Are you struggling to understand the IRS' cryptocurrency tax laws?

Are you struggling to understand the IRS' cryptocurrency tax laws?

Ok, you bought some bitcoin, and maybe some alt-coins, so now what?  (An alt-coin is a digital crypto asset that is not bitcoin.)  How do you determine your IRS tax liability?  Yes, tax liability.  Keep reading, and you’ll learn about a solution to this problem that will allow you to get a good nights sleep.

 

Before we get to it, let me say that a bit further down the page I will mention an important opportunity if you are a CPA or accountant, and don't want to lose any clientele because they own cryptocurrencies.  Also, if you are looking for ways to expand your business, this entire article is worth the read.

 

If you have ever wondered how to report cryptocurrency on taxes, you’re not alone.  I was clueless until I received a recommendation from world-renowned crypto guru, Teeka Twari.  He suggested checking out ZenLedger.  Not being a super technical person, I was a bit overwhelmed when faced with checking into their software.  

 

My fears quickly subsided, as the ZenLedger support team was right there with timely and clear responses to my questions.  After researching other companies, I found they blew the competition away when it comes to customer service and response times.  After going through their tutorial, their software spit out some 25 pages, including IRS form 8949 as well as Schedule D.  Given my CPA could never have figured this out, I quickly concluded that ZenLedger was a must have.

 

More importantly, I could rest assured that I was following the IRS crypto tax guidelines so not to be at risk for a possible audit down the road.  It's an understatement to say that ZenLedger makes my life a lot less stressful.  For those new to bitcoin, I have provided some brief thoughts below about this asset class.

Ok, you bought some bitcoin, and maybe some alt-coins, so now what?  (An alt-coin is a digital crypto asset that is not bitcoin.)  How do you determine your IRS tax liability?  Yes, tax liability.  Keep reading, and you’ll learn about a solution to this problem that will allow you to get a good nights sleep.

 

Before we get to it, let me say that a bit further down the page I will mention an important opportunity if you are a CPA or accountant, and don't want to lose any clientele because they own cryptocurrencies.  Also, if you are looking for ways to expand your business, this entire article is worth the read.

 

If you have ever wondered how to report cryptocurrency on taxes, you’re not alone.  I was clueless until I received a recommendation from world-renowned crypto guru, Teeka Twari.  He suggested checking out ZenLedger.  Not being a super technical person, I was a bit overwhelmed when faced with checking into their software.  

 

My fears quickly subsided, as the ZenLedger support team was right there with timely and clear responses to my questions.  After researching other companies, I found they blew the competition away when it comes to customer service and response times.  After going through their tutorial, their software spit out some 25 pages, including IRS form 8949 as well as Schedule D.  Given my CPA could never have figured this out, I quickly concluded that ZenLedger was a must have.

 

More importantly, I could rest assured that I was following the IRS crypto tax guidelines so not to be at risk for a possible audit down the road.  It's an understatement to say that ZenLedger makes my life a lot less stressful.  For those new to bitcoin, I have provided some brief thoughts below about this asset class.

Is bitcoin a good investment? - A short summary of where bitcoin is today. 

Is bitcoin a good investment? - A short summary of where bitcoin is today. 

There’s not enough time to cover the technical aspects of cryptocurrencies in this article.  The main point I want to make to make is that these digital assets are not going anywhere, so the need for IRS crypto tax software like ZenLedger will just increase.  Many see bitcoin and other cryptocurrencies as an opportunity to make huge returns with very small investments across many coins.  They are considered a great asymmetric investment opportunity, especially given the liquidity issues and market volatility as a result of the Covid-19 virus that recently hit the world.  That said, they're not for everyone.  

 

Bitcoin and cryptocurrency, in general, has been prone to volatility.  There are, however, a number of bullish developments that have been in the works for some time.  According to Teeka Twiari, bitcoin expert, Bakkt, which is a subsidiary of the company that owns the New York Stock Exchange, launched a trading platform for institutional investors.  The daily volume on this platform was recently up over 800%.  Bakkt settles futures contracts with bitcoin rather than cash, and holds actual bitcoin on behalf of its clients, thereby removing it from the market.  This is huge according to Teeka, because it will shrink the supply and potentially put upward pressure on the price of bitcoin.  

 

Although it has not fully materialized, we are already seeing a number of brokerage firms like TD Ameritrade, Fidelity, and others lining up to offer their retail customers the chance to buy bitcoin, with the click of the mouse.  When Wall Street finally jumps in with both feet, it will have a major impact on bitcoin and cryptos in general. 

 

Additionally, the halving of bitcoin that occurs every 4 years is about to happen again in May of 2020.  This halving phenomenon should be very good for those who hold bitcoin and alt-coins as well.  As the saying goes, a rising tide floats all boats.  This deflationary event will ensure that as the supply goes down, it should also put upward pressure on demand.  Keep in mind, only 21 million bitcoin can be mined.  That’s it.  (Even the price of gold can potentially be manipulated, as new reserves are found in the ground.)  Currently, over 18 million bitcoins have been mined, and the halving that occurs every 4 years ends in in approximately 2140.    

 

Another factor that should lend stability to this digital asset group is that IRS recently issued its first cryptocurrency tax guidance since 2014.  This is extremely bullish for bitcoin and will add even more legitimacy to this asset class.  No longer do we need to fear that buying bitcoin is somehow not acceptable.  This is where ZenLedger comes in.  As I mentioned, I am a customer myself.  It saved me a ton of time and headaches, and I believe it is worth a serious look if you own any amount of cryptocurrency.

There’s not enough time to cover the technical aspects of cryptocurrencies in this article.  The main point I want to make to make is that these digital assets are not going anywhere, so the need for IRS crypto tax software like ZenLedger will just increase.  Many see bitcoin and other cryptocurrencies as an opportunity to make huge returns with very small investments across many coins.  They are considered a great asymmetric investment opportunity, especially given the liquidity issues and market volatility as a result of the Covid-19 virus that recently hit the world.  That said, they're not for everyone.  

 

Bitcoin and cryptocurrency, in general, has been prone to volatility.  There are, however, a number of bullish developments that have been in the works for some time.  According to Teeka Twiari, bitcoin expert, Bakkt, which is a subsidiary of the company that owns the New York Stock Exchange, launched a trading platform for institutional investors.  The daily volume on this platform was recently up over 800%.  Bakkt settles futures contracts with bitcoin rather than cash, and holds actual bitcoin on behalf of its clients, thereby removing it from the market.  This is huge according to Teeka, because it will shrink the supply and potentially put upward pressure on the price of bitcoin.  

 

Although it has not fully materialized, we are already seeing a number of brokerage firms like TD Ameritrade, Fidelity, and others lining up to offer their retail customers the chance to buy bitcoin, with the click of the mouse.  When Wall Street finally jumps in with both feet, it will have a major impact on bitcoin and cryptos in general. 

 

Additionally, the halving of bitcoin that occurs every 4 years is about to happen again in May of 2020.  This halving phenomenon should be very good for those who hold bitcoin and alt-coins as well.  As the saying goes, a rising tide floats all boats.  This deflationary event will ensure that as the supply goes down, it should also put upward pressure on demand.  Keep in mind, only 21 million bitcoin can be mined.  That’s it.  (Even the price of gold can potentially be manipulated, as new reserves are found in the ground.)  Currently, over 18 million bitcoins have been mined, and the halving that occurs every 4 years ends in in approximately 2140.    

 

Another factor that should lend stability to this digital asset group is that IRS recently issued its first cryptocurrency tax guidance since 2014.  This is extremely bullish for bitcoin and will add even more legitimacy to this asset class.  No longer do we need to fear that buying bitcoin is somehow not acceptable.  This is where ZenLedger comes in.  As I mentioned, I am a customer myself.  It saved me a ton of time and headaches, and I believe it is worth a serious look if you own any amount of cryptocurrency.

The IRS and crypto tax laws - Virtual currency tax tips and crypto tax laws.

The IRS and crypto tax laws - Virtual currency tax tips and crypto tax laws.

The IRS treats cryptocurrency as property, which makes it similar to a home or an equity investment. With each transaction, taxpayers must calculate their gain or loss on conversion and report that figure on their tax return. Taxpayers owe short- or long-term capital gains on the total depending on how long the original cryptocurrency was held prior to the sale.

According to the IRS, the sale or other exchange of virtual currencies, or the use of virtual currencies to pay for goods or services, or holding virtual currencies as an investment, generally has tax consequences that could result in tax liability.

There’s no need to tangle with the IRS years down the road because you didn't know how to calculate the taxes owed on your crypto portfolio.  Keep in mind, if you have losses, ZenLedger will show you those tax benefits that you don't want to miss out on.  If you’re going to own bitcoin or other cryptocurrencies, you might as well do it right the first time, and keep the IRS from knocking on your door when you least expect it.  

 

ZenLedger is constantly updating their platform.  You can rest assured that your crypto tax data are handled correctly and that you'll receive ongoing support and important IRS tax updates.  After-all, who in the world has the time to stay on top of the changes that come down the pike regarding tax law and cryptos?  I know I don’t.  That is why I chose ZenLedger over TokenTax, CoinTracker, TaxBit, CryptoTrader, and BearTax.

The IRS treats cryptocurrency as property, which makes it similar to a home or an equity investment. With each transaction, taxpayers must calculate their gain or loss on conversion and report that figure on their tax return. Taxpayers owe short- or long-term capital gains on the total depending on how long the original cryptocurrency was held prior to the sale.

According to the IRS, the sale or other exchange of virtual currencies, or the use of virtual currencies to pay for goods or services, or holding virtual currencies as an investment, generally has tax consequences that could result in tax liability.

There’s no need to tangle with the IRS years down the road because you didn't know how to calculate the taxes owed on your crypto portfolio.  Keep in mind, if you have losses, ZenLedger will show you those tax benefits that you don't want to miss out on.  If you’re going to own bitcoin or other cryptocurrencies, you might as well do it right the first time, and keep the IRS from knocking on your door when you least expect it.  

 

ZenLedger is constantly updating their platform.  You can rest assured that your crypto tax data are handled correctly and that you'll receive ongoing support and important IRS tax updates.  After-all, who in the world has the time to stay on top of the changes that come down the pike regarding tax law and cryptos?  I know I don’t.  That is why I chose ZenLedger over TokenTax, CoinTracker, TaxBit, CryptoTrader, and BearTax.

How ZenLedger works.

How ZenLedger works.

ZenLedger supports over 300 exchanges and tons of coins, so it's easy to calculate capital gains and losses across exchanges, as well as auto-fill popular IRS forms, including Form 1040 Schedule D and Form 8949.  You just upload your transactions from the exchange or wallet using an API or CSV.  They provide you with all the instructions.  If you have questions, you can email them and get a quick response from a real person 7 days a week.  You don’t have to worry about calculating the cost basis for each transaction or accruing thousands of dollars in fees for having accountants go through and do it manually.

ZenLedger's automated process makes it easy to import your crypto transactions, calculate gains and income, and auto-fill tax forms.  It works with all major exchanges and crypto and fiat currencies.  

  • Bitcoin
  • Ethereum
  • Litecoins
  • Dollars
  • Euros
  • Pounds Sterling
  • Yen. . . . and more.

 

ZenLedger will produce profit and loss statements for you and your CPA.  Whether you’re a miner, day trader, or Hodler, they pour over the tax regulations to make sure you never unknowingly overpay your taxes.

 

You can also import your transactions and ZenLedger will prepare documents such as Capital Gains Reports, Income Reports, Donation Reports, and Closing Reports.

Additionally, if you use TurboTax, you’ll be glad to know that ZenLedger is an official partner.  You can automatically integrate your transaction data with TurboTax Desktop or Online.  ZenLedger is quickly being recognized as a growing a cutting-edge solution for crypto tax reporting.  

ZenLedger supports over 300 exchanges and tons of coins, so it's easy to calculate capital gains and losses across exchanges, as well as auto-fill popular IRS forms, including Form 1040 Schedule D and Form 8949.  You just upload your transactions from the exchange or wallet using an API or CSV.  They provide you with all the instructions.  If you have questions, you can email them and get a quick response from a real person 7 days a week.  You don’t have to worry about calculating the cost basis for each transaction or accruing thousands of dollars in fees for having accountants go through and do it manually.

ZenLedger's automated process makes it easy to import your crypto transactions, calculate gains and income, and auto-fill tax forms.  It works with all major exchanges and crypto and fiat currencies.  

  • Bitcoin
  • Ethereum
  • Litecoins
  • Dollars
  • Euros
  • Pounds Sterling
  • Yen. . . . and more.

 

ZenLedger will produce profit and loss statements for you and your CPA.  Whether you’re a miner, day trader, or Hodler, they pour over the tax regulations to make sure you never unknowingly overpay your taxes.

 

You can also import your transactions and ZenLedger will prepare documents such as Capital Gains Reports, Income Reports, Donation Reports, and Closing Reports.

Additionally, if you use TurboTax, you’ll be glad to know that ZenLedger is an official partner.  You can automatically integrate your transaction data with TurboTax Desktop or Online.  ZenLedger is quickly being recognized as a growing a cutting-edge solution for crypto tax reporting.  

Bitcoin and crypto accounting software for CPA’s and bookkeepers.

Bitcoin and crypto accounting software for CPA’s and bookkeepers.

Most CPA’s are not aware of the hidden window of opportunity to boost their efficacy and authority and to retain and add more clients to their business portfolio.  Most would be shocked to know how many US citizens own cryptocurrencies who need their help.  Right now, bitcoin and crypto holders have very few places to turn, and even fewer places that are knowledgeable and trustworthy.  The biggest tip I have for CPA’s is to look very hard at the ZenLedger solution.

Most CPA’s are not aware of the hidden window of opportunity to boost their efficacy and authority and to retain and add more clients to their business portfolio.  Most would be shocked to know how many US citizens own cryptocurrencies who need their help.  Right now, bitcoin and crypto holders have very few places to turn, and even fewer places that are knowledgeable and trustworthy.  The biggest tip I have for CPA’s is to look very hard at the ZenLedger solution.

Bitcoin tax software for CPA’s.

Bitcoin tax software for CPA’s.

Up until now, cryptocurrency has been a subject that many CPA's and accountants have been wary of.  The reality is that cryptocurrency and the blockchain technology it uses, is here for the long haul.  ZenLedger is a pioneer in offering a transparent solution for CPA's who want to be able to help their customers.  Without ZenLedger, it would take tons of employee hours to look up the prices of each transaction and track the cost basis by hand.

 

Here are some of the benefits CPA's & accountants get when they use ZenLedger:

  • Their simplified process collects all client data in one place to save time and eliminate confusion.
  • Calculations are completely automated.
  • There are no subscription fees, so you can use it with as many clients as you want.
  • It easily imports client transaction data via CSV or API.
  • Client’s data is exportable to Turbo Tax.
  • There is an audit report showing you how your client’s taxes were calculated.
  • It will create Schedule D and Form 8949.  It will tell you peak assets for FinCen 114 FBAR and FACTA.
  • You have the ability to customize and edit anything you need to before completing the tax forms.
  • All completed IRS forms are downloadable and printable.  All that’s left is the client’s signature.
  • ZenLedger has a super blog and customer support to keep you up to date on the latest cryptocurrency tax guidelines and information.

Up until now, cryptocurrency has been a subject that many CPA's and accountants have been wary of.  The reality is that cryptocurrency and the blockchain technology it uses, is here for the long haul.  ZenLedger is a pioneer in offering a transparent solution for CPA's who want to be able to help their customers.  Without ZenLedger, it would take tons of employee hours to look up the prices of each transaction and track the cost basis by hand.

 

Here are some of the benefits CPA's & accountants get when they use ZenLedger:

  • Their simplified process collects all client data in one place to save time and eliminate confusion.
  • Calculations are completely automated.
  • There are no subscription fees, so you can use it with as many clients as you want.
  • It easily imports client transaction data via CSV or API.
  • Client’s data is exportable to Turbo Tax.
  • There is an audit report showing you how your client’s taxes were calculated.
  • It will create Schedule D and Form 8949.  It will tell you peak assets for FinCen 114 FBAR and FACTA.
  • You have the ability to customize and edit anything you need to before completing the tax forms.
  • All completed IRS forms are downloadable and printable.  All that’s left is the client’s signature.
  • ZenLedger has a super blog and customer support to keep you up to date on the latest cryptocurrency tax guidelines and information.

How does ZenLedger stack up?

How does ZenLedger stack up?

Peer reviews and more.

Peer reviews and more.

A reliable service with great communication. It also provides concise information regarding trading / tax practices.  Mike Zarkos - Chief Cryptocurrency Officer @ ApexRidge Capital

 

I used ZenLedger to get my crypto taxes organized and done. It was very smooth and easy to do.  Jas Gill - CEO/Co-founder of BeeBack.io

 

I used ZenLedger a couple days before the tax deadline and they saved me. I gave their CEO a hug.  Zane Witherspoon - CTO of Dispatch Labs

 

I restated my taxes from 2013 using ZenLedger and found $235,000 in overpayment to the IRS.  Luke Riddle - Employee #30 at Coinbase

 

I think your company is going to ride a tsunami wave of success with your software.  Without it, doing taxes is impossible.  b************1@gmail.com

 

I will be a lifetime member to ZL. Most of the others in our 14 member investment group are techies and we all use ZL. Myself and my dad, are the weak link. your team and product saved us. Toast to you.  c***********s@hotmail.com

 

Yes! I never thought I’d be so happy to see 47k in losses! I just bought the premium plan and will recommend your software to others. Thanks for the help!  j**********e@gmail.com

I thought I had a handle on my limited crypto trading for 2018, but I was wrong. ZenLedger gave me a valuable education in what is really required for tax reporting and made it very easy to gather the necessary records. The software did all of the work from there. I highly recommend this product.  Chris H.

A reliable service with great communication. It also provides concise information regarding trading / tax practices.  Mike Zarkos - Chief Cryptocurrency Officer @ ApexRidge Capital

 

I used ZenLedger to get my crypto taxes organized and done. It was very smooth and easy to do.  Jas Gill - CEO/Co-founder of BeeBack.io

 

I used ZenLedger a couple days before the tax deadline and they saved me. I gave their CEO a hug.  Zane Witherspoon - CTO of Dispatch Labs

 

I restated my taxes from 2013 using ZenLedger and found $235,000 in overpayment to the IRS.  Luke Riddle - Employee #30 at Coinbase

 

I think your company is going to ride a tsunami wave of success with your software.  Without it, doing taxes is impossible.  b************1@gmail.com

 

I will be a lifetime member to ZL. Most of the others in our 14 member investment group are techies and we all use ZL. Myself and my dad, are the weak link. your team and product saved us. Toast to you.  c***********s@hotmail.com

 

Yes! I never thought I’d be so happy to see 47k in losses! I just bought the premium plan and will recommend your software to others. Thanks for the help!  j**********e@gmail.com

I thought I had a handle on my limited crypto trading for 2018, but I was wrong. ZenLedger gave me a valuable education in what is really required for tax reporting and made it very easy to gather the necessary records. The software did all of the work from there. I highly recommend this product.  Chris H.

Are you done talking with bots?  ZenLedger understands that everyone’s comfort level and knowledge base is different.  Their customer service is personal in nature and the most over-looked benefit, in my opinion.  You can communicate by email, Intercom Widget, or you can schedule a phone call.  They know taxes are intimidating, confusing and high-risk. Making mistakes could mean an audit, fines or penalties. Their team is online all day (and often at night) to make sure you don’t get stuck, and to help with anything you might need as you prepare to file your crypto tax forms.  

When I checked out the competition, none offered this level of support.  Additionally, the response time by the ZenLedger team is super fast compared to other services.  In fact, I remember doing my taxes on a Sunday in 2018 and I sent off a request and I heard back from Pat Larsen, the CEO of the company within 10 minutes.  That's great service in my book.

You can open a free account and will have full access to ZenLedger's features.  However, to print the IRS forms you'll need, there is a cost, which is very reasonable given the reduction in stress you'll experience.  It's tiered based on the number of transactions.  Once you open your free account, and are ready to print your forms, you can save 20% up until April 15, 2020 by using Discount Code: WEBINAR20.

Are you done talking with bots?  ZenLedger understands that everyone’s comfort level and knowledge base is different.  Their customer service is personal in nature and the most over-looked benefit, in my opinion.  You can communicate by email, Intercom Widget, or you can schedule a phone call.  They know taxes are intimidating, confusing and high-risk. Making mistakes could mean an audit, fines or penalties. Their team is online all day (and often at night) to make sure you don’t get stuck, and to help with anything you might need as you prepare to file your crypto tax forms.  

When I checked out the competition, none offered this level of support.  Additionally, the response time by the ZenLedger team is super fast compared to other services.  In fact, I remember doing my taxes on a Sunday in 2018 and I sent off a request and I heard back from Pat Larsen, the CEO of the company within 10 minutes.  That's great service in my book.

You can open a free account and will have full access to ZenLedger's features.  However, to print the IRS forms you'll need, there is a cost, which is very reasonable given the reduction in stress you'll experience.  It's tiered based on the number of transactions.  Once you open your free account, and are ready to print your forms, you can save 20% up until April 15, 2020 by using Discount Code: WEBINAR20.

ZenLedger 24/7 customer support.

ZenLedger 24/7 customer support.

Won't it be nice to know your tax returns are done right the first time?

Won't it be nice to know your tax returns are done right the first time?

Why stress out over the IRS' crypto tax requirements?

Why stress out over the IRS' crypto tax requirements?

Crypto tax tips for CPA's and bitcoin tax software anyone can use.

Crypto tax tips for CPA's and bitcoin tax software anyone can use.

Digital Asset News

Digital Asset News

March 26, 2020 by Lou Zebedeo, 

Investor, Blogger, Dean Witter Broker quondam

March 26, 2020 by Lou Zebedeo, 

Investor, Blogger, Dean Witter Broker quondam

Copyright © 2019. Digital Solutions Advisor

Copyright © 2019. Digital Solutions Advisor

Crypto Info Wire

Crypto Info Wire

It's never too early or too late to start on your crypto tax returns.

Learn how to eliminate the stress when filing your crypto returns with the IRS.

It's never too early or too late to start on your crypto tax returns.

Learn how to eliminate the stress when filing your crypto returns with the IRS.

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