2021 is the year that cryptocurrency hit the mainstream — it’s now estimated that 17% of Americans own cryptocurrency. Unfortunately, filing crypto taxes is still as challenging as ever for investors.
Because many cryptocurrency investors engage with multiple wallets, exchanges, and decentralized protocols, it’s often difficult for them to find the information they need to file an accurate tax return.
Luckily, cryptocurrency enthusiasts looking to file their tax returns do have a way to simplify the process.
CoinLedger has built a crypto tax platform that’s designed to make filing crypto taxes feel stress-free. We caught up with David Kemmerer, CEO of CoinLedger, to learn more about how his company is serving crypto investors all across the world.
Can you give us a brief overview of CoinLedger and what it does?
CoinLedger is a crypto tax software company that serves more than 100,000 customers all across the globe. We’ve been helping crypto investors file their taxes and track their crypto portfolios since 2017.
What inspired your team to get started with CoinLedger?
I got started with cryptocurrency trading back in 2017. At the time, I was doing thousands of transactions on a monthly basis.
Soon, I realized I had a big problem. I had no idea how I was going to report my taxes.
Because of the sheer number of transactions I was doing, it was almost impossible for me to keep track of all of them on a single spreadsheet.
I turned to Reddit to find out if there was some kind of platform that could solve my problem. At the time, there weren’t any resources available for investors like me who felt lost when it came to reporting their crypto gains and losses to the IRS.
Reddit couldn’t help me figure out how to file my taxes. However, Reddit did help me get connected with two very smart guys who were working to solve the crypto tax problem. They became my co-founders at CoinLedger. And the rest is history.
Why do crypto investors need a tax solution?
For most crypto investors, using a crypto tax platform is essential. After all, most investors experiment with multiple wallets, exchanges, and decentralized protocols.
If your tokens are spread out across multiple locations, it’s difficult to keep track of all your transactions within a spreadsheet. It’s too much manual work and the chance of missing a transaction is too high.
That’s where CoinLedger comes in. We have integrations with dozens of popular crypto applications such as Coinbase, Gemini, and Kraken, so that investors can record their transactions and file their taxes in minutes.
If an investor has hundreds of trades on one of these applications, they don’t need to manually log each of these transactions. They can connect their accounts for these exchanges to CoinLedger with just a few clicks and then file their tax return. Most of the time, the whole process can be completed in less than half an hour.
Can you tell us more about how these integrations work?
Once a customer sets up an integration with an application they are using, they can easily sync any new transactions that take place with their CoinLedger account. That means it’s easier than ever to report this data to the IRS when tax season rolls around.
Of course, cryptocurrency is a fast-moving space, and many investors engage with new exchanges and new decentralized protocols on a regular basis.
Our team works constantly to build new integrations with our platform. We also support the ability to manually upload transactions through a CSV file. Our team has worked to make this process as seamless and stress-free as possible.
Can CoinLedger help investors reduce their tax bill?
While there’s no way to avoid taxes, our product can help investors minimize their tax bill by helping them to easily identify tax-loss harvesting opportunities.
In case someone in your audience is not familiar with what tax loss harvesting is, it’s a well-known tax reduction strategy that’s quite common in the equities space. Investors can sell their capital assets at a loss to reduce their tax burden for the year.
Crypto actually has an advantage over other asset classes here. Currently, stocks are subject to a ‘wash sale rule’, which states that you cannot claim a capital loss on a stock if you buy it back within 30 days of the sale. Currently, this rule does not apply to cryptocurrencies.
Of course, taking advantage of cryptocurrency tax-loss harvesting comes with its own challenges.
Sometimes, it can be hard to identify tax-loss harvesting opportunities. Often, investors can’t even tell when the tokens they’re holding are trading at a lower price than when they bought them.
CoinLedger can help. Within the platform, customers can see all of their tax-loss harvesting opportunities at a glance and take immediate action.
This feature has led to awesome results for our customers! Some of them have saved thousands of dollars on their tax bill with tax-loss harvesting.
What makes CoinLedger’s tax product so special?
We know that filing taxes is a stressful experience for most people. The problem is amplified with cryptocurrency, where investors have to deal with confusing and sometimes nonexistent guidelines.
Here at CoinLedger, we’ve built a platform that’s designed to reduce the stress of filing crypto taxes as much as possible.
We have set the gold standard in the industry when it comes to ease of use. In third-party reviews, our customers consistently praise our platform as being incredibly user-friendly. We’ve also built a world-class support team that consistently provides quick responses to all of our customers, whether they have 3 crypto transactions on the year or 3000.
Unfortunately, other tax platforms simply don’t offer the kind of customer support that we do. We’ve heard multiple customers talk about using one of our competitors and waiting days for a response to a simple support question. They realized that wasn’t good enough for them and decided to switch to CoinLedger.
Where can I find more information about CoinLedger?
To learn more about our product, you can visit our website at CoinLedger. You can also get started right away with a free preview report.
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