Nicholas Slettengren is a Digital Marketer by trade and Crypto Entrepreneur by evolution. His new company Count on Sheep is becoming a leader in Crypto Accounting for both B2C and B2B clients. He is joined by Founding Employee and CPA Justin Zanardi.

Apple | Spotify | iHeart

Guest Resource

Count On Sheep – Book a meeting with Nick and Justin for a free consultation.

3 Value Bombs

1) Crypto currencies are not private. It is the world’s first distributed global ledger and everyone has access to it including IRS.

2) When it comes to reporting Crypto taxes first you have to make sure you have all the data in one place and second is that all the data are reconciled by the right professional who can help you get the accurate results.

3) Market moves up and down and typically we are always focused on the moving up. We have to also focus on the moving down. Know how to take a loss against your future gains.

Show Notes

**Click the time stamp to jump directly to that point in the episode.

Today’s Audio MASTERCLASS: Saving BIG On Your CRYPTO TAXES!

[1:28] – Nick talks about why the belief that crypto currencies is anonymous and doesn’t need to be reported is not true.

Crypto currencies are not private. It is the world’s first distributed global ledger and everyone has access to it including IRS.
Another thing is people try to do it by themselves by using software that are just good with aggregating data but not good in the actual accounting processes in getting the best savings in their taxes.

[2:51] – Justin adds to this point,

The IRS is watching, and trading anonymously is far from the truth. They can see every interaction and knows what you are up to.

[3:37] – Justin shares what are the proper steps when it comes to reporting crypto taxes.

First, make sure you have all the data for completeness and accuracy and that all exchanges and wallets are in one place. Second, reconcile all the data and find the right professional to help you to get the accurate results.

[4:32] – Nick adds to this point.

There are different software s so you need first to aggregate the data, reconcile the data and make a copy to send to a CPA.

[5:47] – Nick tells what are the mistakes that cause people to lose money when attempting their own crypto taxes.

He first started doing his own Crypto taxes then later hired 2 CPA from different states to help him figure it out. Both gave different results and no one got it right so he did more research and found a young employee who was specialized in Crypto taxes. She helped and guided him to all his tax things.
His biggest mistake was that he was trained in multiple exchanges and every time he switch to an exchange it defaults to being sold and is taxed. But when it is transfer, it is not taxed. So it is important to tag and reconcile your data correctly to save taxes.

[8:25] – Justin gives his example to this mistake.

They have a client with ac Coin Based account and a Coin Based Pro account and all the transfers of those accounts were not synced and each transfer looks like a sell and the re-buy. When they first populated the software, the client had $700,00 capital gain but after the reconciliation process with them, he had a $1500 lost. If he went with the software, he would have a hugely unfavorable capital gain.
It is really important to always look at your transfers from one wallet to another.

[10:18] – A timeout to thank our sponsors!

HubSpot: Starting a business doesn’t have to be so hard. Go to ClickHubSpot.com/ent to download HubSpot’s Entrepreneurship Kit for free right now!
Airbnb: Your home might be worth more than you think… Find out how much at Airbnb.com/host!
Thought-Leader: Ever thought about giving a TEDx talk? Visit Thought-Leader.com/fire to join a free training and learn how to land a TEDx Talk and spread your message to millions!

[13:04] – Justin sheds some light to Tax-loss Harvesting and cost basis modelling.

First thing to know is that Crypto currency is not a security but it is a property.
Crypto is different from Stocks because you can immediately re-buy what you loss.
Having a professional who can generate all this reports that show all your different tax lot and start planning different scenarios is the key to save taxes.

[14:44] – Nick gives his addition to this.

Market moves up and down and typically we are always focused on the moving up. We have to also focus on the moving down. Know how to take a loss against your future gains.
In cost based modelling, you need a professional to get in and turn the levers by applying the tax based model so you can save hundreds or even thousands of taxes.

[17:40] – Nick talks about some specific examples of how some crypto companies are handling

their internal Crypto Accounting.

A lot of companies are not handling it very well because they don’t have proper wallet hygiene. There are big slush fund and are not streamlined in using Crypto.
They are looking to educate people in their wallet hygiene by taking Crypto currency, reconcile in the corporate side and push it through their ERP.

[19:35] – Justin talks about what IRS forms to look out for if we continue to not pay our Crypto taxes.

5174 – IRS tells you that you have not reported everything and to rethink what you have reported.
6174A – IRS tells you that you have reported everything but the IRS encourage you to amend your return.
6173 – This is a warning letter indicating that the IRS have an information that you have not reported and make the amendment. If you failed to respond, IRS will send another letter to threaten you.
CP2501 – IRS tells you that there could be a discrepancy in the return.
CP2000 – IRS tells you that you have not reported everything and that you need to respond.

[21:51] – Nick shares his thoughts on Crypto becoming a political weapon.

There are 2 politicians who are having a Pro stance about Crypto and has Crypto Currency Policy in their platforms.

[23:10] – Nick shares his takeaway.

IRS has all the information so get in front of your taxes, don’t wait to be audited.

[24:20] – Justin gives his takeaway.

Aggregate your data into a software and get the professional that can help you in saving taxes. Don’t wait for something bad to happen, stay ahead, pay your taxes and all are good.

[25:14] – Call to action.

Count On Sheep – Crypto Tax Preparation and Crypto Bookkeeping. Book a meeting with Nick and Justin for a free consultation.

[26:51] – Thank you to our Sponsors!

HubSpot: Starting a business doesn’t have to be so hard. Go to ClickHubSpot.com/ent to download HubSpot’s Entrepreneurship Kit for free right now!
Thought-Leader: Ever thought about giving a TEDx talk? Visit Thought-Leader.com/fire to join a free training and learn how to land a TEDx Talk and spread your message to millions!

Killer Resources!

1) The Common Path to Uncommon Success: JLD’s 1st traditionally published book! Over 3000 interviews with the world’s most successful Entrepreneurs compiled into a 17-step roadmap to financial freedom and fulfillment!

2) Free Podcast Course: Learn from JLD how to create and launch your podcast!

3) Podcasters’ Paradise: The #1 podcasting community in the world!

Saving BIG On Your CRYPTO TAXES with Nicholas Slettengren

Subscribe

Guest Resource

3 Value Bombs

Sponsors

Show Notes

Killer Resources!

Subscribe