Tax Time

Cointracker Crypto Tax Compiler - Why Tax Reporting Pisses Me Off

By R23 | Supportive Crypto Community | 2 Feb 2022


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I personally don't understand how we as a society (America specifically here though I think it is the same around the world) allow for such heavy taxes to be imposed upon us without a real say in how they are spent and why tax returns need to be filed at all.

A few of my friends are accountants, so the other day I asked them as politely as humanly possible why we even have to file tax returns. They responded that it is a process made up by the government to get more money from people. Either they overpay because their calculations were off, or they underpay and get hit with fines or even jail time as a result.

It's absolutely ridiculous. The IRS knows exactly how much money they are owed from each person by using an algorithm linked to your social security number and thus linked to all KYC verification methods. You have to file a tax return because they literally want you to mess it up...

The amount of privacy that is given up by providing your information to KYC verifications is something that is rarely discussed in the mainstream. Everyone is perfectly happy to live in ignorance as we are tracked across literally every application we use and every key stroke is recorded in order to maximize the amount of profit we will provide the data collectors.

Cointracker is a new protocol being used that allows you to aggregate all of your centralized exchange accounts into one tax report. It is wildly efficient in getting the job done, but is also incredibly invasive. I always thought that cryptocurrency was supposed to enhance privacy and allow for the flow of money detached from the government, but it has actually spurred innovations to increase control. I guess the only thing that is private for now is what happens on hardware wallets and things connected to decentralized exchanges. However, with a little bit of work even that can be pieced together with a high degree of accuracy as to what account is run by who. In addition, the only way to get your investment into fiat currency other than P2P transactions is to sell it on an exchange linked to your bank account.

As far as I can tell, there is very little privacy in the cryptocurrency space if you ever want to turn that currency into fiat; something that is still pretty much necessary to have any spending power with your holdings.

Please correct me if any of this rant was wrong, I beg you.

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My name is Rob and I am a prospective law student with interests in cryptocurrency and blockchain. I have enjoyed my time thus far engaging with Web 3.0 and am looking to continue learning more and sharing what I learn through my experience

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R23
R23

A new cryptocurrency investor looking to learn as much as possible about smart contracts and coding!


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