Alice Ko is  founder of digital marketing agency Pivot Six, CPA and CA graduate from KPMG, and helps companies understand how to maximize opportunities of blockchain applications specific to their industry.

Tax season may be over for some (and just starting for others) — but don’t breathe a sigh of relief just yet. This is a perfect opportunity to do a debrief of what worked — and what didn’t work in your tax process this past year.

To help you get organized and better prepared for next year’s tax season, we spoke with Stephanie Linder, Community Manager for Crypto CPAs, and Andrew Perlin, Co-Founder of Crypto CPAs.

Crypto CPAs specializes in helping cryptocurrency holders in the United States with tax and accounting services, and they gave me some valuable guidance on the best ways to get your documents and transactions in order now, for a more seamless tax season next year.

Alice: What are three essential accounting priorities that a cryptoasset holder should get in place now?


“Although there is a hard date to file your tax return, tax planning actually never ends.

  • Anyone holding cryptoassets should immediately calculate what their realized, and unrealized gains and losses are. You can do this yourself or with your accountant. Knowing this information will help you decide which coins you should sell, trade, or hold. You may want to hold certain coins to purposely trigger, or not trigger a gain or loss.”

*Note: Unrealized gains and losses are any gains and losses that exist on ‘paper’ before the actual sale of the assets. Once assets are actually sold, the gains or losses become realized.*

“2. Catch up on your trade history. If you have used decentralized exchanges such as Shapeshift, make sure you document your trades on Excel or any kind of tracking tool while the trades are fresh in your head.”

“3. Don’t forget about your estimated quarterly tax payments! You are still required to make your estimated tax payments based on your previous year’s end of year tax liability, or what your tax liability will be in 2018.”

Alice: Your firm helps people account for and file taxes on their cryptoholdings. What were the three biggest mistakes you saw from clients from an accounting and tax perspective in regards to their cryptoassets this past year?


“There were a few tax mistakes I saw. A better term is probably ‘learning curves’ because this market is changing so rapidly (and still continues to!)

The three tax mistakes I saw were:

  1. Thinking you can trade as many cryptocurrencies as you want, and not be taxed on it. This is incorrect, at least in the United States because cryptocurrency is considered ‘property’ and therefore each trade is taxable. Trading cryptocurrencies has created large gains for many people, but these gains can also cause subsequent headaches if they are not reported properly for tax purposes.
  1. Not cashing out a portion of cryptocurrency gains to pay taxes. It is imperative that you set aside cash from trading profits in order pay your tax bill, especially if 2018 ends up being as lucrative as last year was. Many people did not cash out their cryptocurrency gains, even though they ended up with tax bills as large, or even larger than their cryptocurrency holdings!
  1. Not keeping track of purchases that were paid for using Bitcoin. Every time a transfer of bitcoin is made to or from a wallet, you should have a record of exactly what it was for, just like a regular purchase.”

Alice: More and more people will be buying, selling and trading their digital currencies and coins this year. What kind of investment advice does CryptoCPAs give to clients?


“We don’t give investment advice, we only give tax advice! But, it’s always a good idea to consider investing from a Self-Directed Roth IRA or Self-Directed Roth 401k. This can defer, and even eliminate the taxes owing from all crypto to crypto trades.

Also, be careful with margin trading as people are getting cleaned out.”

*Note: Margin trading happens when a trader borrows money from a broker to either buy or sell more stock than the trader would otherwise be able to do alone.*

Alice: I foresee a lot more accounting and tax regulations coming out in the next year across all different countries. What do the CryptoCPAs think is the most important regulation that cryptoholders to keep their eye on?

“We focus mainly on regulations in the United States since that’s where we are based. So in the United States, we are very concerned with the specific identification and tracking of cryptocurrency transactions.

There is no current regulation on whether to use the ‘First-In, First-Out method’ (FIFO) of accounting for cryptocurrencies. For instance, if this FIFO is applicable for accounting purposes, does a cryptoasset holder need to trace through the blockchain to search for the exact cryptocurrency that was bought or sold?

Although FIFO is considered a conservative method of accounting in times of little regulation or guidance, it doesn’t always make sense to use this method.

Other notable mentions to keep your eyes on are:

  • Whether Tax Trader Status applies and if it is appropriate to use the Mark-to-Market election
  • An official ruling on whether US citizens need to report foreign crypto exchange holdings on the FBAR (Form 114, Report of Foreign Bank and Financial Accounts).”

Alice: Stephanie, I know you’ve been interested in the crypto space for a while now – even before you got involved with CryptoCPAs! What resources do you use to educate and immerse yourself as learn about cryptoassets while running the online community for CryptoCPAs?


“I’ve found several resources that have been helpful.

I find joining various Facebook cryptocurrency groups is a good way to learn about what people are thinking and the cryptocurrency market in real time. However, sometimes you need to take things discussed in the groups with a grain of salt, because everyone has different opinions on cryptocurrency and which coins will flourish.  But as someone who’s still learning, Facebook groups are a great resource.

I also rely on local meetups in the cities that I go to. I’m a digital nomad (I am currently living in Medellín, Colombia) and I’ve discovered that many people in Medellín are investing in cryptocurrency or holding Meetups to educate others.

Again, it’s about knowing who to trust and take advice from. I think it’s also important to stay current with various news sources, such as CoinDesk, News Bitcoin and Miss Blockchain of course – who are credible resources within the industry.”

Alice: Stephanie, do you have any tips for other women who are interested in buying and investing in cryptoassets?


“Stay updated on current events. Do your research. Coins like Bitcoin and Litecoin have made their mark, but with new coins constantly coming into the market, everybody needs to make sure they do the proper research before investing substantially.

Do not invest more than you’re willing to lose. We don’t want to see anyone invest their life savings into one coin. Diversify.

Also, don’t be afraid to ask questions. Cryptocurrency is a new space and no one is expected to know everything so ask the questions! Asking questions does not make you look silly or dumb —  it actually makes you look smart and informed.”