Yes. You heard it Right. You will need to pay your taxes on Cryptocurrency gains.
I am not sure if many are thinking about this right now but when you finally want to do this, it can be a Herculean task. Looks like Cointracking has you covered here.
With ability to configure various parameters for your tax reports I think this feature from Cointracking can come handy.
You can calculate your taxes using any of the following methods. FIFO, LIFO, HIFO and LOFO,
HIFO - Highest in First Out
LOFO - Low Cost First Out
HPFO - Highest-Price First-Out
LPFO - Lowest-Price First-Out
HAFO - Highest-Amount First-Out
LAFO - Lowest-Amount First-Out
It would be great if Cointracking also adds Loss/Gain Utilization (LGUT), Specific Lot Identification (SLID), Average Cost (ACST) and Single Account Average Cost (SAAC) methods as well.
As you can see from the image you can configure the following parameters.
- One of the methods from the above list.
- Percentage of taxes for short term and long term.
- Number of days after which trades are considered long term.
You can create multiple reports based on these settings and store them in your account. Considering that you can import all your trades from different exchanges, add manual trades to account for the differences and ability to create reports I feel Cointracking worth every penny we for it.
If you are planning to use this portfolio manager use this referral link Cointracking to get a 10% discount and don't miss out on the additional 5% discount if you use Bitcoin for payments.
If you have come across any other portfolio manager do let me know so that I can take a dig at it.