Skip to the content
Call Us
  • What We Do
    • Crypto Tax Preparation
    • Tax Loss Harvesting
  • Pricing
  • About Us
  • Insights
    • News
    • Education
    • Guides
    • Impermanent Loss Calculator
  • Contact
Menu
  • What We Do
    • Crypto Tax Preparation
    • Tax Loss Harvesting
  • Pricing
  • About Us
  • Insights
    • News
    • Education
    • Guides
    • Impermanent Loss Calculator
  • Contact
Get Started

Tech 4 Accountants: Crypto Tax Prep: A Game-Changer for Accounting Firms

  • TJ Tate
  • April 4, 2024

Share This Post

In a recent episode of the Tech Talk for Accountants Show, host Andrew Leiss sat down with Brian Ernest and Mike Ring, co-founders of Blockchain Crypto Tax Prep, to discuss the evolving landscape of cryptocurrency taxation and its implications for accountants and taxpayers. With tax season in full swing, this timely conversation shed light on how to handle crypto transactions for tax compliance.

The Growing Challenge of Crypto Taxation

As cryptocurrency adoption grows, so does the complexity of tax reporting. Brian and Mike highlighted the dramatic shift in the crypto market over the past decade, from a niche investment in Bitcoin to a landscape filled with thousands of coins and countless transactions. This transformation has made it increasingly difficult for individuals and accountants to accurately track and report crypto activity.

Key challenges include:

  • Centralized vs. Self-Custody Wallets: Centralized exchanges like Coinbase provide some transaction reports, but they are often incomplete or inaccurate. On the other hand, self-custody wallets require meticulous tracking since no standardized reporting exists.
  • Cost Basis Gaps: Moving assets between platforms often leads to loss of cost basis information, complicating accurate tax calculations.
  • Audits on the Rise: The IRS has ramped up enforcement, frequently auditing taxpayers for discrepancies in reported crypto transactions.

Bridging the Gap: Blockchain Crypto Tax Prep’s Role

Blockchain Crypto Tax Prep specializes in preparing Form 8949, which details short- and long-term gains and losses from cryptocurrency transactions. Unlike traditional CPA firms, they focus exclusively on crypto tax preparation and partner with accountants to fill this niche gap.

Their process involves:

  1. Identifying all platforms, wallets, and exchanges a client has used.
  2. Consolidating and reconciling transactions across centralized and self-custody systems.
  3. Providing accountants with a detailed and accurate 8949 form for filing.

Insights for Accountants and Taxpayers

The discussion underscored the importance of proactive tax planning in the crypto space:

  • Understanding Taxable Events: Many crypto users mistakenly believe taxes are only due when cashing out to fiat currency. In reality, activities like staking, token swaps, and crypto-to-crypto trades are taxable.
  • Software Limitations: Despite advancements, crypto tax software is far from perfect. Data imports from exchanges often require manual adjustments due to inconsistent formats.
  • IRS Focus on Crypto: With new regulations and mandatory reporting requirements on the horizon, the IRS is prioritizing compliance in the crypto sector. The upcoming 1099-DA form is expected to increase scrutiny but may also create challenges due to incomplete cost basis reporting.

Looking Ahead

The conversation also touched on the future of crypto reporting. While the blockchain itself offers transparency, the lack of standardization among exchanges and wallets complicates tax compliance. Brian and Mike expressed skepticism about the near-term feasibility of unified reporting standards but emphasized the critical need for individuals and accountants to stay informed.

Learn More

For accountants grappling with crypto tax challenges, Blockchain Crypto Tax Prep offers tailored solutions and free consultations.

For expert assistance in managing your crypto tax obligations and to experience the peace of mind that comes with precise tax filing, don’t forget to explore our cutting-edge crypto tax preparation service. Your financial clarity and confidence start here.

Your subscription could not be saved. Please try again.
You're in. Welcome to Macro Degen—your inbox just got smarter.

Get the Macro Degen Newsletter

Unfiltered crypto insights, market chaos, and sharp takes—straight to your inbox.

More To Explore

Yield Farming Vs Staking
Guides

Yield Farming vs Staking

May 14, 2025
Is Staking Crypto Worth It?
Guides

Is Staking Crypto Worth It?

May 14, 2025

Start simplifying your crypto tax preparation today!

drop us a line and keep in touch

Schedule A Call
  • 410-320-7348
  • info@cryptotaxprep.io
  • 175 Admiral Cochrane Dr Suite 404B, Annapolis, MD 21401, United States
  • Monday–Friday 9:00 am– 4:00 pm
  • FAQs
  • Contact Us
  • Terms & Conditions
  • Privacy Policy
  • Disclaimer
  • Affiliate Program
Facebook Twitter Linkedin Youtube
Your subscription could not be saved. Please try again.
You're in. Welcome to Macro Degen—your inbox just got smarter.

Get the Macro Degen Newsletter

Unfiltered crypto insights, market chaos, and sharp takes—straight to your inbox.

© All rights reserved

Twitter Facebook Dribbble Youtube Pinterest Medium