In this article, I profile the best NFT tax software you can use to track your transactions and prepare for a tax return.
I spent most of December testing and trying different crypto and NFT tax software options and comparing them to each other. I wanted to track my portfolio and prepare in advance for a tax return.
I’ve used crypto tax software for several years, but the space is becoming more complex thanks to NFTs and DeFi.
Dedicated crypto and NFT tax software should identify ERC-721 trades by token ID. This means if bought NFT #1 followed by NFT #2 from the same project, the software should properly calculate the gains and losses NFT #1 and NFT #2 separately.
Easier said than done!
In this article, I’ll profile my preferred options. I bought the premium versions of each of these apps and tested them extensively. I uploaded 5,000+ trades across a variety of cryptocurrency exchanges and NFT marketplaces like OpenSea.
I evaluated these apps based on affordability and ease of use. I used them to generate a tax return for my personal NFT crypto portfolio and my business portfolio. The latter is more complex due to more NFT trades and some DeFi loans.
Disclaimer: I’m not a financial advisor or a tax expert. Obligations vary from country to country. I wrote this article to offer my impressions of crypto and NFT tax software. This content is purely for informational purposes only. So, speak to an accountant!
Before we get into my choices for NFT tax software, why even use this software in the first place?
Table of Contents
To Account For NFT Trades
Buying an NFT involves purchasing Ethereum with Euros or dollars first. If you’re selling, that means exchanging it for cryptocurrency and then Fiat currency. All of these trades incur capital gains taxes… or losses.
You could use the spreadsheet and the blockchain transaction entries to track these. But if you’ve purchased several cryptocurrencies or several NFTs, it’s difficult and stressful to track all trades, and your accountant is probably not going to understand a spreadsheet. NFT tax software can help reduce errors before tax return time and save time on reconciliations.
To Reduce Errors
Secondly, if you’re tracking NFT sales, you must total up all transactions, introducing more potential for error. Using this software, you can automatically total up what you’ve spent, received, and generate a more accurate return that your accountant can review before submitting. So, these types of software could save you money and avoid NFT tax pitfalls.
To Track Your Portfolio
I got into the cryptocurrency space in 2016. Over the years, I’ve bought dozens of cryptocurrencies and set up multiple wallets. Now, I have a collection of NFTs as well.
At the start, tracking my purchases was easy because they were all in one marketplace: Coinbase. But as I started buying more, it became incredibly difficult to see where everything was and their market value. For example, NFT tax software doesn’t support OpenSea directly. Instead, it syncs with a MetaMask wallet.
Using crypto and NFT tax software, you can see past and current exchanges and wallets and where your tokens and NFTs are held. So, it’s a good way of managing the net value of a Web 3.0 portfolio.
For Tax Loss Harvesting
Towards the end of the year, you can see which NFTs haven’t worked out and sell them at a loss. Depending on your country’s rules and an accountant’s advice, this could potentially reduce a tax bill. Seeing a potential tax bill in advance helps set aside money and avoid nasty surprises from the taxman.
Tips For Using NFT Tax Software
Crypto and NFT tax software are only reliable if they can access all your wallets and trades. Otherwise, garbage in, garbage out. Connect them using an API or the relevant blockchain or Etherscan addresses. Alternatively, download a CSV file of trades from all exchanges, hardware, and software wallets.
Gathering all this information is often the most significant issue, particularly if an exchange closes down or changes how its API works. Rather than preparing everything just before a submission deadline, gathering trade information and updating your software throughout the year is less stressful.
While this type of software auto-syncs with most crypto wallets, reviewing transactions manually and regularly reduces stress and time spent reconciling transactions. When I did this, I immediately spotted some trades that were actually wallet transfers.
Don’t expect 100% accuracy with NFT and crypto tax software. If you’ve used one marketplace for straightforward trades, this type of software reconciles as described. But if you’ve bought lots of NFTs, used DeFi, stake, or sent tokens to multiple wallets, expect reconciliation errors.
I asked a few users of NFT tax software for advice. One suggested, “Make sure you check your tax obligation using FIFO, LIFO, and HIFO.” These accounting methods First-In-First-Out, Last-In-Last Out, and Highest-In-First Out affect returns, so best consult with an advisor about what’s acceptable.
If you’ve spent any time on transfers, providing liquidity, or swapping tokens, expect to invest even more time preparing a tax report. Crypto and NFT tax are emerging spaces, and even the best solutions struggle to keep up.
Now, let’s dive into my NFT crypto tax software choices. Many options exist on the market, but these are the ones I paid for and that I tested extensively.
1. Cointracking
Cointracking.info is the granddaddy of NFT and crypto tax software. Founded in 2012, it claims over one million users worldwide. The company also works with tax advisors worldwide and receives funding from partners like Coinbase.
It’s the first cryptocurrency and NFT tax software I used in 2016, long before NFTs were popular. Cointracking is one of the more known portfolio tools in the marketplace. You can test the product without uploading any data or try it for free with a small number of transactions.
Pricing
Customers pay after uploading 200 transactions. Pricing starts at $10.99 per month, with discounts available for annual customers. You’ll need to pay to generate that tax report. If you’ve lots of trades expect to pay $54.99 per month, for the year. You can also use this service to find a financial advisor in your country who can prepare a report on your behalf.
Usability
CoinTracking computes data based on connected wallets, exchanges, or uploaded CSV files. It also provides helpful instructions for gathering all this information.
A dashboard shows the total value of coins and NFTs and current balances across exchanges and wallets. It also tracks balances per day, per exchange, or wallet.
I connected to an API on Coinbase and Kraken, added my hardware wallet address, and uploaded a CSV file. I’d relatively few issues adding my data, and the tool crunched my transactions quickly and easily. That said, if you follow my workflow, check your transactions for transfers inadvertently marked as trades.
Users can review trades on a list and edit them individually. CoinTracking eliminated most duplicates, but it’s best to review transfers between wallets and any that cause a profit or a loss.
The software provides news and metrics about individual coins and tokens and insights about market sentiment. In fact, Cointracking’s depth of information is overwhelming if you’re new to the space. But, it’s useful for day traders or those with lots of trades.
Using the average purchase price feature, I reviewed how much I spent on particular coins and my potential gains and losses. Its tax report was useful for a return several years ago. That said, you can give an accountant direct access to self-serve.
I also like how it enables setting up multiple accounts and controlling them from one dashboard. I use this feature to track a crypto portfolio I created for some friends several years ago. I also use it to separate personal and business transactions.
CoinTracking treats NFTs as tokens. It works well with more established NFTs, like World of Women. But, it doesn’t provide a huge amount of information about them, and you can’t really see what they look like. It missed some newer NFTs I minted, and it doesn’t treat each NFT within a project individually. That said, the value of the missed ones was negligible.
This tool is fast, affordable, and established. The big downside of CoinTracking is the learning curve. Although support is helpful, I spent several hours learning how to use the software, and I found the reconciliation process more cumbersome than other options here.
When I contacted support, they provided a fix for me over email. Unfortunately, reconciling NFT trades was unwieldy. It didn’t accurately track my profit and losses without a lot of manual intervention on my part.
Pros
- Relatively affordable thanks to a small annual fee
- Powerful reports for traders and investors
- Connects users with tax advisors
- Generating a tax report is quick and easy
- Fast
- Responsive support
Cons
- Expect a learning curve
- No way to visualize an NFT inside of the software
- Missed some minor NFT trades
- No mobile app
2. Cointracker.io
Cointracker.io claims over 500,000 users worldwide, and it’s received support from Coinbase and Y Combinator. It’s a crypto and NFT portfolio service available via a web browser and mobile app that resembles Coinbase.
Pricing
To access these features, users must pay for a tax report, which costs €180 or approximately $200. They also must pay a monthly subscription-based on their transaction volume. That ranges between $50 and $100 per month (or more) depending on the number of transactions.
CoinTracker is one of the more expensive crypto and NFT tax app I’ve tried. Whether you want to spend that much money or not depends on how much you’ve invested in this space and if you value visually pleasing software. I wanted to use it more but support took weeks to reply to one of my tickets so I moved on.
Usability
CoinTracker is one of the more polished and easy-to-use NFT tax services I’ve tried. I spent 20 minutes uploading my transactions into CoinTracker and connecting my wallets.
I encountered an issue with an export of transactions from Kraken. CoinTracker support said I needed to reformat my file before uploading. A minor inconvenience. Newer users can probably connect to Kraken via the API instead.
I also encountered an issue when some worthless Hokk coins were airdropped to my wallet, and I couldn’t remove them from my report. I asked support about it and didn’t receive a reply.
The CoinTracker dashboard shows the balance for every wallet. Some users like CoinTracker’s daily emails about portfolio balances and performance, but you can turn these off if you find them annoying. You can also see balances across individual assets and wallets after upgrading.
CoinTracker includes a dedicated NFT centre. Here, you can paste in an address and view all of the associated NFTs, when they were acquired, and their price.
It also links the NFTs on marketplaces like OpenSea and Rarible. It’s the only service here that handles NFTs in such an intuitive and visually pleasing manner. Pleasingly, CoinTracker tracks each NFT trade individually, meaning you can calculate returns more accurately.
Like the other services here, pick what country you’re based in and its tax requirements. In Ireland, that’s first-in-first-out. Then, you can generate a report to send to an account.
You can use the CoinTracker tax centre to review potentially errant transactions flagged by the software. It also includes some insights for the tax-loss harvesting, which can be helpful before the end of a financial year.
CoinTracker includes a Tax Preview centre, but it’s more advice than a dedicated feature. Basically, if you want to trade with a currency or a token, and are worried about capital gains tax issues, record it as a manual transaction before placing the trade. That way, you can calculate the tax impact in advance. This trick works in any good piece of crypto and NFT tax software.
CoinTracker also includes a DeFi centre. I didn’t test this feature as much. But it provides information on savings, pools, and DeFi loans.
Pros
- Visually pleasing interface
- Excellent web and mobile app
- Includes dedicated NFT and DeFi centres
Cons
- Expensive
- Some quirks with uploading transactions from exchanges manually
- Support slow to respond
3. Koinly
Launched in 2018, Koin.ly crypto tax software claims it’s possible to generate crypto tax reports in 20 minutes. It supports 20+ countries, including the United States, the United Kingdom, and Europe. It also integrates with Turbo Tax.
Today, I use Koinly because it supports preparing submissions for Revenue (The Irish tax authority). It also supports HMRC (The UK tax authority). In other words, it’s built with the needs of crypto and NFT investors worldwide and not only in the United States.
Pricing
The reports start at $49 per year. I spent $179 as I’d about 3000 transactions. You can also extra for auto-syncs. It costs $2500 if you want a Koin.ly support team member to manually review and fix errors in your report.
Usability
It claims to create a tax report in 20-minutes or less. That may be true if your transaction history is simple but don’t count on it. Like the other examples here, you can connect via an API, a wallet address, or upload CSV files. I recommend using a blockchain or Etherscan address as it’s the easiest and most reliable.
Koin.ly takes longer to update wallet transactions and balances versus other solutions, and it’s noticeably slower overall. Updates are also released less frequently versus other solutions here.
On the Koin.ly dashboard, you can see the total portfolio value, how much you’ve spent, and unrealized gains. You can also see the value across individual currencies, how much you’ve received, and expenses. Koin.ly doesn’t offer much analytics about specific coins and tokens. The markets section provides price information. It’s less overwhelming, for better or worse.
After connecting and syncing your wallets, go to transactions and review the warnings Koin.ly flags. I suggest reviewing transactions by highest gains and losses because this is a good way to spot potential errors in a report. To be honest, it took me a few hours to generate a usable tax report, but it was easier to reconcile than other examples here.
First, set your region and accounting method, i.e. first-in-first-out, etc. Then, download a PDF report or share access with an accountant. It provides capital gains and losses for a given year and includes information income and airdrops.
Koin.ly recently rolled out support for individual ERC-721 entries or NFTs in February 2022. For NFT trades prior to this date, either reimport your wallet or record them manually as “null tokens”. That’s a placeholder entry in your ledger, and it takes time to add or update each entry if you’ve lots of trades.
This article explains how to process NFT trades manually in Koin.ly.
In summary, Koinly is easy to use and affordable, but it’s slow. You can add transactions relatively quickly and generate a useful tax report, but it doesn’t support NFTs trades directly like other apps here. I use it for managing my personal portfolio only, which is relatively straightforward.
Pros
- Affordable
- Creating a tax report is quick and easy
- Relatively few reconciling wallets and transaction history
- Supports many countries
Cons
- Advanced traders may find the metrics lacking
- Syncing wallets is much slower than other solutions
- Software updated less frequently than other tools here
4. CrytoTaxCalculator
CryptoTaxCalculator.io is a newer type of crypto and NFT tax software launched in 2018. Developed in Australia, it supports over 100 crypto exchanges, including NFTs.
Pricing
Pricing starts at $49 for the year. I spent $189 on my tax report based on some 3,000 trades. The app supports various accounting methods, including first-in-first-out, last-in-first-out, and more. You can also purchase a plan for your accountant.
Usability
Using CryptoTaxCalculator, I pasted in my addresses, and it pulled through all of my transactions within about five or 10 minutes. I liked how CryptoTaxCalculator presented my balances across each exchange and wallet.
You can see the overall balance for your portfolio, cost basis, and unrealized gains on the central dashboard. You can also see the winners and losers for purchases throughout the year.
The tax report flagged issues much like Koinly to review. It provided an overall gain and a downloadable PDF for an accountant. The tax report summary also provided information about gains across specific currencies. I spent about two hours fixing issues and reviewing some 100+ warnings.
CryptoTaxCalculator handles NFTs similarly to Cointracking. It records each NFT as individual purchases, even if they’re in the same project. You can’t really visualize your NFTs, though you can always do that using OpenSea or the Rainbow app on a Ledger hardware wallet.
CryptoTaxCalculator offers a good balance between functionality and price. However, while using CryptoTaxCalculator, the app logged me out repeatedly. It’s also a little clunkier than other apps, and it had issues with my Daedulus wallet. When I contacted support, they replied to my queries within 12 hours.
Pros
- Supports NFTs
- Good balance between affordability and usability
- Supports DeFi
Cons
- Less polished than other crypto and NFT tax apps
- DeFi features only available more expensive plans
- Less support for countries than other apps here
5. Token Tax
NFT collectors from the Cyberkongz community recommended I try Token Tax. It’s popular in the United States.
Pricing
TokenTax isn’t cheap. It starts at $65 per month, but that only gets you support for 500 transactions plus the Coinbase API i.e. it’s not enough. You’ll need to pay $199 per year for all exchanges, DeFi and NFTs. You’ll have to pay either $799 per year if you’ve more than 5000 trades or used margin trading. Don’t expect a free trial or refund.
TokenTax also offers a VIP service that costs $2,500 per tax year. I ended up choosing this option as my trades were too difficult and time-consuming to reconcile without help.
Usability
I connected my various accounts using an API and also uploaded CSV files from exchanges. Of all the NFT tax software options I’ve tested, TokenTax compiled my trades the fastest. I was also able to upload CSV files on a single screen rather than navigating to different places throughout the NFT tax app, for each exchange and marketplace.
If you’re in the US, you can generate a prepopulated 8949 Form for the IRS or ask TokenTax to submit it on your behalf. Those outside the USD get a reconciled CSV file for their accountant.
Token Tax simply records all purchases, sales and trades, and your profits or losses. It also records NFT trades accurately. You can also use this NFT type software to figure out what to sell in advance, thanks to its tax-loss harvesting feature.
It’s not, however, a tool for monitoring the performance of your portfolio or for keeping tabs on how much crypto an NFT you own. Also, don’t expect any charts or data about your profitability like the other tools here.
Pros
- Excels at NFT tax reconciliation
- Great, prompt support
- Simple, easy-to-use interface
- Tax-loss harvesting feature can save you a lot of money
Cons
- No tools for portfolio management
- Pushes users towards the VIP service
- Pricey
NFT Tax Software: The Final Word
I use Koin.ly to track my personal NFT and crypto trades as that portfolio is relatively straightforward. I use the TokenTax VIP service for my business trades which are more complex.
Previously, I used CoinTracking.info but I found it too cumbersome for NFTs. I wanted to like Cointracker.io but the bugs and unresponsive support put me off.
Accointing, ZenLedter, and Bitcoin tax are other popular solutions that I didn’t test to the same extent, but which some find useful.
NFT tax software is helpful, but you still need to work with an accountant or financial advisor to get the best tax advice. Remember to review and validate the transactions yourself, even if you’ve manually imported everything, to ensure that they’re accurate. If you’ve thousands of trades or spent time using DeFi, you’re probably going to have to pay extra for VIP service.
Consider this software as a tool rather than a gospel. In other words, if you’re going a trade, use them as a way of figuring out the potential tax implications of your trade before you go ahead and make it.
These are the apps I regularly use that I’ve tested extensively and paid for. Remember, if you’re going to use these apps, ensure all of your transactions are accurate: garbage in, garbage out. Before submission, don’t forget to work with your accountant or a financial advisor who understands web 3.0.
In the below NFT Tax video, I cover the first four options. If you’d like me to profile TokenTax in detail, let me know.
