Keeping track of all your transactions and trades over the exchange is a very strenuous process, and it gets even more difficult when you have more than one exchange to sort your trades, deposits and other transactions for say, calculating your profit and loss, reporting for taxes and so on. That’s where crypto tax software comes in, which makes life a lot easier.
What are crypto tax software?
A crypto tax software is nothing but a third party calculator which reconciles all your transactions and trades from various exchanges via API (Application Programming Interface) to give the detailed profit and loss statement according to the IRS regulations.
There are a few best crypto tax software out there, and you just need to look for what suits the best according to your requirements. Today we will discuss one of our favorties and the leading crypto tax software Cointracking.
What makes Cointracking one of the leading crypto tax software
Cointracking allows users to import your data from a wide range of exchanges. Currently it offers 39 APIs, 38 CSV and 13 legacy CSV Imports. They constantly add new exchanges to their list based on user requests. Bitcoin.de API and Celcisus CSV have been the recent additions to the list. And they have their platform up to date with the countries tax forms and guidelines (Tax form 8949).
Cointracking allows FIFO and LIFO and many more tax calculation procedures. They have recently included Fbar.
Established in 2013, It has over half a million users so far.
Supported Exchanges and Wallets.
Cointracking supports most of the leading exchanges such as Binance, Bittrex, Kucoin, Huobi, Localbitcoins, Bibox, Bithumb and many more. For the rest of the wallets and exchanges, you can simply upload your downloaded CSV files.
Tax-Report for Bitcoins and other Digital Currencies
It provides tax reports for bitcoin and other cryptocurrencies in either LIFO, FIFO or other tax calculating methods as per their countries tax regulations, form 8949, statements and more.
This tool also helps you in making sure of your gains and losses and the stolen or lost tokens, so that you report exact profits and losses.
How to get started with Cointracking?
As a beginner you can create a free account if you have a high volume of transactions.To get going signup here.
Once signed up, all you need to do is to log into your exchange and either download the CSV and add the coins manually or enable API which is very swift.
With API, cointracking can easily track all your transactions up to date. Dont forget to choose read only mode while setting up your API.
How to set up API with Cointracking.
Let us consider using binance to add API to Cointracking. Login into your binance exchange, under the account you will find API Management.
Click create after labeling your API. A prompt for additional security is provided. Go through these security steps and then you will be asked to confirm the API creating by email.
Once confirmed, you will be taken to the API page where you need to edit and make sure you are only ticking the Read only and uncheck trading and withdrawals and then click save.
Now that you have successfully created the API Key. Lets move to cointracking to add the API.
On the dashboard, click Enter coins and then select Exchange Imports(API) and then the exchange you like to integrate. In this scenario we choose Binance.
Copy and paste the API and Secret Key we just created on Binance and click save job.
Once done your dashboard will display all the information regarding your transactions.
This process works very similar to all the exchanges. You can also manually upload the CSV documents.
- Make sure you uncheck the trades and withdrawals while saving the API.
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Comparing the BEST Cryptocurrency tax software [Updated for 2020]
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