Filing taxes pertaining to Bitcoin and other cryptocurrencies remains a very big problem for a lot of people. While some interesting tools exist, the process needs to be made easier and more straightforward. Taxbit can be a very helpful tool in this regard, although it may not be for everyone.
The Idea Behind Taxbit
On the surface, Taxbit is designed to make filing taxes associated with Bitcoin and various altcoins a lot more straightforward. Its tax engine will let you “view the real-time tax impact of all your crypto transactions”. That is certainly a very different take on things, and one that can offer a degree of convenience which other tools do not provide at this time.
How Does it Work?
Having the ability to gauge the real-time tax impact of one’s cryptocurrency transactions is a big deal. One of the bigger problems users deal with right now is determining the values of prior transactions and how they impact their tax filings. By having a tool which constantly monitors transactions in real time, a lot of the challenges are removed from the equation.
Interestingly enough, Taxbit claims its tax engine will support transactions involving any cryptocurrency or fiat currency in the world. Thanks to its algorithm, it can quickly determine the cost basis, gains or losses, and taxes associated with every trade. Its dashboard will provide users with a detailed overview of all aspects of their cryptocurrency trading behavior.
Moreover, Taxbit will also let users automatically withhold taxes throughout the year. As such, users will be prepared for their tax filings and be able to pay the associated funds without any major problems. It sounds like a very convenient solution, although it remains to be seen if it will work as advertised when it gets officially released. For now, the project is still in early access, with no official release date as of now.
The Road Ahead
Based on the current pricing structure for TaxBit, it seems the project may very well be worth the money – assuming, that is, that all of the promised features work as advertised. Various exchanges and wallets are currently being added, and users can request support for specific exchanges as well. It is evident this service will primarily be useful for US residents, although there is a plan to incorporate international tax law as well.