Funding and Future Plans
In a spirited move to solidify its position in the cryptocurrency tax compliance arena, TaxBit has successfully raised $5 million during a seed funding round. Among the notable investors is Winklevoss Capital, the family office of the well-known Winklevoss twins. The funds will be instrumental in amplifying TaxBit’s software products on a global scale. With a growing user base full of everyday crypto enthusiasts, the company is setting its sights on expanding customer reach not just in the U.S., but also in Canada, the United Kingdom, and Australia.
The TurboTax of Crypto
TaxBit, often dubbed the “TurboTax of crypto,” harnesses a unique blend of expertise. Since its inception in January 2019, the firm has developed a robust tax reporting tool that automates the taxing processes for cryptocurrency users, exchanges, and merchants alike. CEO Austin Woodward emphasizes that the key to TaxBit’s success lies in its founding team, which includes certified public accountants (CPAs), tax attorneys, and skilled software developers, setting it apart from many competitors that lean heavily on software development without the necessary tax expertise.
Impeccable Tax Accuracy
When it comes to tax precision, TaxBit doesn’t cut corners. The platform is designed with a full transaction-by-transaction audit trail, making it a breeze for CPAs or IRS investigators to verify tax calculations. Woodward states, “We can facilitate any IRS crypto audits from start to finish,” which means users can avoid the hefty fees of hiring a CPA or attorney when tax season rolls around.
Keeping Up with Tax Regulations
TaxBit boasts a constantly evolving tax reporting solution that supports over 2,500 cryptocurrencies. In response to the IRS’s frequently changing tax guidelines, the platform is innovative, aiming for immutable, point-in-time, and accurate tax reporting. Woodward reassures users that, “We support any coin that is available on an exchange or wallet trading platform.” This robustness positions TaxBit as a serious player in the crypto tax reporting game.
Investors and Market Trends
In addition to Winklevoss Capital, the funding round attracted a roster of investors including Dragonfly Capital Partners and TTV Capital, showcasing a burgeoning interest in the intersection of cryptocurrency and tax regulations. The IRS’s comprehensive guidelines released in October 2019 indicate that about 150 million American taxpayers might need to answer timely questions about their cryptocurrency activities come tax season. With estimates suggesting that around 12 million tax returns involve crypto investments, it’s clear that TaxBit could be onto something big!
