On Feb. 11, Blockfolio reported its organization with TokenTax to help crypto clients come charge season. The mix will permit Blockfolio clients to import their crypto movement into TokenTax’s computerized programming.
Getting ready for Tax Season
By banding together up with TokenTax, Blockfolio permits clients to import exchange information legitimately into the computerized charge programming. “One of the greatest time sinks for clients is the means by which they get their exchanges into the TokenTax framework,” said TokenTax fellow benefactor, Alex Miles.
Rather than physically contributing crypto-related exchange information or adjusting with applicable trades, Blockfolio clients who sign up with TokenTax can have the entirety of this data naturally added to the duty documenting stage.
Once imported, TokenTax allows users to view their current tax liabilities and generate their tax forms on one platform.
The U.S. government currently identifies cryptocurrencies as assets for tax purposes. Whenever an American citizen buys or sells a cryptocurrency, they must also identify capital gains and losses. Citizens need only to qualify these gains and losses once they sell a cryptocurrency.
But after a year of heavy-trading, identifying each taxable event is cumbersome. This is in part why services like TokenTax, CoinTracking, ZenLedger, TaxBit, and others have formed.
Still, Blockfolio CEO, Edward Moncada, is confident that users will benefit the most from TokenTax. He said:
“We’ve looked across the market and believe that TokenTax’s product hits on all levels – from user experience to reporting accuracy to actual tax expertise and customer service.”
In the case of an audit, such a service could be a lifesaver.
In a Reddit post on Feb. 9, one user posted an audit request the IRS had sent regarding one user’s crypto activity. The tax agency demanded wire transfers, emails, cryptocurrencies earned from faucets, and even the location of physical crypto ATMs if used.
They conclude the document by adding:
“This is not an all-inclusive list. Requests for additional information may be made if considered necessary.”
Having all of these documents accessible in a single location would quickly alleviate much of this stress, especially for active crypto traders and DeFi power users.
For most Americans, taxes are due by Apr. 15 this year.