Cryptocurrency hardware wallet provider Ledger is deploying ZenLedger’s technology to tackle a surge in tax audits that have targeted individuals ‘hodling’ cryptocurrency. The move aims to resolve tax dilemma since it produces a variety of tax filing formats that the IRS often requires.
Users can easily connect ZenLedger solution with their Ledger Live, a proprietary interface application created for users transacting with digital assets through Ledger’s line-up of hardware wallets. Once plugged in, all of their transaction data will be pulled from the wallet into ZenLedger software. This would provide them with a tax liability dashboard, which gives them better visibility into the tax impact of their crypto transactions.
ZenLedger software automatically aggregates the history of all crypto transaction types such as mining, staking, lending, gifts, or even exchange rewards like airdrops and forks.
Additionally, ZenLedger helps file more accurate tax returns, monitors tax liability and highlights potential tax refunds. Customers can see the real-time tax impact of their transactions, as well as receive trade alerts when tax saving opportunities are available.
ZenLedger supports and connects with over 400+ exchanges, 7000 token types, 30+ DeFi protocols, ERC-721 NFTs and all wallets.
For Jean-François Rochet, VP International Development at Ledger, comments: “Ledger Live is an all-in-one app for everything in crypto, NFTs and Web3. The integration of ZenLedger shows how many things you can do with this app. With ZenLedger made available, Ledger Live now is a gateway to simplify crypto tax reports.”
Ledger provides fiat on-ramp for wallet users
Recently, there have been numerous reports emerging of tax authorities clamping down and going after cryptocurrency traders. The US Internal Revenue Service (IRS) also sent letters to taxpayers who might have failed to report income and pay the resulting tax from cryptocurrency transactions.
At the very core, the IRS still deems crypto assets to be property rather than currency for income tax purposes, the same as its regulatory guidance came out six years ago. That means the authority will continue to tax crypto profits and losses like those for stocks, at capital gains rates.
Ledger announced in March that users of its popular crypto hardware wallet are now able to purchase cryptocurrency directly in the App with bank cards after it has inked a partnership with Canadian payments firm Nuvei.
The agreement gives Ledger users a fiat onramp to conduct and settle crypto transactions, a grey area of business where a gauntlet of KYC requirements and other regulations kick in.
Specifically, the integration provides Ledger users with direct access to purchase 125+ cryptocurrencies using all the leading fiat funding options, including through Visa, Mastercard, SEPA, and SWIFT. The process can be done without having to go through external exchanges and fiat-to-cryptocurrency payment gateways.