tax on Income. You might qualify for Trader Tax Status TTS if you trade 30 hours or more out of a week and average more than 4 or 5 intraday trades per day for the better part of the tax year.
The designation is not guaranteed. This designation opens up a lot of opportunities for tax efficiency, because professional traders can report their trading income and liabilities as Schedule C business expenses. The direct benefits to this designation include the ability to deduct items such as trading and home office expenses. TTS designated traders must make a mark-to-market election on April 15 of the previous tax year, which permits you to count the total of all their trading gains and losses as business property on part II of IRS form Traders who make this election are also exempt from the wash sale rule.
However, beyond making the election in the previous tax year, traders who choose the mark-to-market accounting method must pretend to sell all holdings at their current market price on the last trading day of the year and pretend to purchase them again once trading resumes in the new year. This is entirely a paper transaction, but has to be done to provide a total accounting of the business assets each year.
The details of tax code for traders are far from straightforward. There is plenty more you might want to investigate yourself. You can deduct your losses from the gains to come to the taxable amount. Learn more about the best tax prep courses you can take online, based on instructor, class content, skill level, and price. Read More. Learn about the best online tax software you can use to file this year, based on fees, platforms, ease-of-use, and more.
Learn more about how to file taxes as an independent contractor using this step-by-step guide. Want to advertise with us? Send us a message. How to Day Trade. Table of contents [ Show ]. Read Review. Starting Price Hourly Fee Depends.
Crypto Tax Software Solutions: Our Top Picks · Koinly - Best for automating tax reports · CryptoTrader. · CryptoTaxCalculator - Best for complex tax calculations. TokenTax is the best crypto tax software in the USA, as well as globally, because it supports each crypto exchange and tax jurisdiction, worldwide. It has. List of the Best Crypto Tax Software. Koinly; Accointing; TokenTax; ZenLedger; TaxBit; Cointracking; BitcoinTaxes; crptocurrencyupdates.com; crptocurrencyupdates.com