How Advanced Crypto Tax Reconciliation Can Help

Zac McClureUpdated at: Aug 31st, 2021

Advanced crypto tax reconciliation

In order to accurately calculate your cryptocurrency taxes, you need to be able to gather all of your crypto trade data. 

But perhaps you have a complex trading history, or you are missing data from shutdown exchanges and platforms. After all, cryptocurrency is a huge, complex ecosystem. 

Luckily, the team at TokenTax is equipped to handle any of these situations, including (but not limited) to:

  • Lost or inaccessible exchange trading history

  • Missing cost basis (the price of which you acquired crypto you later sold/traded away)

  • Worthless and/or illiquid ICO tokens

  • Margin trading calculation trouble

  • High transaction count reconciliation

  • Interpreting transaction reports from exchanges

  • Incorrect results from other tax platforms

These are the edge cases in which TokenTax shines. We are confident that we can help you figure out all of those tricky situations and give you peace of mind. Let’s discuss some of the scenarios mentioned above.

Lost or inaccessible exchange trading history

At TokenTax, we help our VIP clients with special situations like missing transaction data. If you lost coins due to an exchange hack or shutdown, there will be a gap in your crypto transactions that you will need to reconcile somehow for tax purposes. We can help you reconcile these. Our accountants can help create “synthetic” trades to fill in missing cost-basis. 

On a high-level, these are done in a conservative manner, so it can pass IRS scrutiny. And you’ll have a complete set of crypto transactions without any gaps in cost-basis.

Worthless and/or illiquid ICO tokens

Unfortunately, not every year is not kind to ICOs. If you bought a lot of tokens from an ICO and now there is no liquidity for you to sell it, we can help. Ideally, you will need to find a way to dispose of these tokens, because if you just continue to hold those ICO tokens, you will never be able to realize the loss and use it to offset your ordinary income (wages, capital gains, etc.).

High frequency traders

Some of you are more experienced traders and may have used bots to execute thousands of trades or margin traded on various platforms. If so, your situation definitely requires more care, and we can help.

We can handle millions of trades easily. Our accountants split your trades into chunks and process them separately to ensure that your cost bases are all accurate. We’ve worked with clients with thousands/millions of trades, so we are well equipped to help you out this year too.

Margin trading

Margin trading is another beast that we are well experienced at tackling. Many customers who have traded with margin on Poloniex, Bitmex, or Kraken had huge headaches trying to figure out how to calculate their crypto taxes using existing crypto tax sites/software. 

However, our support team is able to get missing data from exchanges and solve cases involving margin that no other crypto tax company could figure out (and we’re proud of it).

Different results from different crypto tax sites

Some of our customers tried us out after paying for a few other sites like Bitcoin.Tax, CoinTracking, ZenLedger, etc. and realized that they all give different results even with the same data input. This definitely is not good for your peace of mind if you’re trying to make sure your results are accurate and will withstand a potential tax audit.

That is something our customer support team can help with as well. Just give us your 8949 output forms from the other tax sites and we’ll dig into them, reverse-engineer transactions, and pinpoint exactly where the variances are. That’s how flexible our software is and how much we care about giving you confidence in our results.

Those are just some of the edge cases that we can handle. Of course if you’re just looking for an accurate software and an available support team, then we’d love to help you with any other scenario you may have. 

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