Coinbase, a US exchange and wallet provider, just released a tax reporting tool to assist users in filing to US authorities.
The company shared this information in a blog post, stating that some individuals could use its form generation options to determine the amount of tax owed on cryptocurrency gains ahead of this year’s Internal Revenue Service (IRS) reporting deadline, which is April 17th.
After several years of struggle between the IRS and Coinbase, involving court battles to determine whether the company was aiding in tax evasion by its users, this move will hopefully help move things in a positive direction.
“For our customers who have only bought or sold digital assets on Coinbase, we offer a tool that automatically calculates your gains or losses based on a first-in-first-out (FIFO) accounting method,” the post explains, stating that other calculation options are also available.
There may be a limited amount of Coinbase users who are actually eligible to use the new service though. Coinbase has shared a list of circumstances that will exempt a person’s account history from being compatible. These events include participation in an ICO, or having used another exchange.
The company says that anyone who has sent or received digital assets from a non-Coinbase wallet, bought or sold digital assets on another exchange, participated in an ICO or previously used a method other than FIFO to determine gains/losses on digital asset investments, sent or received digital assets from another exchange or stored digital assets on an external storage device will be unable to use the report to calculate their taxes owed.
Coinbase is not the first company to provide a tax calculation service to its customers. Last year, another US startup, Node40, launched calculation software that was originally focused on Dash, but it ended up expanding to other currencies, including Bitcoin.