TaxBit, which offers cryptocurrency tax automation software targeted for crypto users, exchanges, and merchants, announced on January 7, an investment from PayPal Ventures, Coinbase Ventures, and existing investor, Winkelvoss Capital. These new investments from major fintech companies reinforce the importance of tailored software solutions, like TaxBit, in driving widespread cryptocurrency adoption. TaxBit’s solutions automate all aspects of cryptocurrency tax compliance for consumers, businesses, and exchanges.
TaxBit Enterprise and TaxBit Consumer continue to transform the cumbersome experience of calculating and reporting taxes on cryptocurrency transactions. This investment will help TaxBit achieve its aim of being the most innovative and trustworthy provider of cryptocurrency tax technology.
This news comes only months after an announcement that TaxBit and prominent cryptocurrency exchange, Gemini, would be entering a partnership. Gemini’s CEO Tyler Winklevoss commented in October of 2020 “TaxBit’s software automates the calculations required for crypto tax reporting, helping reduce the pain point of crypto taxes for our users. Investors will also be able to see real-time tax implications of any trades they make on Gemini.”
The need for Crypto tax software has never been higher as the IRS has reiterated the importance of reporting taxable crypto transactions. In November of 2020 the IRS began sending the CP2000 notice to crypto traders based on 2018 taxes. “We’ve seen a flurry of customers coming to TaxBit for help with CP2000 letters based on Form 1099-K’s issued by exchanges during the 2018 tax year. The Form 1099-K reports a user’s total aggregate volume of payment transactions and does not take into account cost basis, as such does not accurately represent what you might owe in taxes.” said Justin Woodward, one of Taxbit’s tax accountants.
TaxBit, founded in 2017 by tax accountants and attorneys, aims to provide users with confidence and transaction level tax reporting to make completing their crypto taxes simple.
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