If you’re one among the 16% of Americans who bought, sold, or exchanged cryptocurrencies last year, you’re definitely worried about the April 18th deadline for filing your taxes. And if you’re an NFT devotee who altered your Twitter profile photo to a hexagonal, casual monkey, you’ll probably need some help when it comes to filing. The Internal Revenue Service in the United States is expected to investigate, if not audit, anyone who used virtual money this year. Alex Roytenberg, also known as @TheNFTCPA on Twitter, told TechCrunch.
“I believe the IRS was anticipating a large year of wealth and income generation, and 2021 was unquestionably that year,” Roytenberg said. Because there is no explicit advice from US regulators on how to file taxes on diverse crypto goods, he continued, the process requires the taxpayer to understand how existing regulations meant to control traditional assets may apply to whole new technology.
Roytenberg, a certified public accountant, has approximately 20 years of experience as a tax accountant, having worked for Morgan Stanley, Goldman Sachs, and PwC. Roytenberg initially became acquainted with the web3 field in 2018 when counseling a number of Coinbase workers. Since then, he has worked to expand his expertise, co-authoring the “NFT Tax Guide” and presenting at industry events like as NFT.NYC.
While Roytenberg advises crypto traders to seek expert, one-on-one tax guidance to clarify any ambiguities, he also spoke with TechCrunch about a variety of crypto tax prep programs that may be beneficial this year. Here’s a breakdown of some of the most popular crypto tax filing tools currently available.
If the Bitcoin world resembles a plate of succulent, tender, blistering hot chicken wings, taxes are the sad-looking celery sticks on the side. Nobody wants them there, yet they’re an unavoidable part of the deal. Maybe you spotted this delectable mound of meat and immediately dived in. You tried a few cryptocurrencies, a few of NFTs, and a huge chunk of DeFi. You finally came up for air, your face smeared with sauce, and it was only then that you saw the celery had been sitting there all along. In fact, it now covers half of the plate.
Oh, and you could go to jail if you don’t eat all of your celery. Greetings and welcome to the NFT Tax Guide! We’re going to cover a lot of ground, so be prepared. So take a drink, kick back, and prepare to discover everything you’ve always (or never?) wanted to know about cryptocurrency taxes.