Crypto tax has become a hot topic, as governments are beginning to take extra measures to set up tax rules for cryptocurrencies. This is where tax filing platforms like Koinly.io comes in. In this article, we will explore the features of Koinly as well as its pros and cons.
What is Koinly?
Koinly is a web-based platform that allows users to track their crypto activities and file crypto tax reports. You will agree that the simple tasks that Koinly tackle has become mandatory for crypto practitioners, particularly those based in locations with clearly-stated crypto tax rules. In light of this, Koinly puts several features in place to help users do the needful.
What Are the Major Features of Koinly?
Koinly claims that it supports crypto taxation rules in 100 countries and offers simple to understand procedures for getting crypto taxes calculated. To do this, Koinly needs to access all your crypto transaction records as well as the transaction fees charged for each. While this might seem cumbersome, Koinly, however, offers an API where you can input your public address or other details. With this, you can sync data from your crypto exchange accounts or wallets where you facilitate crypto transactions.
According to Koinly’s website, it can import data from 300 exchanges, 6000 cryptocurrency, and 68 wallets. And even when you can’t seem to sync an app or platform with Koinly, you can download the data in a CSV or Excel format before importing it on the tax calculator. We also discovered that registering on the platform is straightforward, as there is an option to log in with your Google or Coinbase details. Besides, signing in with your Coinbase details will automatically trigger the download of the data from your Coinbase account. Also, once you have an account synced with the Koinly platform, it updates the data as soon as you execute new transactions.
Tax Reporting Feature
After importing your data, you can utilize the tax reporting features of the platform to carry out some interesting tasks. Needless to say, this is the core functionality of Koinly, and it packs a bit of punch. This section of the app analyzes the downloaded data and generates a tax report based on the tax class that crypto falls under in your country. That said, users can create capital gain reports from market data from as far back as five years ago.
Also, Koinly’s tax calculator comes with audit logs. Likewise, you can chat with the platform’s tax experts on matters relating to crypto tax issues. Apart from calculating taxes resulting from your crypto exchange transactions, you can input income from crypto loan platforms, mining activities, and crypto staking to create a comprehensive report.
Portfolio Tracking Features
Koinly enables portfolio-tracking features, which you can use to monitor your holdings on crypto exchanges and other crypto service platforms. As such, Koinly can help you assess trades – as regards their implications on your tax – and improve your decision-making process. Also, you can visualize your holdings, its return on investment (ROI), its valuation, and check whether its value has increased or decreased over time. Similarly, you can ascertain the total amount spent on transaction charges and the effects of these payments on your long-term earnings.
Having explored the features accessible on Koinly, the next section discusses the pros and cons of the platform.
What Are the Pros of Koinly?
Simple User Interface and Easy-To-Use Tools
From our research, we discovered that the simplicity of Koinly’s website design enables a seamless environment for users. It is easy to navigate the platform, and the procedures for using the tools are straightforward. Take for instance the stress-free process of importing exchange and services data into the application. Then, there is Koinly’s almost-instant tax calculation service, which does not require any formal knowledge of tax reporting.
Premium Customer Service
Knowing fully well that reporting tax might not be everyone’s bread and butter, Koinly has, therefore, incorporated a chat tool for its users to communicate with tax experts. As such, users can narrate their plights to crypto tax professionals while utilizing the platform’s tax calculator.
The Platform Supports A Wide Range of Exchanges and Cryptocurrencies
Koinly has proven that it can become the one-stop website for crypto practitioners, especially on matters relating to crypto taxes. This notion holds, considering the platform’s capacity to support a reasonable number of crypto exchanges and cryptocurrencies. As stated earlier, Koinly supports over 300 exchanges and 6000 cryptocurrencies. Hence, crypto holders who have their holdings distributed across several exchanges, or own a diversified portfolio, can get all their tax reporting on just one app.
Crypto Portfolio Tracking Opens A Window of Opportunities for Users
We mentioned Koinly’s crypto portfolio tracking features earlier in this review. And from what we learned about its functionalities, it is safe to say that Koinly does much more than calculating taxes for users. With this tool, it is possible to access vital information regarding all of your crypto investments at the touch of a button. You can check for profits, losses, and promising investments. Also, you can assess the strengths and weaknesses of your investment decisions and factor in a lot of details before making future calls.
More importantly, tracking your portfolio via Koinly comes with no charges. The platform only demands a fee when users want to generate tax reports. For its tax reporting services, there are three subscription packages – ranging from $79 to $399 – available to their users. The pricing depends on the number of transactions they need to file in their tax reports.
You Can Export Your Report or Data to Other Popular Tax Filing Systems
Apart from coming with an easy-to-use data-downloading feature, Koinly also avails a file-exporting tool, which you can use to send data from the platform to other tax filing apps. By so doing, you can incorporate data generated or downloaded on Koinly into other tax processes enabled on platforms like TurboTax, Xero, and TaxAct
What Are the Cons of Koinly?
After researching the operations of Koinly, we could not find any aspect of the platform that could stand as a drawback.
Koinly establishes a well thought out design, and it does more than is expected of a crypto tax calculator. The website is beginner-friendly, efficient, and offers impressive crypto portfolio tracking features. Although we couldn’t find any limitation, we, however, advise that you take the time to check out the website and do extensive research before going ahead to adopt the platform.