Koinly Review: Crypto Tax Software To Generate Tax Reports
Read the Koinly review to see if it is the best crypto tax software.
When you invest in crypto assets, you must report capital gains and other income when you file your taxes. It's more challenging to do this manually if you have an extensive portfolio with many holdings spread across several exchanges. It's good that software like Koinly makes it easy to generate tax reports and automatically calculate your crypto taxes.
If you're looking for complete cryptocurrency tax software that can save you time and fatigue, Koinly is undoubtedly one of the best options available. However, it's critical to understand what features Koinly provides and how it compares to other tax software. Our Koinly review will teach you everything you need to know about this popular tax software so you can decide if it's right for you.
Koinly Review Overview
Koinly Pros & Cons
PROS
CONS
What is Koinly?
Robin Singh established Koinly in 2018. The company is based in Palo Alto, California, and follows California law. The platform is available in over 20 countries, including the United States, the United Kingdom, Australia, Canada, and New Zealand.
Koinly allows you to import data via API, CSV files, or x/y/zpub keys and generate PDF reports. Form 8949, Schedule D reports, First In First Out (FIFO), Last In First Out (LIFO), and International tax reports are some of these. Koinly provides a complete online cryptocurrency tax auditing service that connects users with qualified tax accountants in their area.
Is Koinly legit and safe to use?
Koinly is legitimate, but even if it weren't, the possibility of losing funds to hacker attacks due to using Koinly is nil. Koinly uses your API keys to get information from your exchange accounts, but that's all it can do. It can't trade or take anything out of your account.
So, is Koinly Safe? In a word, Koinly is a perfectly safe service to use.
Is Koinly Safe To Use To Generate Tax Reports?
Koinly imports transactions using read-only API connections, just like other crypto tax software. It implies that Koinly is not able to change any of your cryptocurrency exchanges or wallets. Koinly doesn't even need any private keys to function.
Additionally, Koinly doesn't store your payment information and encrypts data in transit. Overall, these procedures make Koinly a secure and reliable crypto tax software. On its website, Koinly describes its dedication to security in more detail.
Koinly Features and Options
Next, we will discuss the software's features in this Koinly review. The platform has several valuable features, including:
Types of Transactions Supported on Koinly
As previously stated, Koinly is more than just a spot trading platform; it is an extensive tool that recognizes various types of cryptocurrency transactions:
Supported Wallets, Exchanges, & Services on Koinly
Because of its compatibility with practically every cryptocurrency platform, wallet, exchange, and service, Koinly easily wins on this metric.
It supports over 400 exchanges, 50 wallets, over 6000 unique coins, and over 30 cryptocurrency services (like lending platforms, cloud mining platforms, etc.).
Tax Reports You Can Make With Koinly
Koinly abides by all applicable tax laws in a number of countries. They employ the following procedures and tax forms:
Find a Cryptocurrency Tax Accountant via Koinly
Koinly connects users with IRS-approved tax experts who have experience with cryptocurrency taxes. Since new tax experts are constantly being added, this list will gradually expand over time.
Services for Accountants
Koinly's crypto tax software provides the tools you need to impress your crypto investor clients and skyrocket your business revenue.
In our Koinly review, we will now discuss what the app can do for you.
What is Koinly Crypto Tax App?
You can create a tax report using the Koinly cryptocurrency tax calculator and software based on your activities. It's useful for anyone interested in trading or investing in cryptocurrencies.
Using API keys, you link your exchanges, wallets, or other services to the Koinly app, and the app handles the rest.
Your transactions will be automatically imported, all market prices at the time of your trades will be calculated, transfers between wallets will be matched so you won't have to pay taxes on these transfers, and your crypto gains and losses will be calculated. Your crypto tax reports will be generated.
How Does the Koinly Crypto Tax App Work?
Koinly functions similarly to an advanced Excel spreadsheet. It is capable of performing numerous calculations quickly and accurately.
All of your transactions must be imported into the app as a first step. The API keys can be retrieved from your wallet, traded, and imported into Koinly. You can also import a CSV file exported from a wallet or exchange it into Koinly.
Koinly supports all types of cryptocurrency activities, not just spot trading. It recognizes and computes data from margin trading, lending, mining, staking, and borrowing activities. It is an actual Swiss knife for cryptocurrency taxes.
Next, all calculations must be double-checked to ensure that they were imported correctly. This summary is accessible without charge. It is a traditional portfolio tracking application that allows you to monitor your cryptocurrency holdings across multiple platforms and services.
The last step is to file your taxes, either manually or with the aid of tax preparation software like TurboTax, by exporting all of the Koinly-generated tax reports. Koinly can generate numerous tax forms, including Form 8949 and Form 1040.
Is Koinly Suitable for Beginners?
In this section of our Koinly review, we'll determine whether or not Koinly is suitable for new traders who need to calculate taxes. The platform mainly targets people already involved in crypto-related activities such as trading, staking, investing, mining, and lending. Koinly might not be for people just starting in the crypto world.
In this section of our Koinly review, we'll determine whether or not Koinly is suitable for new traders who need to calculate taxes. The platform mainly targets people already involved in crypto-related activities such as trading, staking, investing, mining, and lending. Koinly might not be for people just starting in the crypto world.
However, the platform is beneficial to crypto users of all levels of experience and allows newcomers to monitor their activities from day one. Koinly lets you track trades and transactions for five years, making it easy for experienced traders to report their activity.
The platform's scope is broad and connects to all major exchanges, wallet providers, and blockchains. It also allows you to quickly generate various reports, such as capital gains report, income/transaction report, complete tax reports, and end-of-year reports, which are popular among users.
The resource section educates users, and the crypto tax guides update you on your jurisdiction. Localized tax reports are also helpful, and error reconciliation features such as auto balance verification and negative balance warnings assist anyone unfamiliar with tax preparation.
The trader plan offers custom reports, live chat support, and high transaction tracking for active crypto enthusiasts. These features give high-frequency traders more personalized service, while the free plan helps less active enthusiasts manage their accounts. In the following section of our Koinly review, we'll discuss the tax setup for Koinly.
How To Set Up Koinly?
Step 1: Add your wallets
A wallet in the Koinly ecosystem is a container for all transactions from exchange accounts or cryptocurrency wallets. Although it has the same name as cryptocurrency wallets, it functions differently.
To start using Koinly, you create a wallet for one of the exchanges you trade on. Go to the Wallets page and select Add wallet to add a new wallet. You can choose your wallet (exchange, wallet, or service) by looking for it in the list or searching.
If the service you used doesn't already exist in Koinly, you'll have the option to create a custom wallet.
Step 2: Import transactions
You can choose the importing method for your transactions after clicking the wallet icon.
For most Koinly exchanges, you can set up auto-sync to download your transaction history and keep your data synchronized.
You can also use CSV files to import data if you can't find this option or would prefer to do so by choosing Upload CSV files.
Step 3: Let Koinly calculate your gains
After your import is finished, Koinly begins to analyze data. Market data is retrieved, wallet transactions are matched, and gains or losses are calculated.
Every country has a different system for calculating these taxes, and Koinly employs various cost-basis techniques like FIFO, LIFO, ACB, etc.
Step 4: Downloading your tax reports
A small notification will appear asking you to refresh your page once Koinly has calculated your gains.
Visit the Tax Reports page after refreshing the page to see a brief breakdown of your income and capital gains. The summary can be viewed without purchasing a Koinly paid plan, but if you want to download it, you'll have to fork over the cash.
Several tax reports are available for download from Koinly in CSV, excel, and pdf formats.
Koinly Pricing Plans
The platform offers a variety of plans designed to accommodate crypto traders of varying activity levels. Let's examine the pricing plans in detail in our Koinly review.
Koinly Free plan: It enables everyone to track their trades/transactions, exchange and wallet accounts, and get a capital gains tax preview, which can be used thoroughly. The Free account also gives you access to FIFO and LIFO tax reports and the ability to import data from various sources and contact the team via live chat and email.
Newbie Plan ($39): For $39 per tax year, you can generate FIFO and LIFO tax reports. Moreover, the international tax reports, detailed audit reports, Form 8949, and Schedule D reports. In addition, you can export to TurboTax and TaxACT; however, you are limited to 100 transactions.
Hodler Plan ($89): Per tax year, and gives you access to a similar set of features and an increase in your transaction limit to 1000. When you commit to this plan, you will also receive priority support.
Trader Plan ($169): Per tax year for 3000 transactions, $249 for 10,000 transactions. The Oracle plan gives you access to all of the features available on Koinly. It includes priority support and the ability to create customized reports. This plan also includes additional assistance from the support team, which will perform bulk actions and process custom files without additional fees.
The platform gives users access to a wide variety of features, and all plans at the moment include tax reports for the previous five years of your cryptocurrency activity.
You can view the team's full price list here to get a proper insight into all the options available.
Countries Supported by Koinly to Calculate Taxes
Koinly appears to support over 100 countries worldwide, with only the most popular options listed below. They can assist you with your crypto taxes if your country employs any of the supported cost-basis methods.
The Comprehensive Tax Report is appropriate for anyone looking to declare taxes in any country.
Here is a list of some of the countries that are supported:
Any country that utilizes one of the accounting methods listed below is also supported:
Average Cost Basis
First In First Out (FIFO)
Last In First Out (LIFO)
Shared Pool (UK only)
PFU (France only)
Here in this Koinly review, we will examine how Koinly holds up against the competition.
Koinly vs Competitors
Koinly's primary rivals include CoinTracker, ZenLedger, and Coinledger. Having researched and compared all of the available crypto tax tools, we can say with certainty that they are all very similar to one another in terms of both features and cost.
Koinly vs CoinTracker - oinTrackerKoinly has several advantages over CoinTracker, including lower transaction fees, a basic free plan that enables you to import 10,000 transactions, and support for 20+ countries with tax reports.
Koinly vs Zenledger - Both Koinly and Zenledger are major crypto tax calculators with comparable pricing and features. However, depending on your requirements, If you are a day trader, Koinly is better, Zenledger is better if you use DeFi frequently, and both are excellent for NFT minters and traders, etc.
Koinly vs CoinLedger - CoinLedger is a good option if you're looking for a portfolio tracker with good support for a number of countries. However, if you want a tracker that is available in more than 20 countries, Koinly is the better option.
FAQs
Is Koinly the best tax software?
Yes, Koinly is one of the best tax software options for cryptocurrency traders. Zenledger and Coinledger are two other useful tools.
Can you trust Koinly?
Yes, it is safe to put your faith in Koinly because the company is legitimate and has been around for a while, its founders are well-known, and they have a large team supporting them. In the crypto community, they have an excellent reputation.
Is Koinly worth paying for?
Yes, Koinly is worth the money you spend on it because it reliably automates the majority of the tax reporting tasks you need to complete for the local tax authorities.
Is it safe to connect Koinly to Coinbase?
Yes, connecting Koinly to Coinbase or any other exchange is safe because Koinly only requires read-only API rights to function.
Does Koinly share information with HMRC?
No, Koinly does not share any information. It is a tool that requires info from you to generate your tax reports automatically.
Koinly Review; Summary
Koinly is a good choice if you reside in a supported region and are looking for a way to keep track of your cryptocurrency transactions so that you can file tax returns. The web-based platform is simple to use and allows you to link your exchange accounts and wallet addresses quickly. It also allows you to monitor your activity.
The platform integrates with a diverse variety of cryptocurrency service providers and effectively covers its core activities. The service makes it easier to track all your transactions and removes the stress of ensuring you're on top of everything.
The service is reasonably priced, but you can't pay with cryptocurrency, and the company is still growing since it started in 2018.
However, with a free account, anyone can sign up to see how the platform works and if it accurately tracks all of their financial transactions.
Overall, our Koinly review finds that Koinly offers a service to an expanding crypto industry and the ability to monitor your entire crypto activities. Anyone concerned with maintaining financial compliance and ensuring a smooth transition between crypto and fiat currency will embrace these features.
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