The The IRS treats cryptocurrency as property, meaning that all crypto transactions—including those on decentralized exchanges (DeFi) and self-custody wallets—are taxable. Taxable events include sales, swaps, staking rewards, transactions using stablecoins, and NFT transactions, all of which must be reported.
This leaves a significant portion of onchain and DeFi activity at risk of being unreported.
With the rise of decentralized finance, this misconception can lead to substantial tax liabilities without traders realizing it.
The Reality
Cryptocurrency is subject to capital gains and income tax. Most crypto transactions—whether a trade, swap, staking reward, or NFT sale— trigger a taxable event and must be reported to the IRS accordingly.
However, one common misconception is that transferring assets from one of your wallets to another one of your own wallets is taxable. This is false, self-transfers are not taxable.
This misconception leads to non-compliance risks, as IRS enforcement continues to grow.
The implementation of the 1099-DA, and the United States’ commitment to regulating the crypto industry highlights the importance for taxpayers to file accurate tax returns, including crypto activity.
The Reality
Blockchain records are fully transparent. Tax authorities can monitor transactions and trace information across multiple wallets. The IRS requires taxpayers to report all crypto-related income and capital gains, emphasizing the necessity of accurate tax reports.
Blockchain technology ensures that all transactions are publicly recorded, meaning that regulators can trace activity.
Compliance efforts by governments and blockchain analytics firms are closing tax loopholes.
1099DA Form
Requires centralized exchanges to report user transactions to the IRS.
Crypto Asset Reporting Framework (CARF)
A standardized global initiative signed by 50+ countries to track and tax crypto activity.
Increased IRS Focus on DeFi & Self-Custody
New technologies enable authorities to trace transactions across multiple blockchains.
How Summ helps you stay ahead of the IRS
Precision calculations
Our software is specially designed for cryptocurrency and integrates with more than 3500 exchanges, wallets, blockchains and DeFi protocols to give you unparalleled accuracy.
IRS forms
Download specific IRS forms like Form 8949, pre-filled with your transaction data, saving you time and making sure you meet reporting standards.
Cost-basis tracking
Summ (formerly Crypto Tax Calculator) supports the latest IRS rules for cost-basis accounting and let’s you automatically switch to the new system without having to calculate anything yourself.
Full transaction history
Get reports for all tax years with a single subscription, allowing you to catch-up on any previous years.
2025-04-08
Pricing
Hobbyist: $49 (100 transactions)
Investor: $99 (1,000 transactions)
Pro: $199+ (3,000+ transactions)
Is there a free version?
Yes, CoinLedger offers a free version with portfolio tracking and unlimited transactions. To gain access to any reports, you’ll need to upgrade to a paid plan.
Pros and cons
Pros
Unlimited transaction plan available for high-volume investors.
Known for its NFT support, including an integration for OpenSea.
International tax reporting, with over 40 countries supported.
Cons
Doesn’t accept crypto as payment.
Doesn’t offer specialized tax forms such as Schedule D.
Pricing
DIY Plans
Silver: $49 (100 transactions)
Gold: $199 (5,000 transactions)
Platinum: $399 (15,000 transactions)
Professional Consultation Plans
Premium Support Consultation: $275 (60 mins)
Tax Pro Prepared (single year): $2800
Tax Pro Prepared (multi-year): $5200
Is there a free version?
Yes, you can import your crypto transactions for free. However, to view, download, or access reports, you need to upgrade to a paid plan.
Pros and Cons
Pros
Integrates with tax platform TurboTax.
Offers professional tax consultations and services.
Offers a 14-day money-back guarantee/refund for all plans.
Cons
Doesn’t accept crypto as payment.
High cost. If you have more than 100 transactions, you’ll need to pay $199.
Limited customer support. Some customers have reported issues with long wait times and a lack of helpful responses.
Pricing
Newbie: $49 (100 transactions)
Hodler: $99 (1,000 transactions)
Trader: $199 (3,000 transactions)
Pro: From $299 (10,000+ transactions)
Is there a free version?
Yes. Koinly provides a limited free version that allows you to track your portfolios. For access to any reports, you’ll need to upgrade to a paid plan.
Pros and Cons
Pros
Accepts crypto as payment, in addition to credit/debit card payments.
Provides an income overview, so you can see how much crypto you’ve earned from all your activities.
Supports more complex crypto transactions like DeFi, NFT, and margin trading.
Cons
Limited security features. Compared to other crypto tax software, Koinly only mentions one layer of security – SSL.
Higher cost. Compared to other platforms, especially if you’re a high-volume trader.
Usability. Some customers have reported potential syncing and labelling issues within the platform, while others said it wasn’t easy to navigate.
Pricing
Basic: $65 (100 transactions)
Premium: $199 (5,000 transactions)
Pro: $1,999 (20,000 transactions)
VIP: $3,499 (up to 30,000 CEX transactions)
Is there a free version?
No free version available.
Pros and cons
Pros
Customer service. Live chat support is offered for every pricing tier.
Tax-loss harvesting. Offered for premium customers paying $199.
Multiple payment options. Accepts card or crypto payments.
Cons
TokenTax costs a lot more than other crypto tax platforms. If you have over 100 transactions, you’ll have to pay at least $199.
No refunds or money-back guarantee.
No free version available.
Pricing
Rookie: $49 (up to 100 transactions)
Hobbyist: $99 (up to 1,000 transactions)
Investor: $249 (up to 10,000 transactions)
Trader: $499 (up to 100,000 transactions)
Advanced Trader: $999 (up to 200,000 transactions)
Summ also offers a 30-day, 100% money-back guarantee. If you’re not satisfied, you can receive a full refund by contacting the support team.
Is there a free version?
Yes, Summ is free to use instantly when you sign up, allowing you to gain a full picture of your crypto portfolio, with support for up to 100,000 transactions. Take advantage of the smart suggestion and auto-categorization engine, portfolio tracking, unlimited integrations, DeFi and NFT support.
To access the reports, the tax loss harvesting tool and priority support, you will need to upgrade to the appropriate paid plan.
Pros and Cons
Pros
Tax platform partnerships. Users can file reports directly with TurboTax and TaxAct.
Low price. Its starter ‘Rookie’ plan is one of the cheapest ones out there.
Tax loss harvesting tool. By identifying assets to sell at a loss, you can reduce your overall tax bill available on the or Investor and Trader plans.
Dedicated customer support. 24/7 support, including email and live chat support with a real person available for all customers.
Portfolio tracking mobile app. Connect your Summ account with the iOS mobile app and get a detailed view of your portfolio with accurate PnL & tax calculations.
Support for 200,000+ transactions. Perfect for high-volume traders.
Unlimited report downloads each year. Under the one plan subscription price you can download unlimited reports each year, perfect for users who make adjustments or are filing for multiple years at once.
Cons
Doesn’t currently accept crypto as a form of payment.
Mobile app not available on iOS
The tax optimization algorithm is only available on Investor and Trader plans
How Investing vs Trading impacts tax
In most cases of buying and selling cryptocurrency as a retail investor, you are participating in investing rather than trading. The two are treated differently for tax purposes.
Investing is subject to capital gains tax or income tax, depending on the nature of the transaction.
Trading in this case refers to self-employment which is subject to income tax and National Insurance Contributions.
The key difference between investing and trading – along with the different tax treatments, is how losses generated in the crypto-activity can be used.
In their guidance, HMRC have explicitly stated that they would expect it to be exceedingly rare that any crypto-activity constituting buying & selling crypto would be classified as “trading”.
If you are uncertain, speak to a tax advisor as there are always exceptions, including but not limited to, developing tokens and large scale mining.
How is crypto tax calculated in the United States?
You can be liable for both capital gains and income tax depending on the type of cryptocurrency transaction, and your individual circumstances. For example, you might need to pay capital gains on profits from buying and selling cryptocurrency, or pay income tax on interest earned when holding crypto.
CoinLedger
CoinLedger is an accessible crypto tax platform with over 1,000 exchange and wallet integrations.
Best for: Users who want a simple, straightforward experience without complex DeFi needs.
Key differentiator: Offers an unlimited transaction plan for high-volume traders at a fixed price.
Pricing: $49 (100 transactions) to $499+ (10,000+ transactions).
Limitation: Does not generate Schedule D forms - you will need to complete this manually or with other software.
Notable: Strong NFT support with OpenSea integration.
CoinTracker
CoinTracker is a portfolio tracker and tax calculator supporting over 30,000 cryptocurrencies.
Best for: Users who prioritize portfolio tracking alongside tax reporting.
Key differentiator: Direct integrations with TurboTax and H&R Block Desktop.
Pricing: $59 (100 transactions) to $599 (10,000 transactions), with full-service options up to $3,499.
Limitation: Customer support is limited on lower-tier plans - priority support requires the $599 Ultra plan.
Notable: Good security with end-to-end encryption and SOC 2 compliance.
ZenLedger
ZenLedger offers both DIY crypto tax reports and professional full-service accounting.
Best for: Users who want tax loss harvesting included at every pricing tier.
Key differentiator: Tax loss harvesting is available on all plans, not just premium tiers.
Pricing: $49 (100 transactions) to $399 (15,000 transactions).
Limitation: Only offers 400+ exchange integrations - significantly fewer than competitors. Some users report customer support issues with long wait times.
Notable: TurboTax integration and 14-day refund policy.
New research by Summ (formerly Crypto Tax Calculator) shows that 70% of Americans don't understand their crypto tax obligations. Here's what needs to change.
Starting this year, crypto exchanges start collecting your detailed transaction data to share with the IRS. If you’ve been unsure about how to report your crypto on your taxes, you could already be at risk of an audit.
To help clear things up, we surveyed 1,516 American Crypto Traders and discovered the biggest misconceptions about crypto tax.
We found that an overwhelming majority of Americans are making mistakes that put them at a heightened risk of an audit by the IRS.
Here's what you need to know if you want to stay on the IRS' good side this year.
Misconception #1
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Misconception #2
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Misconception #3
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The Rising Pressure from Regulators: Global and U.S. Compliance Crackdowns
While United States crypto investors remain unclear on their obligations, regulators are tightening oversight, requiring greater transparency in crypto taxation.
In the U.S., 1099-DA reporting now mandates centralized exchanges to report transactions to the IRS, while CARF, adopted by over 50 OECD countries, sets a global crypto tax standard. These efforts aim to close tax gaps and enforce compliance.
Crypto traders must evolve past outdated assumptions about anonymity and taxation. New regulations mean the IRS has more tools than ever to enforce compliance.
With the new data-sharing arrangements starting this year, the age of excuses is over – taxpayers need to get their reporting in order to avoid stiff penalties and fines.
But you still have time to act before the April 15 deadline.
Summ is designed to meet the rigorous reporting standards of the IRS.
Simply connect your exchange accounts and wallets and let our software do the rest. It will analyse all of your transactions – including complicated activities like DeFi – and produce a tax report ready for the IRS.
A single plan lets you download reports for all previous tax years, so if you’re behind on your reporting we’re here to help you catch-up.
The information provided on this website is general in nature and is not tax, accounting or legal advice. It has been prepared without taking into account your objectives, financial situation or needs. Before acting on this information, you should consider the appropriateness of the information having regard to your own objectives, financial situation and needs and seek professional advice. Summ (formerly Crypto Tax Calculator) disclaims all and any guarantees, undertakings and warranties, expressed or implied, and is not liable for any loss or damage whatsoever (including human or computer error, negligent or otherwise, or incidental or Consequential Loss or damage) arising out of, or in connection with, any use or reliance on the information or advice in this website. The user must accept sole responsibility associated with the use of the material on this site, irrespective of the purpose for which such use or results are applied. The information in this website is no substitute for specialist advice.
FAQ
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Nick Waytula
Head of Tax
Nick is a licensed attorney and the Head of Tax at Summ (formerly Crypto Tax Calculator), with over 6 years of experience in the crypto tax space. He has previously held key roles at Deloitte and TurboTax, focusing on digital asset taxation and blockchain compliance. At Summ, Nick helps drive the development of a leading software that enables taxpayers around the world to accurately and efficiently complete their crypto taxes.
Compare the best platforms for managing Form 1099-DA reporting, calculating cost basis, and reconciling exchange data with your actual transaction history.
Received a Form 1099-DA from Coinbase Prime? Here's What to Do Next
Coinbase Prime has started issuing Form 1099-DA to U.S. crypto traders for the first time. This quick guide explains what the new 1099-DA means, why you received it, what's missing from the form, and the exact steps you should take next to avoid overpaying on crypto tax.
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Blog
08 April 2025
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Min read
The Hidden Crypto Tax Crisis
New research by Summ (formerly Crypto Tax Calculator) shows that 70% of Americans don't understand their crypto tax obligations. Here's what needs to change.
Nick Waytula
This tax guide is regularly updated: Last Update
....
April
8
2025
Starting this year, crypto exchanges start collecting your detailed transaction data to share with the IRS. If you’ve been unsure about how to report your crypto on your taxes, you could already be at risk of an audit.
To help clear things up, we surveyed 1,516 American Crypto Traders and discovered the biggest misconceptions about crypto tax.
We found that an overwhelming majority of Americans are making mistakes that put them at a heightened risk of an audit by the IRS.
Here's what you need to know if you want to stay on the IRS' good side this year.
Misconception #1
{{hidden-crypto-tax-crisis-callout1}}
Misconception #2
{{hidden-crypto-tax-crisis-callout2}}
Misconception #3
{{hidden-crypto-tax-crisis-callout3}}
The Rising Pressure from Regulators: Global and U.S. Compliance Crackdowns
While United States crypto investors remain unclear on their obligations, regulators are tightening oversight, requiring greater transparency in crypto taxation.
In the U.S., 1099-DA reporting now mandates centralized exchanges to report transactions to the IRS, while CARF, adopted by over 50 OECD countries, sets a global crypto tax standard. These efforts aim to close tax gaps and enforce compliance.
Crypto traders must evolve past outdated assumptions about anonymity and taxation. New regulations mean the IRS has more tools than ever to enforce compliance.
With the new data-sharing arrangements starting this year, the age of excuses is over – taxpayers need to get their reporting in order to avoid stiff penalties and fines.
But you still have time to act before the April 15 deadline.
Summ is designed to meet the rigorous reporting standards of the IRS.
Simply connect your exchange accounts and wallets and let our software do the rest. It will analyse all of your transactions – including complicated activities like DeFi – and produce a tax report ready for the IRS.
A single plan lets you download reports for all previous tax years, so if you’re behind on your reporting we’re here to help you catch-up.
Discover savings opportunities and lower your tax with Summ
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Frequently asked questions
How is crypto tax calculated in the United States?
I lost money trading cryptocurrency. Do I still pay tax?
The way cryptocurrencies are taxed in most countries mean that investors might still need to pay tax, regardless of whether they made an overall profit or loss. Depending on your circumstances, taxes are usually realized at the time of the transaction, and not on the overall position at the end of the financial year.
How do I calculate tax on crypto-to-crypto transactions?
In most countries you are required to record the value of the cryptocurrency in your local currency at the time of the transaction. This can be extremely time consuming to do by hand, since most exchange records do not have a reference price point, and records between exchanges are not easily compatible.
How can Summ help with crypto taxes?
You just need to import your transaction history and Summ (formerly Crypto Tax Calculator) will help you categorize your transactions and calculate realized profit and income. You can then generate the appropriate reports to send to your accountant and keep detailed records handy for audit purposes.
Can't I just get my accountant to do this for me?
We always recommend you work with your accountant to review your records. If you would like your accountant to help reconcile transactions, you can invite them to the product and collaborate within the Summ web app. We also have a complete accountant suite aimed at accountants.
Does Summ handle non-exchange activity?
Summ (formerly Crypto Tax Calculator) handles all non-exchange activity, such as onchain transactions like Airdrops, Staking, Mining, ICOs, and other DeFi activity. No matter what activity you have done in crypto, we have you covered with our easy to use categorization feature, similar to Expensify.
Do I have to pay for historical tax reports?
Our subscription pricing is per year not tax year, so with an annual subscription you can calculate your crypto taxes as far back as 2013. The process is the same, just upload your transaction history from these years and we can handle the rest.
Can I use my own accountant?
Yes, Summ is designed to generate accountant-friendly tax reports. You simply import all your transaction history and export your report. This means you can get your books up to date yourself, allowing you to save significant time, and reduce the bill charged by your accountant. You can discuss tax scenarios with your accountant, and have them review the report.
How does payment work?
Summ has an annual subscription which covers all previous tax years. If you need to amend your tax return for previous years you will be covered under the one payment.
What if my exchange is not on the list of supported exchanges?
Summ covers thousands of exchanges, wallets, and blockchains, and DeFi apps, but if you do not see your exchange on the supported list we are more than happy to work with you to get it supported. Just reach out to [email protected] or via the in-app chat support feature and we will get you sorted.
Does Summ support NFT transactions?
We do! Summ integrates with many NFT marketplaces and offers categorization options for any NFT-related activity (minting, buying, selling, trading).
How does the free trial work?
Summ is free to use immediately upon signup, allowing you to import your transactions and take advantage of our smart suggestion and auto-categorization engine, portfolio tracking, DeFi and NFT support. For access to reports, the tax loss harvest tool or chat and priority support, you will need to upgrade to the appropriate paid plan.
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We conduct regular and thorough Security & Awareness training for all employees.
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Our application only ever requires 'read-only' access to your data.
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