Cost of Crypto Tax Preparation 

Cryptocurrencies are unique, and many accountants do not have the experience of dealing with them.   

The most cost-effective way to account for your crypto is to use third-party software, such as Koinly, which we have partnered with and is included in your tax prep fees with us. Here you upload your trades, airdrops, forks, staking income, etc., directly from your crypto exchanges. You can invite your tax preparer to access the account so they can pull the necessary data needed to complete your tax return.

Please note that each software is different and has its own unique quirks for fixing missing cost basis data. This is usually a result of missing data from exchanges that have not been uploaded, including unused basis from previous years. As a word of advice for anyone trading crypto, we recommend uploading CSV files rather than APIs, as you will have a record to reconcile with the reports the software generates. Since we are accountants, not technical support for the various crypto software companies, you will need to reach out to the respective technical support of the software company you are using.

Many people do not wish to use third-party software, which is fine. Still, they will end up paying an hourly bookkeeping fee of $175, which requires an upfront retainer of $2,000 and a longer wait for the completion of their tax returns, as it is very time-consuming when you are working with thousands of trades through several different exchanges.

COMMON COIN ISSUES WE WILL RESOLVE & REPORT CORRECTLY ON YOUR 1040  

• Reporting the correct amount of Capital Gains and Capital Losses

• Coin-to-Currency Trades

• Coin-to-Coin Trades

• Coin Hard Forks

• Deducting Coin-Trading Costs

• Purchasing Goods and Services with Coins

Example of a common crypto question:  

I bought a bitcoin and turned around and sold it to buy ripple. I bought it for 10k and then sold it for 10k to get the ripple. Is this still a tax event but with a zero gain/loss? I would argue I had some kind gain or loss cause of how it bitcoins fluctuates but I am not sure. 

Answer:

It is still a taxable event and you should report it on Form 8949. The tax will calculate to $0 but you will be in compliance with reporting. Just because the gain ends up being zero doesn’t mean you do not have to report.

Genesis can help to file your U.S. tax return conveniently and confidently wherever you are in the world. I have in-depth knowledge and experience in expat tax preparation and filing. 

Send me your questions and tax documents and I will get to work for you. 

5 Tips for Choosing a Tax Return Preparer

Your annual physical. Spring cleaning. Flu shots. What do these activities have in common? Just like preparing and filing your taxes, you need to complete them every year. Yet filing your annual tax return can seem confusing or even scary. To make the process easier, many people prefer to work with an expert.

But even if someone else does the math, prepares, and files your tax return with the IRS, you are responsible for everything reported on your return. To avoid careless mistakes or even tax return preparer fraud or misconduct, it’s important to know what to look for – and avoid – when choosing a tax return preparer.

Here are five tips to help you find a qualified tax professional:

1. Do your research. Before the filing deadline, research potential tax return preparers to determine if they match your personal requirements (I myself am an expat living in Germany and a licensed Enrolled Agent-very rare in Deutschland), are responsive to your questions, and you’ll be able to contact them after your tax return is filed.

The IRS has a directory of preparers with certain kinds of credentials, such as enrolled agents. IRS.gov (search Hartney, Germany, Enrolled Agent, 65812 area code).

Check with the Better Business Bureau to see if the preparer has had complaints filed.

You can also check with associations to see if the preparer has received any disciplinary actions, and for the status of the preparer’s license:

• For Certified Public Accountants (CPAs) - State board of accountancy

• For attorneys - State bar association

• For Enrolled Agents - IRS Office of Enrollment

2. Get technical. Be sure the preparer’s qualifications meet your needs. Every professional tax return preparer must have a PTIN (Preparer Tax Identification Number). You can decide if you need an enrolled agent, a Certified Public Accountant, or an attorney who can represent taxpayers before the IRS in situations like audits, collection actions, and appeals.

3. Watch out for scams. Avoid any preparer who claims they can obtain a larger refund than other preparers, guarantees a refund, or bases their fees on a percentage of your refund. Also keep away from preparers who don’t offer follow-up support after tax season. Credible tax professionals are available year-round.

4. Stand your ground. If a preparer tries to persuade you to say something on your tax return that’s not true in order to secure a bigger refund, find another preparer. Also avoid any preparer who pressures you into buying additional services, asks you to sign a blank tax return, or requires that your tax refund be sent to a bank account under their control.  

5. Be diligent. Make sure your preparer gives you a copy of your completed tax return that was filed, and that it has the preparer’s signature and Preparer Tax Identification Number (PTIN). This will help protect your tax refund and guard against fraud or misconduct. Keep that signed copy in a safe place.

➤ locations served

Available for all taxpayers in every state and all Expatriates living abroad. 

☎ CONTACT NICHOLAS HARTNEY, EA

nick@genesistaxconsultants.com
and tell me about your situation.

Areas of Practice

https://www.expattaxhelpnearme.com/services-and-fees-overview