CoinTracking - Profit/Loss Portfolio and Tax Reporting for Digital Currencies

[wizardofwhere]

Hey

I was reading a forbes article where it shows the cost of cointracking software at #325 but the website shows it at .4 BTC which is like $2600 or so.  Which is correct:  Here is the article
https://www.forbes.com/sites/greatspeculations/2017/10/31/smart-tax-accounting-moves-for-cryptocurrency-traders/2/#3a69a1b117c9

Thx

[Dario3000]

@Daled12:
I guess the ICO price is wrong or missing on that date.
Can you please go to the "Enter Coins" page, select your ICO sale transaction, click on "edit" and then on "edit Asset value".
This way you can update the value of your ICO token on that date.

@wizardofwhere:
The author is referring to the PRO lifetime package, which is at $325.

Best,
Dario

[happy9z]

Sell of    1.99995106 BTC    for    20.09090151 ETH    at Bittrex    31.05.2017 16:09:02
Sell of 1.99995106 BTC
There is no suitable purchase to this sale (all purchasing pools consumed). Assuming purchase on the same day for 0 USD.

Cost Basis: 0 USD
Proceeds: 4,611.43 USD (Price: 2305.77000000 USD / BTC)
Gain/Loss: 4,611.43 USD
Tax: 691.71 USD | Short-Term

Hi Cointracking,

This is from TAX REPORT tab from cointracking. On 05/31/17, I transferred 1.99995106 BTC to buy 20.09090151 ETH. This date is the first date I transferred BTC to bittrex.  I only bought and didn't sell. However, I see the Gain $4,611.43 USD, and Cost Basis is $0.

The cost basic should be $4,611.43, and the gain should be $0. Is there something wrong with the report? and How can I fix?

Thanks,

[SteelHead]

CT

You guys really need to set a firm price for your software. Bitcoin is going through the roof and your pricing goes right with it. 

[Dario3000]

@happy9z:
You need to enter your BTC purchase as well in order to calculate the gain.
Right now it looks like you sold 1.99995106 BTC without ever buying them, which leads to this red warning.

@SteelHead:
The upgrade price is based on USD.
If the BTC price changes, the price on CT will change automatically.
But I will add more decimal places to the price soon, in order to make changes easier to track.

Best,
Dario

[happy9z]

@happy9z:
You need to enter your BTC purchase as well in order to calculate the gain.
Right now it looks like you sold 1.99995106 BTC without ever buying them, which leads to this red warning.

@SteelHead:
The upgrade price is based on USD.
If the BTC price changes, the price on CT will change automatically.
But I will add more decimal places to the price soon, in order to make changes easier to track.

Best,
Dario

Got it, thanks ^_^

[SteelHead]

@happy9z:
You need to enter your BTC purchase as well in order to calculate the gain.
Right now it looks like you sold 1.99995106 BTC without ever buying them, which leads to this red warning.

@SteelHead:
The upgrade price is based on USD.
If the BTC price changes, the price on CT will change automatically.
But I will add more decimal places to the price soon, in order to make changes easier to track.

Best,
Dario

Thanks for the reply...still would prefer a set dollar based price but it's ur baby Dario.

I'am also finding some glitches with my Binance CVS import. BTC & ETH deposits seem to skew reports.
SALT token trades also not showing up?
Platform looks promising though, I'm working out the kinks

[Daled12]

@dario3000

Ok, when I go to edit asset values I see the purchase price is way off, so I made the purchase and sale price equal.

But I am noticing a bigger issue with your software.

On many trades, when I look at the purchase and sale price of my trades, there is a huge spread between purchase and sale price like between 10-20%.  This doesn't make sense to me.  If I am trading 1 BTC for 10 ETH, you shouldn't be using 2 prices for this transaction, shouldn't they be occuring at the same price minus a small trading fee like .25%?  I think this is causing all my numbers to be off in your software.

[Daled12]

One more thing...

I am guessing when I trade BTC for XRP, you are using 2 seperate pricing databases to get the purchase and sale price, correct?

You are grabbing the BTC price and the XRP price seperately, right?

This is causing big errors when recording trades because your databases aren't that accurate.  

I have a suggestion, lets say I am trading BTC for XRP.  Why not just use the BTC price(I assume this database is your most accurate), and then subtract the trading fee to come up with the Altcoin price?  This would be much more accurate.  Currently when I am switching from best, transaction, and counterparty pricing, I am seeing huge(2x) differences in my realized gains numbers which is not giving me much confidence in the software.

[hgmichna]

@Dario3000,

you mentioned that you might add more input formats. I could arrange to get some sample files. Where should I send them, if at all?

Do you already have input formats for local wallets? If yes, how does CoinTracking match a record from an exchange to a record from a local wallet? Or does the user have to do this by hand?

Local wallets are not very important for tax calculations, but sending from a local wallet to an exchange incurs the miner fee and proves a longer holding time.

[happy9z]

Sell of    0.00001763 BCH    for    0.00000141 BTC    at Bittrex    10.08.2017 16:58:41

Sell of the remaining 0.00001763 BCH
There is no suitable purchase to this sale (all purchasing pools consumed). Assuming purchase on the same day for 0 USD.

Cost Basis: 0 USD
Proceeds: 0.00 USD (Price: 274.09045939 USD / BCH)
Gain/Loss: 0.00 USD
Tax: 0.00 USD | Short-Term

Hi cointracking,

Do you know how to fix this one? Would you please help?

Thanks,

[HelloCrypto]

Hey there. The UK tax year isn't based on calendar year, which makes it difficult when producing tax reports. The UK tax year is from 1 April to 31 March the following year i.e. 01/04/2016 to 31/03/2017 (dd/mm/yyyy). Please could you add that feature to the tax year options (dropdown) when generating a new tax report? That would be great.

In addition, on the Tax Data side, it would be beneficial to have a new input for Capital Gains Tax Allowance (in the UK the first £11,500 (changes every year) of capital gains are not taxable), where the user could input a value which is then subtracted from the total gain, where a new value (Total Gain - Allowance) is used to calculate the total tax amount.


Thank you very much - I hope you get a chance to consider these improvements.

[Reynaldo]

On the new Trade Analysis can we add % profit when we choose a specific coin? On the square that says Break Even price, total cost, current value profit/loss

[Dario3000]

@HelloCrypto:
Next to the "Tax year" label, you will find a link called "custom date range".
Use it if you want to create a tax report from 1 April to 31 March.

At the end you will see the total calculated gain for the tax period.
You can just subtract £11,500 from it and multiply it with your tax rate.
But I will put a Capital Gains Tax Allowance on the to do list to make it easier


@Reynaldo:
You mean a %-value for the PnL?
Sure, I will add it.


@happy9z:
Looks like your BCH transactions are missing.
You should add an "Income" of the amount of BCH you received on the day of the fork.


@hgmichna:
Which local wallet are you using?
If it supports CSV exports, it should be very easy to import all transactions using the Excel oder Custom Exchange import.
Or just send us a CSV file and we will create an import for it.


@Daled12:
You are right. Each coin has it's own price.
Usually the spread should be <1%, but for some exotic coins with a low trade volume (or older transactions < 2015), it can be higher.
Using the "Best Price" setting, this spread will be ignored and the price of the higher volume coin will be used.
That's why I recommend to use this setting for all gains and tax reports.

Best
Dario

[HelloCrypto]

@HelloCrypto:
1. Next to the "Tax year" label, you will find a link called "custom date range".
Use it if you want to create a tax report from 1 April to 31 March.

2. At the end you will see the total calculated gain for the tax period.
You can just subtract £11,500 from it and multiply it with your tax rate.
But I will put a Capital Gains Tax Allowance on the to do list to make it easier

Best
Dario

Hey Dario. Sure, the custom date range is a great feature - without that I would be having major issues! Just saying it would be nice to have a radio button at the top to switch between 'standard calendar years' and 'UK financial years', then if the latter is selected, the drop downs become 01.04.yy - 31.03.yy

Also, when I do input a custom date range and run the report, the value of 'Tax Year' in the table becomes 'Custom' for each report - when you have a few reports there it's hard to follow which one is which, so it would be great if rather than displaying 'Custom', it actually displayed the date range that the user has picked.

Cheers

[Reynaldo]

Is it possible to buy a lifetime and monitor a massive amount of accounts from there? if its possible, let me know via pm or here.

[Dario3000]

@HelloCrypto:
Ahh... I see.
I will try to update that


@Reynaldo:
You can use a lifetime subscription for up to 10 accounts, as long they are linked.
We also provide corporate accounts if you need more than 10 portfolios. Just let us know via a support ticket please.

Best,
Dario

[1MExpodingSuns]

Is there any chance of supporting the Canadian accounting system for capital gains?

It uses an adjusted coat base ("ACB") that is basically the average cost to date of all transactions for that commodity at the time of the transaction, with the ACB being exhausted and resetting to 0 each time the individual reduces the commodity to 0.

The taxation system doesn't permit LIFO, FIFO, HIFO, or LOFO, but basically just averages the cost of all prior transactions for each transaction until the commodity is exhausted to 0.

There is a simplistic explanation with examples here:

https://www.adjustedcostbase.ca/blog/how-to-calculate-adjusted-cost-base-acb-and-capital-gains/

[Daled12]

@dario

Thanks, that is good news, sounds like you are on top of it.

I do think you need to do a bit better job of explaining that though on the site(maybe I am not seeing where it is fully explained), its not really clear how it works, especially if you don't have an accounting background.

For example I am still a little confused on this explanation on the site:

Best Prices: (recommended)
The currency with the lowest conversion difference (spread) is used in this order:
1. Fiat currencies (USD, EUR, GBP...)
2. Bitcoins (BTC)
3. Altcoins and commodities (ETH, LTC, XAG...)


So when I trade BTC for XRP, you just said in your response you are using the US dollar value of the BTC to determine the transaction price, correct?  So when would case 2. (BTC) ever be used?  Or in my example are you using case 2?

[hgmichna]

A typical trade scenario is that somebody sends bitcoins to an exchange, trades them back and forth for a while, then withdraws the bitcoins (hopefully more of them) back into her local wallet.

Local wallets are typically of the HD type, so there can be many addresses from which bitcoins are sent, even in one transaction. But it is important to track the bitcoins on the local wallet, because any gains can be tax-free (Germany) or incur a reduced tax (US) when they are held for a certain time, like one year.

How easy or difficult is it to let CoinTracking know which bitcoins have been withdrawn from an exchange into a local wallet and later sent to an exchange, so it can determine the holding time?

I have seen a function in CoinTracking that allows me to enter a single address to be monitored, which could be a local wallet address. But with an HD wallet I would have to enter many addresses, one by one, to use that function. Is there a better way?

There is also the question of fees when sending from a local wallet. I have looked at Mycelium export files, and unfortunately they don't include a separate fee entry, so the sent bitcoins will be a tad more than the ones received by the exchange. Does CoinTracking actually look into the blockchain to match these outgoing and incoming coins?

Before I study and analyze CoinTracking functionality, I'm sure the answer is already known very well, so I'm asking here first.