The new integration allows crypto users to automatically fill out the crypto portion of Form 8949, which is used to report capital gains and losses from investments for tax filings.
Crypto tax software provider CoinTracker is integrating its software with H&R Block, a company that helps millions of customers prepare their income taxes across Canada, the United States and Australia.
In an announcement seen by Cointelegraph, CoinTracker noted the partnership will allow American H&R Block customers to use CoinTracker and automatically fill in their Form 8949 regarding crypto trades. This form is submitted during tax season to report one’s capital gains and losses from investments.
Previously, users had to cut and paste crypto trade data into each form field on the H&R Block app, which could lead to mistakes. Under the new integration, H&R users can import their crypto transactions from “most” exchanges into their H&R Block tax returns.
Good news for Crypto holders. Filing cryptotaxes has never been easier. File with H&R Block Online, connect to Cointracker and just click import. More intuitive. More accurate. Learn more about how crypto can impact your taxes: https://t.co/XYjzra3z5B pic.twitter.com/6gGXlyNyr0
— H&R Block (@HRBlock) March 6, 2023
H&R Block is an American tax preparation company founded in 1955. In 2020, H&R Block had around 20 million tax customers.
The two companies also made some additional upgrades for the 2023 tax season as a result of the integration, including the offer of free CoinTracker accounts to all H&R users who have fewer than 25 crypto trades, as well as certain discounts for other H&R users.
In a statement, CoinTracker COO Vera Tzoneva said that the new integration should cut down on the hassle of paying crypto taxes, stating:
“The process of crypto tax filing is far too complex. We remain fixated on delivering peace of mind and the requisite tools for all crypto users. Partnering with H&R Block is a major step toward realizing this vision.”
Related: Bitcoin-friendly Cash App integrates TaxBit amid tax-filing season
Tax season is seen by some as a confusing and complex time for some crypto traders. While legally defined “crypto brokers” are required to issue a Form 1099-B to each customer, the Internal Revenue Service has yet to clearly explain what firms fall under the definition of “brokers.”
Most centralized exchanges produced the required forms for their users but not decentralized finance protocols. This has left some taxpayers relying on blockchain explorers to determine their gains and losses.
Even if a taxpayer only uses centralized exchanges, tracking gains and losses can still become complex if the user transfers crypto between exchanges, as this can cause transactions to show up on multiple forms.
CoinTracker’s crypto tax software is one of many.
Over the past few years, several crypto tax software solutions have been offered, including CoinTracker, Koinly, Taxbit, CoinLedger, TokenTax and others. These products allow the user to enter their exchange and wallet accounts into a single interface that tracks all of their transactions.
However, not all solutions are integrated with tax preparation platforms like H&R Block, TurboTax, FreeTaxUSA, etc.