Cryptocurrency tax software allows you to prepare your taxes for all of the cryptocurrency assets that you hold. This software will determine your profit and loss from cryptocurrency trading, calculate capital gains or losses, and take deductions on any expenses. The governments need to know what’s your crypto investment doing and became a mandatory thing to do cryptocurrency taxes in coming years.
The total cryptocurrency market cap is $2.79 trillion, equivalent to the 8th largest economy globally.
Choosing the best crypto tax software tool for your needs, first try demo-testing with a few of them. Usually, this sort of software could be free or cost to see how well it works. If there are premium features on an open source platform that you really appreciate and want to make use of, consider giving your first business to its creators as they deserve your support.
Let us dive into the details in this article.
Why do you need crypto tax Software?
Cryptocurrency has achieved massive popularity recently and is expected to continue gaining traction in the years ahead. There are moments of tremendous ups and downs in this decentralized blockchain-backed currency market, but people often say that those who don’t profit from these fluctuations aren’t taking part in the game. Earnings are always thrilling but with each transaction, you must pay taxes.
if you are living in popular countries like US, Europe and India, you definitely need to submit your details to the tax department as per the law.
1. How Cryptocurrency Is Taxed in Different Countries?
Accordingly, proceeds/income arising from “speculative” exchanges between cryptocurrencies or from cryptocurrencies to fiat currencies will be subject to a flat 26% substitutive tax.
2. How To Choose the Right Crypto Tax Software?
The best crypto tax software will be the one that can sync your transaction data with the highest number of different cryptocurrency exchanges. It should also be able to give you a summarized report of all your profit, loss, and tax currency data all in one place.
3. How Crypto Tax Software Works?
Crypto tax software works by streamlining the process of calculating and filing crypto tax returns.
- This app will automatically file your cryptocurrency gains and losses in the tax return form by automating the calculation of your taxable income. Since these services take care of the time-consuming process, they also reduce mistakes that may happen during the manual filing process. Most importantly, when using these apps, errors are virtually prevented and this further helps eliminate any confusion in a very stressful process.
- Software work by integrating with all of your crypto exchanges and wallets via API keys, so that you can pull transaction data and histories from there. The app does the bulk of the work for you, filling in fields on tax forms automatically, or at least making fields easier to enter manually.
4. Is Crypto taxed in the US?
In the United States, cryptocurrencies are being taxed as capital gains.
5. How to convert cryptocurrencies to cash without paying taxes?
If you are a crypto investor and want to save money from taxes you should follow these steps.
- You can Gift your gains to the friend who’s income is low and non-taxable.
- You can move to another state that does not charge any taxes on income.
- You can hold your crypto-holdings for a long period.
- You can invest your gains in an individual retirement scheme.
- You can donate your gains to charity and you get significant leverage from taxes.
Malta is a crypto tax haven. The country recognises Bitcoin and other cryptocurrencies
Best Crypto Tax Software Solutions
Koinly is one of the most feature-rich cryptocurrency tax software you can find. Not only does it provide you with accurate reports, but it has additional features to help keep costs down by ensuring you’re not overpaying. One useful feature that should be known about is its automated data importing. Since it integrates with many exchanges and wallets, it’s unlikely that any transaction record will fall through the cracks .
Once the data has been imported , it will allow you to track every fee and reconcile all information regarding your report from exchanges within a few clicks . It also provides you advanced filtering capabilities in which you can see which transactions resulted in the highest gains and set notifications regarding your balance .
Not only do they offer more than enough features for DIY tax preparation , but this tool is also reasonably priced starting at $49 per year per 100 transactions, $99 per year per 1000 , $179 per 3,000 and $279 for 10,000 or more .
- Automated data importing is available.
- Tools design for top-notch error reconciliation.
- Connects you with tax specialists from the native of five countries.
CoinLedger is an excellent crypto tax calculator that can help you crunch the numbers for your crypto dues and turn them into IRS-approved reports. This compact tool even offers tax-loss harvesting, as a welcome feature. CoinLedger is straightforward to use, highly accurate, integrates with TurboTax and TaxDirect, as well as 100 crypto exchanges and the most popular wallets. It also supports the Ethereum blockchain and NFT transactions.
The price is very affordable, you can try it out for free – if you want to preview or download your reports though, you’ll need to sign up for one of its pricing tiers.
The basic one costs $49 per tax year; Day Trader will set you back $99/tax year for 1,500 trades – while High Volume starts at $199/tax year for 5,000 trades in total (you can upgrade anytime during the year). If you trade more than that then Unlimited might be right up your alley – it will cost $299/tax year.
- It’s an affordable tool.
- It’s a straight forward tool for crypto calculations.
- Excellent integrations in tool
A great way to make sure that you are accurately calculating your taxes related to crypto or online trading is by using CryptoTaxCalculator. Unlike many other similar software products, CryptoTaxCalculator seamlessly integrates with many popular exchanges and wallets, and its built-in calculator will offer very detailed calculations.
In terms of calculations, this software covers things like airdrops, staking, mining rewards, DeFi staking rewards, and initial coin offerings. Once you have decided which option works best for you in terms of transaction frequency, the pricing is relatively low because the Professional package only cost $49/year (up to 100 transactions), the Hobbyist plan only cost $99/year (up to 1000 transactions), and the Trader plan starts at $299/year (up to 10,000 transactions).
- There are most detailed tax calculations in it.
- It supports almost all countries.
- Cryptotax has chain transitions
TokenTax is another excellent piece of crypto tax software you can trust. This tool offers to take a solid selection of crypto tax reports at your vision, including IRS Form 8949. It also helps you with crypto income tax and generate a cryptocurrency audit trail, and international gain and loss reports. Many other solutions on this list can also help with tax-loss harvesting and offers the margin trading support.
The main reason TokenTax stands out from the competition is that it offers cryptocurrency courses in Bitcoin to teach people about the fundamentals of blockchain technologies used in creating cryptocurrencies. You can rely not only on its software but also on its cryptocurrency tax filing team which is available to help you with any tax-related task; all you have to do is send them a message which comes in different tiers starting at $65 per year for up to 500 transactions, going up to $199, $799 and $3,499 respectively for more transaction-handling allowances.
- There are numerous integrations available in this tool
- International trading support
- It has excellent customer support
Accointing.com is a top cryptocurrency tax software solution from Switzerland that helps you manage your crypto taxes in a seamless manner using plug-and-play integrations that help you import all of your transactions for an easy and effortless task management experience.
The interface offers an easy-to-understand navigation for beginners so don’t hesitate to use it! Even non-tax experts can learn more about the software by looking at the blog, with step-by-step guides on how to handle various situations when it comes down to filing your crypto taxes. With things like 300+ supported wallets, exchanges and automatic entries into accounting software, Accointing will certainly be one of the most thorough crypto tax management solutions out there – especially since its professional version costs just $79 per year per 500 transactions.
- Neat and clear dashboard
- It has Tax loss tool
- It supports more than 300 crypto wallets
ZenLedger is an excellent crypto tax solution for helping you take care of your own taxes as well as your clients’ crypto tax requirements. One of the very best features that this service offers is it’s ability to help users calculate capital gains and losses.
If you’re unsure whether or not ZenLedger is right for you, don’t worry, since they provide a free solution with 25 transactions per month up to 100 transactions per year once paid with their Starter plan at $49 per year or the higher tiers beginning at $149 per year all the way up to $999 per year. In addition to being affordable, they also offer a 20% discount on any 1-year subscription or if purchasing more than one year at a time resulting in an additional 20% off bringing their plans down even further.
- Great selection of interrogations
- IRS forms are available
- It offers excellent discounts
BearTax offers a complete solution for transaction accounting, taxation and reconciliation with versatile software interfaces designed to easily configure the terminology according to each country’s reporting requirements. Backed by an experienced team of Certified Public Accountants (CPAs), it is an intuitive, feature-rich Crypto Tax Tool that includes automatic price history updates. Integration with all available exchanges, transfers and wallets, access to price history through Coinmarketcap API; intelligent matching algorithm that makes it easy to identify transactions that are not taxable.
One alternative rate in case the IRS chooses to classify a transaction based on alternative criteria as opposed to dollar amount equivalent. costs $149 per year for up to 25,000 transactions, and the top-tier plan will cost you $499 per year for 1 million transactions.
- It has 24/7 customer support.
- Excellent for tax professionals
- Software buid by traders and accounting professionals
This crypto tax software is probably one of the most straightforward tools that you can use to calculate taxes, and it’s definitely the most affordable tool. 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 the capital gains, and export the reports in the format you need to file your taxes.
The Bitcoin taxes website is also very comprehensive, answering all your questions upfront. It offers multi-year support and has packages for both professionals and casual Bitcoin traders alike. You can try out their first paid tier that includes one thousand transactions for $39.95 per year. The next tier with five thousand transactions is going to cost $49.95 per year and Premium goes all the way up to ten thousand transactions for $59.95 a year.
- It has full service tax validations
- Audit Defense are available
- It is very affordable
If you aren’t looking for an expansive digital tax-filing software and want to plan ahead, TaxBit might be the right choice for you. In its free plan, you can add unlimited transactions and file taxes reports provided that you are utilizing one of more than 500 companies within the TaxBit Network Partners program; as a result of this relationship, daily/monthly totals (deposits or withdrawals) will already be calculated for your reference.
The free version of TaxBit will cover most traders’ needs but should they exceed that scope, they will have to sign up for one of the paid plans which in turn support unlimited transactions and wallet addresses. TaxBit’s first paid plan Basic costs $50 per year and also includes historical tax forms alongside out-of-network transactions; next is Plus+ at $175 per year with Pro priced at $500.
- NFT suit
- Easy to use Dashboard
- Unlimited transaction with the plan.
CoinTracker is not just a cryptocurrency portfolio-tracking solution, but it also holds all the tools you need to use your portfolio tracking as a tax report. You can connect with all relevant exchanges and wallets, also import your transaction history or capital gains, and see your tax summary for each wallet. Probably the best part of this software is the mobile app – excellently rated on Google Play and App Store. You can start tracking and preparing for your taxes with CoinTracker for free that also only for 25 transactions.
The first paid plan, called Hobbyist, will cost $59 for the tax year (in USD) and cover 100 transactions. If you want to cover more than 100 transactions per year, then you should upgrade to the Premium plan at $199 per tax year (again in USD). Be sure to check out their website because they offer custom quotes and prices based on which plan suits your needs best.
- Great Exchange Selection
- Tax summary per Wallet
- Excellent mobile app
The Cointelli platform is an amazing program for those of you just getting started in the blockchain and cryptocurrency world because it will collect data from over 120 different types of platforms and devices in order to provide you with a wide variety of information that would otherwise be quite tedious to compile.
In fact, Cointelli can help you get all of your crypto data including staking, DeFi, and NFT’s from well over 600+ other technologies. The platform even comes equipped with three different ways for you to enter your own information yourself: manual data entry, import from 101 other sources using their API, or by using one of the other third-party blockchain apps available on their marketplace.
- Upload the CSV file and you can free to work on te software.
- It supports NFT also
- APi integrations.
Coin Panda is an international, multi-language cryptocurrency tax app that is the fastest and easiest way to track and report cryptocurrency income. The Coin Panda cryptocurrency tax software tool includes a sleek portfolio tracker. It also offers all major blockchains including Ethereum, Binance Smart Chain, and Polygon. To get started as quickly as possible using our application, simply import transactions from your online exchange wallets and Coin Panda securely. With just one click, you can view and calculate your capital gains report for any given year.
- Margin and Futures support.
- It has Tax loss Harvesting
- Support Staking/lending/DEFI
We hope you enjoyed this article about Cryptocurrency tax software. With this knowledge, we know that you can save money on your taxes by using the right software. We know its bit of complex procedure filing the taxes, and thats why you should talk to your auditor before get into on this one of these tax calculators, understand how it work and make it better for yourself.
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