Cryptocurrency trading has become increasingly popular in recent years, and with it comes the need to report taxes on these investments.
However, calculating taxes on crypto transactions can be complex and time-consuming.
This is where crypto tax software comes in handy. This article will discuss the 9 best crypto tax software services of 2023.
Cryptocurrency trading is complicated enough before considering tax implications. The crypto regulatory landscape seems in a constant state of flux, and tax liability is confusing. It's important to know how to approach crypto taxes in a sensible way that also keeps the IRS from wanting to sniff around. Crypto tax software can help.
Why Use Crypto Tax Software?
Tax filing is a tedious task, and with crypto investment, it can be hard to keep track of all transactions. You would also have to manually calculate tax for applicable crypto transactions and activities, which can quickly become burdensome.
For many investors, this can be arduous, time-intensive, and risky. Crypto tax software can automate the tracking of every transaction, from mining to trading, and generate reports ready for your accountant or directly to the IRS.
These tools can save time and effort in preparing tax reports and ensure that your crypto investing activities are fool-proof from tax errors. Crypto tax software tools can also help tax professionals manage crypto tax specifics for their respective clients.
Here are the 9 Best Cryptocurrency Tax Software Services of 2023:
TaxBit: TaxBit is a popular crypto tax software that offers upfront tax planning, capital gains calculations, and transaction reports. It integrates with popular tax software like TurboTax and TaxAct.
TokenTax: TokenTax is another popular crypto tax software that integrates with popular crypto exchanges, has built-in tax forms, and provides excellent customer support. It is known for its user-friendly interface and comprehensive services.
ZenLedger: ZenLedger is a crypto tax software that caters to tax professionals and offers tax accounting features, including refunds. It is known for its simple and interactive UI.
Koinly: Koinly is a crypto tax software that automates tax reports and offers a tax calculator. It is known for its portfolio tracking and tax reporting features.
CoinTracking: CoinTracking is a portfolio manager that contains tax reporting features. It is known for its detailed reports and analysis.
Accointing: Accointing is a tax app that caters to novice crypto traders and offers features to solve tax problems. It is known for its user-friendly interface and features.
CryptoTaxCalculator: CryptoTaxCalculator is a crypto tax software that offers complex tax calculations for NFTs and other crypto investments. It is known for its features and crypto tax pros.
Blockpit: Blockpit is a crypto tax software that offers simple and interactive UI and compliance features. It is known for its user-friendly interface.
Ledgible: Ledgible is a crypto tax software that offers a comprehensive solution for crypto taxes. It is known for its user-friendly interface and features.
How to Choose the Best Crypto Tax Software
It’s important to research a range of crypto tax software to compare the pros and cons of each option. The best crypto tax software for you depends on what you’re looking for, so consider the following:
Features: Look for software that offers the features you need, such as portfolio tracking, tax reporting, and integration with exchanges.
User Interface: Choose software with a user-friendly interface that is easy to navigate.
Customer Support: Look for software that offers excellent customer support, especially if you’re new to crypto taxes.
Price: Consider the cost of the software and whether it fits within your budget.
How to Complete Crypto Taxes
Once you’ve chosen the best crypto tax software that suits your needs, you should gather all the necessary information to complete your taxes including records of all crypto transactions, purchases, sales, and trades.
The fair market value of each transaction at the time the transaction occurred.
Any fees associated with each transaction.
Any losses or gains from each transaction.
For more information, you can take a look at our detailed crypto tax write-up, however, we also recommend consulting a licensed tax professional if you have specific questions or concerns about your personal crypto tax liability.
You must report your crypto taxes on your tax return and use the appropriate tax forms. The IRS treats cryptocurrency as property, so you should report any gains or losses on your tax return. You may also need to pay estimated taxes over the course of the year if you have significant crypto investments.
Conclusion
Crypto tax software should help you simplify keeping records and submitting tax forms for your crypto investments. With the help of these 9 best crypto tax software services of 2023, you can maximize tax savings and ensure optimal cryptocurrency tax reporting. Remember to choose software that offers the features you need, has a user-friendly interface, and has excellent customer support. The right software and good information can help you complete your crypto taxes quickly and accurately.