For many crypto investors, keeping track of capital gains and losses is an uphill task, as they engage in several profitable transactions monthly. Crypto trading skyrocketed in 2021, with several newcomers obtaining and trading cryptocurrency.
Like real estate and stocks, the IRS categorizes cryptocurrency holdings as property. However, your crypto is not taxable at all times. Only events like selling cryptocurrency can incur a taxable charge. So many investors incur losses and gains due to the dynamic nature of the crypto market.
As an investor, getting the best tax management tools is necessary to ensure you are abreast of your tax obligations. Several crypto tax software tools are now available to manage your crypto taxes, track gains and losses and automate several other processes. Here’s how we picked the best software products for this roundup.
Our Top Picks For The Best Crypto Tax Software
- CoinLedger– Overall Best Crypto Tax Software, Editor’s Pick
- CoinTracking– Most Recommended Software For Real-Time Tracking
- ZenLedger– Suitable For Novice Crypto Traders
- TokenTax–Top Rated Tax Software For DeFi, NFT, And Crypto
#1. CoinLedger– Overall Best, Crypto Tax Software, Editor’s Pick
CoinLedger is the industry’s most efficient tax software provider. Formerly known as Cryprotrader, this top-notch tool is a one-stop shop for both newbie crypto traders and old-timers. This platform, founded in 2018, supports over 10,000 crptocurrencies and lets users easily import their wallets and exchanges to the software.
It also has a feature that tracks the cost basis of your coins during their transfer through different wallets. The software also performs automatic classifications of all your transactions and allows you to also manually classify them.
An excess of $70 billion worth of transactions have been processed by CoinLedger, and it boasts a customer base of over 300,000. With CoinLedger, users can view their capital gains and losses for free. Users can also easily download their tax reports with this software after making payments. CoinLedger offers tax-saving opportunities for its users and claims to have saved 50 million dollars through tax-loss harvesting. With this software, you can upload your tax reports to your preferred tax platform, like TurboTax.
CoinLedger has a round-the-clock support team that attends to customer issues and treats them promptly. The customer support team is accessible by email and chat. Its customer-first policies and efficient service has earned this service a top spot on this list. CoinLedger has 4.8 out of 5 stars on TrustPilot, with many users hailing the service as the best crypto tax software. With CoinLedger, NFT traders can also import their NFT trades to calculate taxes and track profits and losses.
To sign up for CoinLedger, you’ll simply need to add your personal information, verify your account, select your region and local currency and import your transaction history. CoinLedger has a tiered structure for payment based on your volume of transactions.
Export Reports To Providers: With CoinLedger, users can export and upload their tax reports to supported providers such as TaxAct and TurboTax. This feature makes this software convenient if you want to export your reports to your chosen tax platform.
Tax Saving Opportunities Available: CoinLedger claims to have helped save 50 million dollars for customers through its tax-loss harvesting. This feature affords users the opportunity to reduce their taxable capital gains across their portfolios.
Free Capital Gains/Loss Review: Before downloading your tax report, you can view your capital gains and/or losses on CoinLedger. This free feature is great as it helps you know your gains and losses before purchasing your tax resort.
Excellent Customer Reviews: CoinLedger has near-perfect customer ratings on all major review sites online. On TrustPilot, they have a 4.8/5 star rating from thousands of users. CoinLedger utilizes end-to-end encryption to ensure user data is secure on the site.
International Tax Reports: With CoinLedger, you can use your tax reports to fill international tax forms in the USA, Canada, and Australia.
- Suitable for crypto newbies and pros
- View capital gains and losses for free
- Several packages available
- Free trial period available
- Tax saving opportunities available
- NFT taxing available
- No crypto payment option
- No free use for hobbyists
#2. CoinTracking– Most Recommended Software For Real-Time Tracking
Thousands of cryptocurrency traders today use CoinTracking as a tax Software and portfolio tracker. This software tracks your transactions across your portfolio in real time. CoinTracking can integrate with nearly 80 cryptocurrency exchange platforms.
With CoinTracking, it doesn’t matter which wallet or exchange holds your crypto or how many transfers you make, and the software effectively tracks your gains/losses and your cost basis. The platform supports over 5,000 digital coins and provides detailed portfolio reporting. The software boasts over 1.2 million active users.
Users hail the software for its user-friendly interface. The software helps users figure out how to fill out the Schedule D (1040) form. The convenience and functionality of this software make it one of the top crypto tax software.
CoinTracking does not charge a subscription per tax year but instead charges an annual subscription fee. With CoinTracking can import historical data from as far back as 2009. With their model, users can get a tax report for one year and up to 13 years for the same annual subscription fee. CoinTracking offers different packages ranging from $0 to $660. With the free account, users can input manual entries and CSV imports and get a tax report for up to 100 transactions.
You can use CoinTracking to generate multiple tax forms, including Schedule B and Schedule for your tax reports. CoinTracking accepts several payment methods, including Google Pay, SEPA, PayPal, etc Each of the plans available on CoinTracking comes with a backup feature to help you keep a backup of your CoinTracking portfolio in case your data gets missing or corrupted. Moreover, the software has an SSL certification to encrypt your data and keep it safe on the platform.
Annual Subscription Model: By far, the most standout feature of CoinTracking is its annual subscription model. With this model, users pay the same annual fee even when calculating taxes from several different tax years. Bear in mind, however, that every user has an account transaction total limit, and your calculated taxes from all the years will all count towards the limit.
Payment Options: CoinTracking has several payment options available for its users. They accept over 50 altcoins, Google Pay, credit cards, PayPal, etc.
Gains Calculator: With CoinTracking, you can calculate your unrealized profits/losses. So, you can also sort them in an order that would let you determine the losses that could help you offset your gains.
Multiple Tax Forms: CoinTracking helps users generate 8949 and personalizes Form 1040 and Schedule 1, etc., for their tax reports.
- Supports Over 140 Exchanges/Wallets
- Supports multiple payment methods
- Personal trade backups
- Tax filing software export
- Mobile app available
- Simple interface
- Limited imports
- Limits on lifetime transaction
#3. ZenLedger– Suitable For Novice Crypto Traders
Thousands of cryptocurrency traders use ZenLedger crypto tax software to track their asset portfolios and generate tax reports. The software currently supports over 400 exchanges, including Binance, Bittrex, Coinbase, and over 20 DeFi protocols.
The mission of this software, since its inception in 2017, has been to create user-friendly software for crypto traders to track investments. To start using ZenLedger crypto tax software, simply register on the website, and connect to all your crypto wallets.
Afterward, review your historical transactions to ensure you’ve imported your transactions successfully. After reviewing your transactions, generate and file your tax reports. ZenLedger creates seven documents for its users every tax year. These include IRS form 8949, Tax-loss harvesting, Grand Unified Accounting, etc.
ZenLedger has a free version that will meet users’ needs to process less than 25 transactions. However, transactions above 25 start at a yearly fee of $49. For users who need NFT, DeFi, and staking support, subscriptions start from $149. ZenLedger provides a robust offering for tax accounting for decentralized finance (DeFi).
TurboTax Integration: Unlike some other crypto tax software tools, ZenLedger has a TurboTax Integration that lets users compile crypto tax documentation with their annual tax reports seamlessly.
Free Subscription Option: ZenLedger offers a free option on their service. Users of the free account are limited to 25 transactions. Even though these free accounts have limits, users can still download detailed tax reports. Furthermore, they will also receive premium customer support.
DeFi Tax Tracking: This software appears to be optimized for DeFi. DeFi is still a pretty complicated part of blockchain technology, and it may be hard figuring out your accounting. So, ZenLedger is perfect for individuals who want to track their DeFi and cryptocurrency transactions.
Customer Support: ZenLedger is known for its excellent customer support. While every customer receives premium support from ZenLedger, customers who wish to speak to a licensed tax professional might need to pay a small fee.
- Easy-to-use app
- Free account
- Integration with DeFi apps
- No localized tax document for non-US resident
#4. TokenTax– Top Rated Tax Software For DeFi, NFT, And Crypto
TokenTax is a full-service crypto tax accounting firm with highly intuitive crypto tax software. It will sync with as many Wallets and APIs, thus eliminating the need for manual input.
Unlike many other crypto tax software tools, TokenTax started as a crypto tax accounting firm. Its features are optimized to help crypto newbies and old-timers have a seamless, efficient means of calculating and filing taxes for crypto, DeFi, and NFTs. In 2017 when it was founded, it was a simple software that imported data off coinbase to calculate users’ tax obligations.
TokenTax also provides specialized services for people with complex accounting issues. Moreover, their highly qualified tax professionals are available to fix messy data situations and issues stemming from high-volume transactions.
TokenTax posits that the complexity of cryptocurrency might be preventing mainstream adoption. Thus, it simplifies everything about the user experience of its software to ensure that even learners are able to navigate it.
Pricing: TokenTax plan pricing begins with a 65-dollar price per year. This beginner package includes about 500 transactions and also has the Coinbase Pro APIs.
The VIP package ranges at 3,500 dollars per year, and it comes with about 30,000 central exchange transactions. Nevertheless, you can upgrade your transaction count for the VIP package with an additional fee.
User-friendly: The TokenTax website interface is polished and clean. So, there are no longer technical hiccups and jargon. Thus, it is simple to use.
Non-cryptocurrency Tax Handling: TokenTax’s VIP package includes a full-return filing for an additional $1,000.
- Available in every country
- Certified customer support
- Works with many reputable exchanges
- Supported by many crypto enthusiasts
- Tax loss harvesting tool
- Import forms
- The trial period is not available
- Must contact customer support before making payments
- Not cost-effective
- Not ideal for beginners
How We Made The List Of The Best Crypto Tax Softwares?
With many software solutions on the market, it’s hard to know which are efficient and would give you the best experience. To make our list of the most useful crypto tax software, we had to undergo a selection process. We chose some criteria to help us determine and choose the best of the best crypto tax software. Here are the qualities we looked for.
What We Looked For?
These factors below are the essential ones we considered before making our list:
- Free Trial/Subscription: In our search for the most effective crypto tax software, we ensured that we chose companies willing to provide a free service or at least a free trial. This makes it easier for users to browse their options before committing to anyone financially.
- Number Of Wallets/Exchanges Accepted: We ensured that the top picks accept a robust selection of wallets. Since most people using tax software have assets on many exchanges, it’s necessary for users to use crypto tax software to import and track their data from all their wallets.
- Tax Saving Opportunities: We prioritized software with tax-loss harvesting features. So, users using this software will not only calculate their taxes accurately, but they also get the opportunity to offset their gains and reduce their taxes.
- Excellent Customer Reviews: We looked for the software tools with the best ratings and reviews online to make this list.
Buying Guide For The Best Crypto Tax Softwares
So, before investing in any cryptocurrency tax software, you should consider the following factors:
- User-Friendly Packages
A number of the top cryptocurrency tax software programs are known for their user-friendliness. Moreover, they convey information in plain language and feature a tidy interface or dashboard.
Not all crypto tax brands can cite such attributes as an advantage. If you’re not a tax expert, you might want to opt for a user-friendly solution. But by spending money on the finest user-friendly cryptocurrency tax software, even experts may save time.
- DeFi Integration
Cryptocurrency Tax software that integrates DeFi is something you might want if you’re keen on DeFi, like NFT. Decentralized Finance integration is generally not something you need to bother yourself with if you employ centralized exchanges.
- Tax Calculators
The accurate and reliable crypto tax calculator may make it simple to compute crypto taxes and ensure that your tax statement is error-free, thus bringing a crypto tax solution. It is important to consider how well a company’s calculators function. In fact, the more accurate your state and federal tax filings are, the less stress you may spare yourself in the future.
FAQs Regarding Crypto Tax Software
Does cryptocurrency include capital gains?
Like equities and other forms of property, cryptocurrencies are taxed. When you make a profit by disposing of or selling cryptocurrency, you must pay taxes according to the profit amount. Moreover, crypto gains are taxed the same amount as stock capital gains.
Crypto tax calculator: is it reliable?
The Crypto Tax Calculator is a fully legitimate tool. Furthermore, given the high ambitions of many crypto exchange companies who offer this service, it appears that the platforms have a large user base and, more significantly, are improving.
How do I get crypto tax advice?
Such crypto tax software advice can come from only tax attorneys, certified agents, and CPAs.
Conclusion: Which Is The Most Effective Tax Software For Crypto?
So, if you are a newbie or advanced trader, you must utilize crypto tax software at some point. The ones on our list import your assets and information from all your trading wallets, help you calculate your tax, and possibly save on your tax obligations.
So, read our buying guide to help you choose the best crypto tax software tailored to your needs. These tools will give you accurate tax reports and the best crypto tax services. It’s important to note that the IRS could consider even honest errors regarding your tax reports as fraudulent. Thus, investing in good crypto tax software is essential if you have high-volume trades. Don’t forget to visit tax professionals to help you out. Trade like a pro.