Organizing taxes has always proved a difficult process for companies and individuals during the yearly tax season. With crypto, this process becomes even more complicated.
Although cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) appear similar to fiat currencies, in the eyes of the taxman, these digital assets need to be treated differently. This means cryptocurrency transactions may need to be reported as capital gains or losses.
That is why it’s important to keep track of crypto transactions over time. Software like Cointelli makes it easy for both individuals to file crypto tax returns and for tax professionals to offer crypto-tax preparation, calculations and support to their individual and small business clients.
Understanding what taxes apply in which geographies and reporting efficiently can help eliminate the stress that usually comes with calculating taxes. As more and more organizations are accepting payment in cryptocurrency and individuals are being paid in digital assets, it is becoming more important that everyday people begin to decipher the world of crypto taxes. With roughly 16% of the adult population investing in cryptocurrencies, and this market expected to massively grow, the U.S. government has drafted cryptocurrency tax regulations.
Reporting complex transactions across a number of platforms can be time-consuming and can involve a lot of mistakes when it comes to recording the right level of detail. There are so many boxes that need to be ticked correctly that trying to analyze all the data manually can quickly become frustrating. A simplified, all-in-one software like Cointelli allows users to minimize crypto tax errors and also makes the process more efficient.
So how exactly can people untangle the complexities that come with filing crypto taxes? Cointelli is offering an all-in-one crypto tax solution that solves the practical difficulties and makes the crypto tax reporting process as straightforward as possible while maintaining a very high standard of accuracy. The team at Cointelli have designed a software package for crypto taxes that allows you to review your tax report and fix any errors in a simple and seamless way.
"Crypto exchanges are increasingly reporting users' transactions to the IRS, so the need for crypto tax reporting is here,” said Cointelli CEO Mark Kang. “However, existing solutions are often expensive, inaccurate and aren't compatible with enough global exchanges. Cointelli puts an end to the frustration by providing software that is reliable, easy to use and affordable for the average investor.”
There are a number of crucial steps when reporting crypto taxes using software, and these involve extracting and importing transaction data from multiple exchanges and wallets. To ensure accuracy, Cointelli supports importation from a large number of exchanges, including Coinbase, Binance and Kucoin. Individuals and organizations need to assess whether or not their software allows for multiple ways of importing this data. If not, then using the software for the sake of efficiency becomes fruitless. Cointelli provides a range of easy methods for importing data from across platforms, making it very user-friendly for all kinds of users.
Parties also need to be careful when calculating taxes for transactions from across different platforms. For example, Bitcoin can be marked as BTC in some platforms but as XBT in others. Most cryptocurrency tax software platforms ignore details like this and rarely-used transaction types when importing transaction data. This means that some data may fall through the cracks, leading to customers filing tax returns with critical information missing.
Tax reporting requirements are getting more stringent around the world. The Cointelli software, designed by tax professionals, allows traders to manage their crypto investments while producing compliant tax reports. It is also offered as a featured service by prominent U.S.-based digital money platform, Uphold.
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