The Crypto Tax Blueprint™ by Crypto Blocko™

Benefit 1

Audit-proof your crypto taxes. Create the best backup support for your tax calculations and keep the tax man away. 

Benefit 2

Learn how to AVOID 37 different Crypto Tax Mistakes and pitfalls that can cost you $1,000s in taxes. 

Benefit 3

Use our 64 Key Takeaways to calculate the lowest tax and complete crypto taxes with the least amount of headaches. 

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Crypto assets can produce extraordinary returns...

The gotcha is having to manage and calculate crypto taxes. It doesn't matter where you are in the world everyone has to deal with crypto taxes. 

Roses and thorns are a package deal and the same is true with crypto returns and crypto taxes. You can't have one without the other. 

Do you know ALL the tax steps crypto users are responsible for?

Let's take a closer look...

  • Gathering and sorting through the transactions
  • Compiling the data
  • Analyzing the data
  • Choosing specialized tax software
  • Importing the data
  • Troubleshooting errors
  • Overcoming missing transactions and lost data 
  • Choosing an acceptable cost basis method
  • Calculating and formatting the attachment
  • Reporting the correct numbers and presentation in tax return software

Guess what? Unlike ALL other tax reporting YOU are responsible for producing the tax form to include in your taxes. 

That's right, think how crazy it would be if you had to prepare your own:

  • W-2 from your employer
  • 1099s for interest or subcontractor work
  • 1098 mortgage interest
  • 1099-B brokerage statements for all your securities transactions

Well that's what you have to do when it comes to crypto taxes. 

You are your own third party responsible for producing your own tax form to include with your taxes.

NOBODY wants to do this, but YOU have to. Even though crypto taxes are a pain it's an inconvenience worth the upside in crypto. 

The best approach is having:

  • A Formula
  • A Plan 
  • A Roadmap
  • A Guide
  • A Process

To make crypto taxes as EASY and PAIN FREE as possible so you can spend more time focusing on crypto.

That's why YOU need The Crypto Tax Blueprint™: From Exchanges and Wallets to Completed Tax Return.

 

Get the Blueprint NOW

"I always want to do things the right way including taxes. I just wanted some kind of guide to show me the best way to do my crypto taxes and this course was exactly what I was looking for"

Megan M. 

You're in one of 3 places when it comes to crypto taxes:

  1. Some of you may be saying to yourself "I just don't want to deal with it" 
  2. Meanwhile others are the die hard do-it-yourselfers who conquer everything on their own
  3. Some folks are in between

Even if you don't want to deal with it and are willing to pay an unlimited amount for professional services, you simply can't do it. 

You are probably thinking, "What the heck is he talking about?...,There are lot's of professionals offering crypto tax services." 

I know because we are one of the leading service providers. 

Getting Crypto Tax RELEGATED

  • Like it or NOT and as we stated above you are your own Third Party. 
  • You are responsible for completing your own tax form. 
  • You CAN'T use a "blank check" to take YOURSELF out of the equation. 

Why can't I take myself out of the equation?

  • You control your own assets whether on an exchange or a wallet
  • Because you control your assets you also CONTROL all the transaction DATA
  • Exchanges and wallets are NOT designed for third party access. 
  • There essentially are NO read only users in crypto. 
  • You are the ONLY user.
  • If you give access to your crypto data you are giving access to your crypto assets. That is a NO NO. 
  • It's a risk you can't take and a risk professionals should not take. 

Since you are the ONLY user YOU are RELEGATED to being your own Third Party and producing your OWN tax form.

Sure you can still hire a professional and that makes sense in a lot of cases. But you still have to do at least 50% of the heavy lifting and maybe more. 

The Possible Scenarios

  • YOU do 50% of the work and a professional does the other 50% of the work. 
  • YOU do 75% of the work and a professional does the other 25% of the work. 
  • YOU do 100% of the work
  • There is always somewhere in between

Do Your Part With EASE

Since you get crypto RELEGATED you should eliminate headaches and do your part with EASE. 

It doesn't make sense to tackle a huge undertaking without: 

  • A Formula
  • A Plan 
  • A Roadmap
  • A Guide
  • A Process

That's why YOU need The Crypto Tax Blueprint™: From Exchanges and Wallets to Completed Tax Return. 

 

Get the Blueprint NOW

Remember your goal is ALWAYS a Crypto Bullseye™

MISTAKES and PITFALLS

Now we're finally getting to the good part. We probably made it sound like the ONLY reason you need a blueprint is because you are FORCED to do a big chunk of the work yourself. 

That is totally true.

You also have to run across a minefield full of crypto tax pitfalls. Step in the wrong place and you blow yourself up. 

In "Tax Talk" that means:

  • Getting audited
  • Paying more taxes than necessary
  • Pulling your hair out
  • Spinning wheels
  • Incurring penalties
  • Not setting yourself up for future years
  • And so on 

AVOID 7 Crypto Tax Mistakes and Pitfalls 

Let's take a look a select few crypto tax mistakes and how to avoid them. There's a heck of a lot more to crypto taxes then people realize which is why we created The Crypto Tax Blueprint™

PITFALL #1: Paying Higher Tax from Poor Organization

Poor organization results in wheel spinning and wasted time and energy. When it comes to crypto files, organization is CRITICAL. You can end up paying more tax when you don't have up to date information to make informed investment decisions. 

How is this possible? You have a coin with 5X appreciation and decide to cash in and take some profits which creates a large capital gain. Meanwhile, your crypto records and software is not up to date and you could have sold some altcoins for a loss and therefore offset the gains if only you had that information at your fingertips.

Most people are terrible when it comes to naming, saving and organizing files. This means most people waste countless hours searching for poorly named files over the course of a year. If that sounds like you don't do that same bad habit. You'll create a crypto file nightmare. 

PITFALL #2: The Fictitious Gains Dilemma™

Failing to select the right cost basis method for your unique situation, may result in unnecessary higher capital gains. Cost basis is simply an inventory method determining in which order your crypto holdings are sold for tax purpose. For example, FIFO (first in first out) “sells” your oldest coins first.

You could get burned by The Fictitious Gains Dilemma™ if the wrong method is applied to your investing style. In many cases BTC and ETH have to be used to buy another coin like Zen rather than just using USD from the beginning. For example, you buy BTC with USD and then use the BTC to buy Zen. The hop transaction in the middle creates a large capital gain using FIFO. It’s IMPOSSIBLE to trigger a gain on a purchase, but this crazy phenomenon can happen, but don’t let it happen to you.

PITFALL #3: Cost Basis Double Dipping

Choosing a different cost basis method every year that produces the lowest gains (or highest losses) is a major violation. Using different cost basis methods from year to year to get the best results would effectively be double counting or double dipping and would NOT be a reasonable and consistent approach. If you did this in previous years you should consider amending your tax returns.

For example, you choose FIFO in 2017, LIFO in 2018 and average cost in 2019 because ALL three produced the lowest capital gains for a given year. You have to stick with the cost basis methods you selected in Year 1, the first year of your crypto taxes. 

NO BBD Allowed Every heard of the "bigger better deal"? Some folks will bounce from one deal to another or one job to another to get the better deal as fast as possible with no loyalty or consideration for the carnage. 

Guess what? Using the BBD method for selecting cost basis doesn't work. In all things tax you have to be reasonable and consistent in your approach, therefore you have to select a cost basis method and stick with it. It doesn't work to pick whichever cost basis provides the lowest tax in a given year. Otherwise picking FIFO, then LIFO, CCFO and back to FIFO would be double dipping or double counting. 

PITFALL #4: The Missing Transactions Dilemma™

Missing crypto data is a huge problem creating risks on a number of fronts and may result in paying higher taxes. If you lose all transactions for an exchange or wallet how are you going to calculate taxes? There could be gaping holes in your transactional landscape making it nearly impossible to complete accurately. A forensic reconstruction may result in taxable gains much higher than actual.

The Missing Transactions Dilemma™ can happen to anyone from sloppy organization and record keeping to defunct exchanges and lost private keys. This leads to loss of assets, missed opportunities, mistakes and anxiety. Don't do that to yourself. In some cases, it’s possible to accurately solve and plugs the holes from missing transactions. If you have this issue, hopefully it will be a motivator so you don’t end up with missing transactions a second time around.

PITFALL #5: Software is NOT a Magic Wand

Crypto tax and accounting software is NOT a magic wand. The typical marketing message is something like "complete your crypto taxes in minutes." Overall, crypto software is amazing but the magic happens when you follow a process which requires a major time commitment in crypto. The software is only as good as what you put it and your tax return is only as good as how good you covered your ass (CYA).

Software can always glitch out and create problems that have nothing to do with your efforts. Occasionally, crypto tax software may import the data incorrectly or apply an incorrect price feed. A LOW price for cost basis may produce a HIGH incorrect gain. Crypto software warnings do NOT magically identify ALL issues. Some issues we may be BURIED somewhere in the transactions. Additional checks are necessary to self-proclaim an accurate calculation. If you don’t know where and what to look for you could be OVER relying on the software to calculate correct gains.

PITFALL #6: Failure to Document

Crypto tax software reports are only one part of the total lifecycle of crypto tax transactions management. Remember The Missing Transactions Dilemma? You need to make reasonable estimates when reconstructing data which includes a narrative or memo to describe when, where and what happened to your crypto or the data about your crypto. Failure to document your crypto for back up support leads to headaches, higher taxes and potential audit risk.

Taxpayers are ultimately responsible for their tax returns and the basis for EVERY item reported on a tax return. This could be a simple as a W-2 or 1098 mortgage interest statement or super complex like back up support for crypto taxes. Backup includes archiving raw transaction reports for exchanges and wallets, receipts, USD used to acquire crypto, crypto received as compensation, airdrops, hardforks and much, much more.

PITFALL #7: IRS Audits and Crypto Scrutiny

The IRS is hot to trot on taxpayers using crypto or “virtual currency” as they call it. They’ve sent virtual currency “warning letters” from a Coinbase customer list summons and use other investigative techniques to identity non-compliance. Don’t think about reporting some of your transactions, but NOT all of them. Your tax calculations may produce higher gains by leaving certain transactions out of the software.

The IRS is also using platforms like Chainalysis and CypherTrace to perform transaction analysis on multiple blockchains which is capable of tying identity to addresses that don’t otherwise have identify tied to them. Don’t get audited because it will not be fun and even worse if you get caught underreporting your taxes.

Check This Out....

We’ve identified at least 37 crypto tax pitfalls.

These are the quicksand pitfalls taxpayers step into resulting in additional time, money and energy to solve. The opportunity in crypto is huge and dealing with crypto tax headaches turns into missed opportunities.

We also created at least 64 Key Takeaways

These help you AVOID mistakes, get an audit-proof crypto tax calculation, pay the least tax possible and keep you from pulling your hair out in the process. 

Are you still wondering where you can get all those golden nuggets?

It's all included in 9 power packed modules plus a bonus module in The Crypto Tax Blueprint™: From Exchanges and Wallets to Completed Tax Return. 

You crypto tax management needs to be a well-oiled machine and The Crypto Tax Blueprint™ gets you there.

 

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Yours in Crypto, 

Kirk Phillips, CPA, CMA, CFE, CBP

The Crypto Tax Blueprint™: From Exchanges and Wallets to Completed Tax Return

It's like hiring a white-glove crypto advisor without the cost. 

Get the Blueprint Now