How to Avoid Tax Trouble with a Crypto Portfolio Tracker

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If crypto is giving you new headaches this tax season, a portfolio tracker could help you start planning now for a better experience next year.

With the rapid rise in cryptocurrency adoption over the past year, regulators are taking it more seriously than ever before, with the IRS even asking Americans to record their cryptocurrency activity for the first time.

“The IRS may not yet have the ideal infrastructure set up to track and evaluate crypto transactions,” he says. kate waltman, a certified public accountant who specializes in cryptocurrencies. “But what I can tell you is that it is an area of ​​focus.”

If you bought or sold Bitcoin, Etherealor other types of crypto last year, you must report earnings as taxable income. To make things easier, tech companies have developed new apps and software that can track what’s inside your digital wallets. Meanwhile, crypto exchanges like base of coins have added new integrations that can help users report accurate holdings.

Here’s a look at what crypto portfolio trackers are, along with information to help you decide if it makes sense to start using one.

What are crypto wallet trackers?

Crypto wallet trackers are third-party tools that link to your crypto wallets and provide an overview of your crypto holdings. Instead of manually tracking each transaction, users can sync their crypto wallet with their wallet tracker and extract all data comprehensively, including total profits and/or losses for the respective fiscal year.

Coin TrackingZenLedger and Koinly are some popular third-party tools that crypto investors might consider, says Waltman.

For both crypto newcomers and experienced traders, knowing your tax position before filing is critical to accurately paying taxes on potential capital gains or reporting losses. That’s especially important this year, given that 55% percent of Bitcoin Investors Reportedly Started Investing in 2021according to a study by crypto firm Grayscale Investments.

How do crypto wallet trackers work?

Each app works differently, but the best crypto portfolio tracker monitor the price changes of your crypto assets, show you the total value of your portfolio and point out prices every time you make a transaction.

Depending on which one you choose, the tracker may offer different features and integrations. For example, a tracker could synchronize your transactions across multiple crypto networks and block chainswhich means you could capture more crypto exchanges than applications that focus on a single blockchain at a time. You can also sync with popular exchanges (Geminifor example) and multiple types of crypto wallets to get an overall snapshot of your crypto activity.

As with individual shares or the sale of physical assets, crypto investors should expect to pay capital gains tax when they profit from the sale of virtual currency. What makes cryptocurrencies different is the lack of consistent reporting by exchanges to the IRS, although there have been signs in the last year that more rules could help clarify this in the future.

One thing that is clear is that the more business you have, the more complicated your tax return can be, especially if you are tracking your activity manually. Portfolio trackers can help investors keep accurate records that ensure you’re paying the correct tax rate based on your activity.

“If you had [your crypto] for less than a year, you would have a short-term gain and pay taxes at your regular regular tax rate,” explains Lisa Greene-Lewis, a certified public accountant and TurboTax tax expert. “If you had it for more than a year, then you pay long-term capital gains tax rates, which are more beneficial to most people.”

How do I keep track of my cryptocurrency portfolio in 2022?

Experts say that the best crypto tax programs integrate with multiple wallets, exchanges, and/or blockchains; In addition, they are compatible with regular tax programs such as TurboTax or TaxAct.

waltman and other tax experts we’ve spoken with I recommend CoinTracker for its tools and integrations. When in doubt, talk to a certified public accountant who specializes in crypto taxes.

While experts say accounting for crypto on your tax return is easy for those who simply traded crypto in online exchanges, you may want to consult an expert if you have mined cryptocurrencies or engaged in decentralized finance trading (including staking, pooling, and/or lending your cryptocurrencies).

You’re not sure where to start? Read about NextAdvisor crypto tax guide.

What are the best crypto wallet trackers?

Crypto is a booming industry, and there are a multitude of new products to track your holdings and transactions. You’ll want to consider cost, user ratings, wallet integrations, and cross-chain capabilities when deciding which crypto wallet tracker is best for you.

pro tip

Thoroughly compare the differences between the free plans before you opt to pay for a crypto portfolio tracking service. Some free options offer robust IRS reports. Others allow you to track a large number of transactions, but leave out the necessary forms.

Some trackers may charge for more trades, so you’ll want to factor that into your total tax preparation cost. And either way, it doesn’t hurt to work with your accountant and go over everything. “You can take advantage of third-party calculation tools to load your wallet data and try to determine what the capital gain or loss is for you,” says Waltman. “It’s always good to look at your data line by line and do a thorough check. Make sure you agree with it, even if you use a third-party service provider to do the calculation.”

In general, experts recommend sticking with crypto companies and platforms that are more established and have larger user bases, rather than smaller, niche service providers. That can be a good indication that the service offered will be delivered to investors. Also keep in mind that many crypto companies are startups, so their product offerings and pricing may change with the rapid growth of the crypto industry.

With all this in mind, here are five of the best options that cryptocurrency investors could consider. This list is not exhaustive, but it can help you start thinking about what to prepare for when reporting your cryptocurrency holdings for 2021. Each tracker offers different options, so you can consider what’s important to you.

Coin Tracking

CoinTracker is highly recommended by experts and offers the ability to sync well with IRS forms as well as TurboTax and TaxAct. But you have to pay for more advanced features.


  • $0 for up to 25 transactions
  • $199 per 1,000 transactions
  • Custom prices for unlimited transactions


  • Ability to export your transactions to a CSV spreadsheet

  • Offers tax forms, export to tax preparation software, and tax advisor referral (additional fees apply)

  • Calculate cost basis and capital gains

  • Support forum included with the free version

  • 30 days money back guarantee

token tax

While you can only integrate the free version with Coinbase and Coinbase Pro, TokenTax offers live chat support and unlimited tax form reviews.


  • From $65 for up to 500 transactions
  • $199 for transactions up to $5,000
  • $799 for up to 20,000 transactions
  • $3,500 for personalized VIP support


  • Automatically complete IRS Form 8949 or International Report

  • live chat support

  • Unlimited revisions of tax forms

  • 10% discount when buying multiple years


  • Free version only integrates with Coinbase and Coinbase Pro

  • No tax loss collection dashboard with the free version

  • No TurboTax integration with the free version

CoinLedger (rebranding of CryptoTrader.Tax)

With CoinLedger, you can sync unlimited trades and view profit and loss calculations, but the system does not offer a free plan.


  • $49 for up to 100 trades
  • $99 for up to 1,500 trades
  • $199 for up to 5,000 trades
  • $299 for unlimited trades


  • 14 day money back guarantee

  • You can sync unlimited trades

  • DeFi support included in the basic plan

  • Calculate profit and loss

  • Includes six tax forms: IRS Form 8949, Income Report, Capital Gains Report, Year-End Positions, Audit Trail Report, and Tax Loss Harvest

Zen Ledger

Although NFT support starts with the $149 plan, ZenLedger can integrate with TurboTax and analyze your current holdings.


  • $0 for up to 25 transactions
  • $49 for up to 100 transactions
  • $149 for up to 5,000 transactions
  • $399 for unlimited transactions


  • Analyze the performance and holdings of your current portfolio

  • Monitor prices in real time

  • Unlimited trades included in the free plan

  • Includes support for crypto income, donations, ICO purchases and donations

  • Includes tax loss collection, referrals from 3rd party crypto tax advisors (additional fees apply), and full tax reporting option (additional fees apply)


Koinly warns you if your balance goes negative and provides CSV spreadsheets of your trades. But you’ll need the $49 plan for most features.


  • $0 for up to 10,000 transactions (limited tax reporting however)
  • $49 per 100 transactions
  • $99 per 1,000 transactions
  • $179 for 3,000 transactions
  • $279 for more than 10,000 transactions


  • Import/export operations as CSV spreadsheets

  • Over 6,000 supported cryptos

  • 6+ years of historical spot prices

  • Negative Balance Warnings

  • Additional reporting and tax features for paid plans

Learn more: Here are 6 questions you may want to ask your tax professional.