Libra Opens the Doors of Its Bitcoin Tax Software to Developers This Tax Season
To kick off tax season, Libra has just released a tax compliance developer kit for Bitcoin wallets, exchanges, payment processors, and other digital currency services. Now, anyone developing software in the bitcoin ecosystem or on top of blockchain technology can easily provide their customers tax compliance in minutes.
Less than one year after the IRS issues guidance on 'virtual currencies' in Notice 2014-21, and just in time for tax season this year, Libra's new technology offering solves one of the toughest problems for the digital currency space: proper bookkeeping and tax compliance.
"The fact that digital currencies like Bitcoin are classified as 'property' by the IRS creates a terrible accounting headache for both individuals and businesses that have Bitcoin on the balance sheet," says Libra's CEO Jake Benson, "so while we have this exciting new technology that the world, Microsoft even, is just starting to get acquainted with, there is still an exorbitant amount of administrative overhead that accompanies dealing with digital currency as an asset."
To summarize the issue, nearly every bitcoin transaction between two parties is a taxable event where cost basis must be determined. Furthermore, the recognition of income is not only dependent on the price of bitcoin, but a capital gain or loss must also be tracked and reported. Gifts or donations are also accounted for differently. Without specialized software, the task is extremely time consuming, and at scale, virtually impossible. Existing accounting software is just not built for this type of activity.
Nick Sullivan, CEO of ChangeTip, says, "Libra's software is going to help us move past one of the more daunting issues, which is tax compliance. Integration will help our users when it comes to managing deductions for donations to charities and causes."
Libra has more to deliver this tax season, too. A web series titled the "Future of Money" will conduct an interview every Monday with an accounting professional that has experience with individuals or businesses invested in digital currency. In addition to 'LibraTax,' software for individuals, an entire software suite is launching over the next 3 weeks that will cater to businesses, accounting firms, and CPAs.
For more information about Libra, please visit http://www.libratax.com/