E&Y LLP has launched a Tax Calculator Solution to manage the increase in tax audits that target individual’s trading in cryptocurrencies. The decision intends to fix the tax difficulty as it produces several filing formats that the IRS often needs. The solution is the most recent addition to the Ernst & Young blockchain Analyzer product suite, which calculates capital gains for several crypto transactions. The new Tax Calculator is a SaaS (software as a service) application. It will simplify the process for U.S. tax filings for people who own crypto and want to report it on their U.S. tax returns.
Moreover, the E&Y Tax calculator discusses the crypto consumers’ reporting requirements in the tax season, which started in January. The Tax Calculator imports crypto transactions from various major crypto coins and exchanges. It offers a transparent view of all transactions by exchanges, years, and kind of transaction. Besides, the tool automatically determines a user’s capital gains and losses, analyzing the process of calculating tax returns and creating a draft Form 8949 on sales and dispositions of capital assets for individuals to study and file.
IRS considers Crypto Assets as property instead of currency
Currently, multiple reports have emerged from tax authorities clasping and going after traders under-reporting their crypto profits. The IRS also mailed letters to taxpayers who might have declined to state income and pay the resulting tax from cryptocurrency transactions. Moreover, the Internal Revenue System (IRS) still considers crypto assets as property rather than currency for income tax purposes. This indicates the authority will assess crypto profits and losses like those for stocks at capital gains rates. The Internal Revenue Service has attached a question to the standard 1040 form: America’s primary income tax form. Moreover, the compliance measures come in the state of a checkbox requiring taxpayers to reveal their trade-in cryptocurrencies in 2020.
Apart from E&Y, Crypto.com also recently advocated the launch of a crypto tax calculator. However, the Crypto.com tax service is currently only accessible in Canada but will soon be available in other markets. It was developed with expert tax advisors’ guidance to assure stringent adherence to and compliance with public laws to file crypto tax. The service is entirely free. The easy-to-use service has country-specific tax estimation formulas. This makes the tiresome and challenging task of crypto tax calculation and filing a lot easier.
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