Get Started with Cointracking.info
Start with the Demo
One of the things I like about Cointracking.info is they have lots of short training videos. In this chapter I’ll show you which ones are the most helpful. Plus, I’ll share some tips and secrets I’ve learned over the years. Remember I only like using Cointracking.info to determine capital gains and losses for a tax return. I don’t use it to track my balances. I just track trades and other crypto income.
Cointracking.info is the only crypto portfolio/tax software that I know which offers a live demo. Keep in the mind the fiat currency used in the Euro (EUR). Once you create your own account you set the currency to US Dollars or whatever is appropriate.
Just go to the website and click on Dashboard. All the data showing is demo data. Click on the Reporting tab and play around with the reports. You can also practice manually entering a single transaction under the Enter Coins tab and clicking on Overview and Manual Import. There’s a video for manual trade entry later in this chapter. Once you’re done playing with the demo go back to the dashboard and add a username and password.
Setup Account and Import Trades
After creating your account, the first thing you’ll want to do is add crypto trades. If you’re new to crypto, I recommend holding-off on entering manual transactions and instead start with importing CSV files. CSV files are spreadsheets that have no formatting. For convenience, some people prefer to use the API import feature, but I choose not to use it. Here’s why.
Why I don’t recommend the API import feature:
- Transactions sometimes don’t get imported, but you won’t know which ones
- Sometimes transactions get duplicated, but you won’t know which ones
- Various exchange API’s are not consistent. They don’t all send the same type of data
- Some send deposit and withdrawal info along with trades, others just import trades
Now that your trades have been entered, it’s a good idea to review the data. Start by clicking on the Reporting tab and select Trade List. This will give you a list of all your trades. Click on the blue plus sign of any trade to see the detail. If you have only a few trades then look at each one and make sure it’s correct.
Review Trade Data
For the first trade I’ve blocked in red, it tells us 0.0699 ETH was bought for 55 Euros (or think of dollars, $55). The price of ETH was $786.84 when the ETH was bought on 2-3-2018. Another way to review trade data is to run a tax report. If any trades are missing the report will show missing cost basis. What that means is the report shows that something was sold but it can’t find a corresponding transaction of when it was originally purchased.
Creating a Tax Report
This video walks you through the basic settings for running a tax report. When you setup a live account you’ll be able to run as many tax reports as you want. I generally run a report with each capital gain method to see which creates the least amount of gain. Once a report has been created click on Load Report and review the data for missing information.
Click on the Show Warnings button. If there was a sale with no purchase you will see a $0 cost basis. This means there must be a missing trade from when the crypto you sold was first bought. You will have to find the missing trade and probably manually enter it. Here’s what part of a report looks like.
We call this process of entering trades and looking for errors, crypto reconciliation. It can be very time consuming to find missing trades. If a missing trade needs to be manually entered, here’s how.
Manually Entering Trades
When manually entering trades the transaction type is Trade. When you click on the transaction type dropdown menu you’ll notice there are lots of different types from which to choose. When buying or selling crypto you’ll always choose Trade. If you earned interest in a BlockFi or other crypto account you’ll enter the transaction as Interest Income. Most of the other choices are for more advanced situations that aren’t covered in this getting started series of courses.
Tips and Tricks
Tip 1 – Whether you choose to use the API integrations or the CSV files to import trades from exchanges into your Cointracking.info portfolio, it can be a bit challenging. The reason is the process is not uniform between crypto exchanges and sometimes the data from APIs is not compatible with data from CSV files. Whichever way you choose to import your trades, I highly recommend doing it the same way every time.
Tip 2 – If you made trades inside some of the more popular wallets, like Exodus, Cointracking.info allows those trades to be imported using their CSV import feature. Simply locate the wallet import dropdown and follow the instructions.
Tip 3 – When creating a new tax report the settings section can be a little overwhelming until you learn the options. In the next three image I’ve shared how I use the settings. This is a great place to start until you get familiar with them. Once you’re comfortable with what each setting means, then you can change them and see how that affects your report. With a paid subscription, you can run as many tax reports as you need. With that in mind, I recommend running multiple reports for one year and select a different capital gains method (FIFO, LIFO, etc) for each. Then choose the report with the capital gains method that gives you the least amount of gains.
Create a New Tax Report
Capital Gains Methods
Here is a picture I took with my iPhone of the dropdown menu for the capital gains method from the previous image. It was the only way I could capture the menu. Here’s another little tip. I recommend testing the gains for methods FIFO, LIFO, HIFO, and HPFO. Also, always try the OPTI capital gain method to see if it will reduce your gains even more than others.
At the bottom of the tax report settings, you’ll see Advance Settings. Click on show advanced settings and follow the selections I’ve given you in this image. There are lots of options, but the only one you should need to change is the 3rd currency fees. Be sure this is turned on.
I hope you enjoyed the content shared in this chapter. If you got something positive from the information, please share your feedback and add a comment. Your input will help us create even better courses in the future.