This article has been updated to indicate the following: “Due to upcoming regulation changes from the IRS that require exchanges to implement per wallet cost basis methods, CoinTracker will disable Universal cost basis tracking as an option for US users.“
This is very worrisome. Universal cost basis tracking in tax reporting by individuals is absolutely still permitted in the US. It is and will continue to be widely used. The fact that exchanges must begin to implement per wallet cost basis in their reporting does NOT mean we must implement it in ours.
Why then would CoinTracker remove our option to use the universal method in our reporting? For now, I am baffled.
CoinTracker: Please advise.
+1, this change doesn’t make any sense, and would completely break past reporting, and create a mess for existing users.
Also, can someone from CoinTracker please link to the “upcoming regulation changes from the IRS”? I wasn’t able to find anything on a quick search. And even that’s really the case, the current regulation clearly states that:
A38. No. If you transfer virtual currency from a wallet, address, or account belonging to you, to another wallet, address, or account that also belongs to you, then the transfer is a non-taxable event, even if you receive an information return from an exchange or platform as a result of the transfer.
(it doesn’t actually say anything about cost basis, but given wallet-to-wallet transfers are not a taxable event, it doesn’t make sense to actualize the cost basis)
+1, replying to raise awareness, priority, and “activity metrics” to hopefully get a response out of CoinTracker quicker.
OK, so I am now looking at millions of dollars of gains in each of the multiple previous years post the update that was rolled out today. Yet again I need to manually go through thousands of DeFi transactions and figure out what is incorrect (which is by the way much harder and time consuming to do with the new UI).
Why can there not be a switch that allows me to keep all previous accounting exactly as it was already filed with the IRS even at the risk of me “not being compliant with the new IRS new standard” (which I am yet to see a proof of)?
I don’t even know where to begin expressing my frustration with the product… Every tax season I essentially need to re-work my entire transaction history to have some resemblance of consistency between the years, which is taking tens of hours. This makes my calculations error prone and greatly increases chances of an IRS audit going forward if I do end up amending multiple years of past tax returns.
The FAQ received over email talking about “the new accounting engine” basically just says “you are screwed, hire help” and leaves us with that. It also says “As a result of the upgrade, you will see a significant increase in your total capital gain calculations across prior years” - yes we see it, but why is that, how do we fix it, what are we even looking for?
Understand that there will be no response from the team (as it was the case for multiple tax seasons), but question to others who are like me now in the same very unfortunate situation and stuck with Cointracker: what is your plan around reconciling past years returns with the new numbers?
Wow, they just updated it today. My universal wallet tracking is gone, and now it’s just by wallet. I have problems all over my portfolio. What a disaster. I am so frustrated - this entirely unnecessary. And it’s not requried by US law.
Cointracker: please advise! And restore our option for universal cost basis tracking!
I have the same issues. Too many changes to the prior years to fix. Literally over 1,000 transactions to fix and re-confirm. I had to do this last year and it looks like I’ll spend the next several months going through all the changes and updating it. I also have an issue with multiple duplicate transactions showing up in prior years for Cardano wallets. Again, another issue that I need to go back and correct. It’s a total mess.
I am glad to hear that at least I am not alone in this…
What makes matters worse is that I can’t rely on Cointracker not to re-do all my historical calcs at any given point of time with no way of reverting the changes.
Cointracker, we need 1) universal tracking back as an option (you can set it not to be the default option!), 2) fees calc should be a on/off switch - it’s not currently implemented correctly, gas doesn’t get subtracted from ETH balance so I am manually adjusting each transaction 3) there absolutely has to be a way to restore previous calculations after major changes like this one get rolled out. We need responses ASAP!
Here’s the updated guidance by cointracker:
“The Per wallet cost basis tracking method allows CoinTracker to correctly match your gains & losses to 1099-DAs issued by exchanges and accurately carry forward the right tax lots for future years. Without this, your CoinTracker gains & losses will be out of sync with the gains & losses reported to you & the IRS by exchanges. Reporting gains & losses not consistent with 1099-DAs could lead to tax notices.”
Cointracker: It does not matter that our gains and losses be matched with 1099-DAs issued by exchanges. Nor does it matter that the IRS might send us tax notices. Showing the IRS our cost basis is the very reason we use your service.
Please, please, please, restore our ability to use universal cost basis tracking!
Totally agree. The exchanges do not have all the information about the cost basis of the crypto that was sent to their exchange to be able to calculate the gains and losses. I’m concerned there aren’t enough CoinTracker users complaining about this yet. Most people will not find out until later and it will be too late to make the corrections to file their taxes.
Need CoinTracker to allow users to revert back to the prior method.
I had tried several crypto tax suites and settled on CoinTracker. I like everything about it. But this change is now making me reconsider that decision.
@chandan we need answers!
This is unacceptable. CoinTracker, you seriously cannot F#ck people so badly this early in the tax season. This is so much worse than taking away the .txf file for download like you pulled last year. Why can’t I just pay you people and have a stress free year with my crypto tracking tax software. Some how I still pay to use every year. Not cool. FIX IT, I have way too much on my plate for this crap right now. …Seriously NOT COOL
I’m literally extremely anxious right now as a result of this. I had my crypto taxes all ready to go and with one fell swoop you guys ruined it. You cant do this to people!! I’m seriously F’d up over this right now.
You have no idea how many extra hours days and weeks I had to pour into my taxes last year because I couldn’t download my .txf file and was being forced to redo all of my taxes on the turbo tax online version when I already paid for turbo tax desktop version! and now this!? Happy Freaking New Year!!!
They need to have a way to choose the basis type.
Even if I wanted to switch to this method, I have no idea what tokens I may have already paid some portion of the capital gains on, e.g. 1 eth sitting in an address since 2013 will have been “used” in prior tax filings.
Not to mention the fact that I have lost all ability to reconcile past filings with my current dataset in this tool.
Not that I support this move at all, however at a very minimum they should have offered a “lock” option for all transactions previous to a selected date by the user. This would have prevented users from having past return report being adjusted and causing massive amounts of stress and time for their users. Since we are not getting any response from them, maybe “we” should hold a Twitter Spaces and see if they will respond or show up to it. This forum and their response via emails is not working whatsoever.
Hello CoinTracker community,
Thank you for sharing your feedback on the recent accounting engine changes, and in particular, the migration to “per-wallet” cost basis tracking. Your concern hasn’t been lost on us, and we’re actively discussing the insights you’ve shared with us.
We want to share with you why we’ve opted for this approach through our new FAQ document. The “per-wallet” cost basis tracking method helps ensure that our gain and loss calculations sync with those produced and reported by exchanges. Our belief is that an earlier transition will be easier for users to reconcile, though we do recognize that this may result in extra work for some users.
To better understand user needs, we also have this public feature request to allow US users to revert to “universal” cost basis tracking. If you’re interested, please add your upvote to this feature request and any additional feedback you may have for us to consider. Upvoting will also automatically subscribe you to updates as they become available.
We recognize that this is a major change for some of our users. If you would like to chat with our support team for individual assistance, please email us here (leave the subject as is) for priority support so we can assist you as soon as possible.
Thank you again for being a part of the CoinTracker community.
Hey all, since they have not put anything else out beyond the one reply, please see my reply to another string. Although I cannot attend, I think everyone here should jump on the Twitter Spaces they are holding tomorrow about UK taxes. Since they are the host, they should have representatives in the Space and should be able to get some real in person answers to our questions/issues. Tag or tell a friend that uses this and is having issues as well! https://twitter.com/CoinTracker/status/1618236567382020097