Crypto Tax Reporting Tools

Forum|Forum|2 years ago
November 15, 2023
1 reply
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Are there tools tax experts suggest to use for reporting taxes on crypto?

Ask the Experts - Crypto - Nov 2023

RyanH5

Employee Tax Expert

The best tool that you can use is a tracker or aggregator such as Coinbase, but there are several others online as well. This will allow you to keep track of your cost basis whenever you buy, sell, or trade your cryptocurrencies. A good tracker will work across multiple platforms.

Often times, due to the large number of transaction and fractions of coins in each one, trying to track basis at the end of the year is a nightmare. By using a tracker, basis is kept in real time with each transaction.

The reason that basis information is needed, is so that you only pay tax on the amount of gain that you realize whenever you sell or trade your cryptocurrency, rather than the entire amount.

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bdchathamAuthor

Level 2

Thanks Ryan. That's great to hear. Makes total sense. Given crypto is a public ledger, I was wondering if there existed any tool to simply scrape this data to generate your cost-basis automatically.

RyanH5

Employee Tax Expert

There is not any tool that will simply "scrape data" from all platforms to produce your basis information without some sort of guidance input from you. That is where the trackers come into play. You will need to link them with your trading accounts so that they know what data to look for.

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