Why are US Millennials Inclined Toward Crypto? Why Do They Need the Best Free Crypto Tax Software
Cryptocurrency, as an investment, has grown exponentially in the last few years. Initially launched as a medium of exchange, it has now become an investment vehicle, and not only this, traders earn good money from crypto daily trading.
These facts are now backed by Alto, an investment firm. According to their research, 40 percent of American millennials (26 to 41-year-old individuals) are invested in cryptocurrencies. This number is the same as the people who own individual stocks, as per the research. In this article, we will see why millennials are inclined toward cryptocurrency and how they can easily calculate their crypto taxes with the best free crypto tax software.
Why Millennials Like to Invest in Crypto
According to the same research, more US millennials have invested in cryptocurrencies than mutual funds. Also, 70 percent of crypto HODLers have included cryptocurrencies in their Individual Retirement Accounts (IRAs). Also, Americans in the same age group who have not invested in cryptocurrencies are considering entering this ecosystem.
However, the current economic conditions have made it tough for US millennials to invest in general. According to Alto CEO, Eric Satz, “Soaring living costs, consumption in great amounts, and ever-increasing student loan debt has made it difficult for millennials to afford the present.”
Even though millennials are embracing crypto investments, almost 77 percent said that they are interested in real estate investment opportunities and they would allocate funds for the same. Meanwhile, 67 percent and 57 percent of US millennials are considering Innovation funds and Angel investing, respectively.
Millennials Ready to Get Their Salaries in Crypto
According to another recent research, 51 percent of Gen Z (individuals born between 1997-2012) and 36 percent of millennials would prefer half of their salaries in cryptocurrencies as an alternative to fair currency.
CEO of deVere Group, Nigel Green believes that the majority of youngsters are attracted to this asset class because they have witnessed technological developments since they were kids. And hence, they understand the enormous potential of cryptocurrencies.
Whether it is investing, trading, or an IRA, individuals involved in cryptocurrencies have to pay taxes on profits they booked by selling their investments. While investors don’t have to pay taxes on crypto retirement plans, they do have to report taxes once they withdraw those funds after their retirements. So, let us tell you about the best free crypto tax software.
The Best Free Crypto Tax Software
Crypto taxes are inevitable. The IRS is taking active measures in setting up regulations to collect taxes on crypto investments according to the IRS Notice 2014-21.
With that being said, crypto taxes are not easy to calculate. If you trade with crypto every day, you can accumulate hundreds if not thousands of transactions by the end of the year. If you wish to calculate your taxes manually, you have to keep track of all your cost bases, capital gains and losses, fair market value, and more. On top of that, if you are using more than one crypto exchange, calculating your taxes can become extremely daunting.
Let us suggest ZenLedger, the best free crypto tax software. What makes it the best? Even though its paid plans have more features, its free version might out-feature most of the other paid crypto tax software. It supports more than 500 crypto exchanges so that you can import transactions from multiple exchanges onto the ZenLedger platform. While you only get 25 transactions in the free plan, you might get a glimpse of how easy it is to calculate taxes on the ZenLedger platform. In the free plan, you get premium customer support, which most crypto tax software doesn’t offer. Other than that, you get a detailed report of all your transactions.
The fact that millennials understand and adopt cryptocurrencies as a part of their investment portfolio makes it evident that cryptocurrencies can get widely adopted shortly. Also, with the best free crypto tax software such as ZenLedger, they can easily understand and calculate taxes.
1. How do I keep track of crypto taxes?
You can calculate your taxes manually, but you have to keep track of all your cost bases, capital gains and losses, fair market value, and more. On top of that, if you are using more than one crypto exchange, calculating your taxes can become extremely daunting. It’s easier if you use crypto tax software.
2. What happens if you don’t report cryptocurrency on taxes?
If you don’t report your taxes on cryptocurrency deliberately, you could get audited by the Internal Revenue Services (IRS). Once audited, you might have to pay hefty penalties. To avoid it, report your crypto income as accurately as possible and on time.
3. What is crypto tax software?
It is a computer program that helps its users handle tax-related activities in the crypto market. Some crypto tax software also includes complete crypto portfolio tracking capabilities, which allows the users to see all their crypto holdings across exchanges.