Over just a few short years, digital money has surged in popularity, sparking a new wave of innovation and ideas that indicate that crypto is here to stay.
Like any type of income, you have to pay tax when you make BitCoins or Ether, no matter where they come from. However, accounting software can solve this problem; but what is the best crypto tax software in 2022?
Those making money with cryptocurrencies have to work hard to make sure they keep up with changes in the market. The year 2021 will soon feel like a whole generation away, with 2022’s software offerings higher growth than before.
Many of the companies we will be exploring in this article were also popular in 2021, with options like CryptoTrader.Tax, TokenTax, and Koinly being veterans of the market. Although, it’s always important to make sure that you are aware of changes in markets, as each piece of software is being constantly updated and improved.
CryptoTrader.Tax has been offering crypto tax help for over three years, providing a dedicated platform for those who want to report crypto taxes. This app has many convenient tools to make your crypto taxes easier.
Be aware that this company is currently rebranding to CoinLedger, and this may have already happened at the time of reading.
Claiming to make it possible to report your crypto taxes in as little as 20 minutes. Like many cryptocurrency tax apps, Coinpanda can be used for free, but is Coinpanda legit? It certainly is, and it has the reviews to back it up.
TokenTax is a more premium option for those who want to get their crypto taxes done in minutes. It offers the option of having a professional crypto accountant help with your taxes. Therefore, most people have something to gain when they choose TokenTax.
Designed for professional investors, ZenLedger is a good choice for those who want to deal with large transactions and central exchanges. Much like TokenTax, ZenLedger customers can choose to pay an extra fee to get a dedicated accountant’s support.
Koinly has gained a huge amount of popularity in recent years. While its not entirely an open-source crypto tax software, this app offers options that are free forever; saving users a lot of money.
Bear.Tax offers simple pricing and options, making it accessible for those who want to get on with their investments and also put taxes at the back of their minds.
Finally, it’s time to explore an option that is perfect for those who want to create backdated reports for their crypto taxes. CryptoTaxCalculator makes it possible to go into the past, allowing you to generate reports for your accountant whenever you like.
Finding the best cryptocurrency tax software for you will take a little bit of sleuthing. One of the main issues you need to look for is accurate, ready-to-use paperwork, and the software you use should be able to export reports that can be filed right away. Without this, you may as well do the whole job yourself.
Alongside this, it’s also worth looking for a crypto tax software that has good integration options with the exchanges, software, and wallets that you use. This will make it easier to automate your taxation process, saving you from having to get out the crypto tax calculator by handling the work in the background.
Looking at our crypto tax software comparison, you will notice that some offer more detail than others. You need software that provides secure and accurate reports to make it as easy as possible to keep track of what you need to pay.
Additionally, you need to think about the price you pay. Crypto tax software prices vary wildly, with options like Koinly offering excellent free memberships that make it possible to get your work done without paying a penny.
The year 2022 is set to be a big year for cryptocurrencies. Large companies are starting to accept payments with it, so the number of people using crypto is on the rise. However, the downside is that it attracts more government attention, meaning you need to be aware of how to handle your crypto tax properly when you’re earning a digital income.
Choosing the best crypto tax software depends on the work you plan to do with it. All of the options we’ve covered have their own benefits, which means you have to assess your needs to find the best option for you. Thankfully, this article gives you all of the details you need to make an informed choice about the crypto tax software you will be using.
Coinbase no longer allows you to submit your gains/losses documents to TurboTax automatically, and you need to use another piece of software called CoinTracker to access your CSVs directly.
CoinBase will issue a 1099 form to all users based within the US, across all of its subscription plans, making it easier to manage your taxes.
Legally avoiding taxes on money that you earn is very hard without simply earning less. Those just above a tax threshold can often improve their income by earning less to pay less tax.
The IRS can’t track Bitcoins very easily, but will certainly be able to track it when you exchange crypto for different currencies. Hiding any cryptocurrency from the IRS will cause issues if you are audited, making it well worth paying the taxes you owe when they are due.
While the IRS treats cryptocurrencies differently from traditional money, it still views Bitcoin (and other cryptos) as property. This means that buying it isn’t a taxable event, though earning it could be, even if you don’t cash out.
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