{"id":152,"date":"2022-05-20T03:36:58","date_gmt":"2022-05-20T03:36:58","guid":{"rendered":"https:\/\/flux.la\/?p=152"},"modified":"2022-05-26T02:22:48","modified_gmt":"2022-05-26T02:22:48","slug":"want-to-simplify-filing-bitcoin-taxes-read-this","status":"publish","type":"post","link":"https:\/\/flux.la\/want-to-simplify-filing-bitcoin-taxes-read-this\/","title":{"rendered":"Want to Simplify Filing Bitcoin Taxes? Read this"},"content":{"rendered":"\n
Bitcoin is popularly known as the first cryptocurrency to grace the market over a decade ago in 2009. It was created by an individual or group of individuals under the pseudonymous name of Satoshi Nakamato. To this day, Nakamato’s real identity seems to be under wraps. Balances are recorded using a public ledger. <\/p>\n\n\n\n
Bitcoin employs a network of computers to authorize transactions, and as a result, ensures they are accurate and completely secure. Blockchain is the underlying technology that powers Bitcoin is a sort of distributed ledger. The world of Bitcoin, Bitcoin tax software, cryptocurrencies, and so forth is vast. However, these are some of the fundamentals you ought to be aware of: <\/p>\n\n\n\n
Before getting to the best Bitcoin tax software<\/a>, here are some exciting features of Bitcoin that set them apart from fiat currencies like the U.S. Dollar (USD): <\/p>\n\n\n\n This happens to be one of Bitcoin’s primary features. Bitcoin is based on a decentralized system. Since Bitcoin uses a cluster of computers to secure and authorize transactions, there is no single point of control, which means that there is a low chance of catastrophic system failure. If there is a failure somewhere within the system, it can be remedied. <\/p>\n\n\n\n As mentioned earlier, Bitcoin works on Blockchain networks. Blockchain is known to be a public ledger that stores all legitimate transactions that are carried out between users. Anyone on the network may access this ledger to view the transactions that are carried out, thereby ensuring complete transparency.<\/p>\n\n\n\n Bitcoin transactions are incredibly fast. You can transfer bitcoins in a matter of seconds in the network, which is not the case with regular banks that typically take a few days to complete transactions. <\/p>\n\n\n\n The Internal Revenue Service (IRS) has deemed cryptocurrencies to be property for tax purposes. In other words, gains made from Bitcoin transactions will be considered capital gains. If you purchase a Bitcoin using fiat currencies such as the U.S. Dollar, it is not a taxable event. However, if you use Bitcoins to buy something, it is considered to be a sale of property, which is a taxable event. <\/p>\n\n\n\n If you hold your Bitcoin for less than 12 months before selling it, the gains you make will be considered short-term gains. However, if you hold the Bitcoin for more than a year before you use it for transactions, you will have to pay long-term capital gains<\/a>. Long-term capital gains generally have a lower tax rate than short-term capital gains. <\/p>\n\n\n\n Regardless of your experience as a crypto trader, calculating your crypto taxes can be a cumbersome task. It is tedious because you will have to record the price of the Bitcoin at the time of purchase and when you sell it. Additionally, you will need to know how long you have held each Bitcoin, and this can be particularly challenging if you are carrying out hundreds of transactions. <\/p>\n\n\n\n Considering how complicated the process is, crypto companies have developed a variety of Bitcoin tax software to simplify the process of calculating the tax you are liable to pay on your Bitcoin within minutes. There are a plethora of Bitcoin tax software to choose from. Here is our list of the best ones out there: <\/p>\n\n\n\nDecentralized System<\/h3>\n\n\n\n
Transparency<\/h3>\n\n\n\n
Instantaneous<\/h3>\n\n\n\n
How does Bitcoin Tax work?<\/h2>\n\n\n\n
The Bitcoin Tax Software you ought to know about<\/h2>\n\n\n\n
CoinTracker<\/h3>\n\n\n\n