We're here to help with your bitcoin tax questions
Yes, if you are a United States citizen, cryptocurrency transactions are taxable and are treated as property. For 2020 tax filings the IRS has even added this question to the top of Form 1040. “At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?” It is imperative that you file cryptocurrency taxes to stay compliant.
The IRS is actively targeting individuals who are using cryptocurrency for tax evasion or who are not paying their cryptocurrency capital gains for audits. By ensuring that you file and pay crypto taxes correctly, you can avoid fines and penalties in the event of an audit.
A taxable event is typically a sale or disposition of an asset. In crypto, a taxable event occurs when a coin is traded for cash (also known as fiat) or another cryptocurrency, or when cryptocurrency is used to purchase goods or services. Transferring currency from one exchange to another (i.e., moving BTC from Coinbase to Bittrex) is not a taxable event. Converting one currency to another (BTC to ETH to an ICO) is considered a taxable event. It’s also now forbidden to try to 1031 exchange your ICO holdings. Consult your tax professional as you make these decisions to decide how aggressive or conservative you wish to be.
We don’t do your taxes, but we aggregate all of your exchange and wallet data together to make it easy for you or your tax professional to generate the tax forms you need. Your tax professional can even view and edit your account in ZenLedger at no cost. We also offer tax professional plans where a ZenLedger preferred tax professional will handle your crypto and non-crypto taxes from start to finish.
ZenLedger current supports over 400+ exchanges, 7000 token types, 20+ DeFi protocols and all wallets. We are also racing to integrate additional exchanges, wallets, blockchains and protocols daily, and will soon have support for NFTs. ZenLedger is global and can be used by anyone in the world that is using multiple ledgers and would like those transactions easily aggregated and cleaned up into a readable format. Whether it is US Dollars, Euro, Japanese Yen, British Pound, we are working to support all global currencies and will soon support global tax forms as well.
We always advise investors to import all transactions and tokens for full compliance and tax accuracy.
You can make changes to your account settings by logging in and clicking on My Account in the upper right corner of the screen. Once you are in the account, you can make changes to the following: Profile Settings | Email Address | Password | Your Tax Answers | Notifications | Plans | Payment Information | Billing History | Other (Delete Account) | Clear All Transaction
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