Crypto Tax Calculator, a tax computing software designed for crypto users, recently completed the integration of its services with FTX cryptocurrency exchange. The integration will enable FTX traders to reconcile their crypto taxes without much hustle amid the ongoing crackdown by tax authorities across the globe.
Recent months have seen tax authorities such as the U.S Internal Revenue Service (IRS) intensify their efforts in catching crypto tax evaders. Some of the actions taken by the IRS include sending ‘John Doe’ summons to large crypto firms and exchanges such as Circle and Coinbase. The IRS also requested $32 million in its 2022 fiscal budget for the sole purpose of strengthening crypto tax enforcement.
Notably, it is not only the U.S. where tax authorities are cracking the whip on crypto investors and traders. Asian giants like South Korea are in the process of introducing taxes on crypto assets. The country is set to push forward with its proposed tax regime where crypto assets will be taxed as intangible property. South Korea’s Minister of Finance, Hong Nam-ki, previously confirmed to Reuters that,
“It’s inevitable, we will need to impose taxes on gains from trading of virtual assets,”
Solving the Crypto Tax Reporting Nightmare
The crypto ecosystem is a relatively new niche where most participants are still figuring out their way around. One of the biggest nightmares in this industry is tax reporting, as most jurisdictions are yet to define crypto-asset tax regimes. This cumbersome process has discouraged many people from investing in crypto while others forego their obligation to file taxes on crypto gains.
It appears there is some relief for both groups following the innovation of software such as Crypto Tax Calculator. This tax reporting service will now enable FTX users to leverage its reporting functionalities. Some of the services offered include an automatic categorization of transactions. Users are only required to key in or integrate data feeds, leaving the tax calculator to sort out the rest.
Furthermore, the crypto tax calculator can generate financial reports that date back to 2013. These accountant-friendly reports reduce the work of crypto users and accountants, given that they are easily understandable. Notably, the crypto tax calculator’s services support 21 tax jurisdictions, including the U.K, U.S., and Canada, amongst others.
The platform also features direct CSV and APIs to facilitate the integration of data feeds from the crypto ecosystem. Other prominent exchanges supported by the crypto tax calculator service include Coinbase, Binance, and Bitfinex.
Cryptocurrencies have a massive potential of growing into the future of financial ecosystems. However, this nascent industry has to toe the line by complying with local and global tax regimes. Platforms such as crypto tax calculators are making it more straightforward for crypto stakeholders to be tax compliant, creating an environment that collaborates with authorities like the U.S IRS and other tax authorities.