Deribit Teams Up with CryptoTaxCalculator to Simplify Tax Season
Cryptocurrency futures exchange Deribit has revealed its latest partner – Sydney-based software specialist CryptoTaxCalculator. The user-friendly crypto tax calculator has been designed to help users work out their liability from options and margins trading.
Deribit traders who are quick off the mark can also obtain a 40% discount on CryptoTaxCalculator by using the code DERIBIT_40, which is valid until May 23. The US tax deadline, of course, is May 17.
CryptoTaxCalculator offers four subscription-based plans, with the cheapest, Rookie, coming in at $49 per annum and the highest tier, Trader, costing $299. The difference in price points mostly relates to transaction number, with the Rookie Package supporting up to 100 and Trader supporting 100,000.
CryptoTaxCalculator, which supports over one hundred exchanges as well as non-exchange activities like staking, mining and airdrops, was launched in 2018 to help users better manage their tax affairs. The partnership with Deribit means that traders can now import their transaction data directly from the futures and options exchange to gauge their liability for capital gains and income tax.
The software’s automated categorization algorithm helps batch transactions and make trading activity easy to review and audit.
With a calculator handling the heavy lifting, sorting transactions and determining realized profit and income, users can quickly generate the relevant reports to send to their accountant while maintaining thorough records for audit purposes.
CryptoTaxCalculator connects to exchange data via an Application Programming Interface (API) or Comma Separated Values (CSV) files, and Deribit users who also have accounts with other exchanges can pull transaction data from multiple platforms and chains to calculate their liability. As well as cryptocurrencies like bitcoin (BTC) and ether (ETH), non-fungible tokens (NFTs) are also supported.
In the US, the Internal Revenue Service (IRS) treats cryptocurrencies as securities, with capital gains related to the sale or trade of one asset for another deemed taxable income. Simply purchasing and holding onto a digital asset, however, is not taxable.
In recent years, national tax authorities have been getting tough on crypto users who fail to file tax returns detailing their activity in the blockchain world. In fact, they have even petitioned major cryptocurrency exchanges to hand over data on users in a bid to identify tax evaders.
The IRS, meanwhile, now routinely asks taxpayers whether they “received, sold, sent, exchanged or otherwise acquired any financial interest in any digital currency.”
In March, a court in Japan sentenced a crypto tax evader to one year in prison plus a $200,000 fine for violating income tax law. The man had failed to submit accurate tax declarations relating to his bitcoin trading activity during 2017-18.