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Tax prep is rarely fun, but it can be an especially big nightmare for active traders. When it comes to your taxes, you could be facing a daunting pile of paperwork and a hefty tax bill. The IRS will be paying close attention to your trading activity, and if you don’t report it correctly, they’ll take a big bite out of your profits. The taxation rules for day traders are constantly changing, too. Failing to stay up-to-date on those taxation changes will cost you.

• Day Trading Tax Preparation Software
• Day Trading Tax Software

If your capital-gains tax is smaller, that's what the software will tell you to pay. But as a trader who elects mark to market, you should not be paying any capital-gains tax, regardless of the. Trading journal, trade management and performance tracking software. Forget your xls trading spreadsheet and get serious about your trading business. Stock, futures and options. Accounting for trading gains and losses is the responsibility of securities traders; they must report each securities trade and related wash-sale loss adjustments on IRS Form 8949 in compliance with Section 1091, which then feeds into Schedule D (capital gains and losses).

You can make tax time a lot easier on yourself (and a lot easier on your bank account) with tax software made for day traders. Good software will help you automate your trading activity while looking for ways to reduce your tax obligation. It will also update automatically with new tax regulations to take the guesswork out of reporting. Here are ten tax services to consider when you get ready to file.

TurboTax is the most popular tax software program currently available, and after more than 25 years, the “Granddaddy of Them All” has withstood the test of time. Click here to read our TurboTax Review. As a day trader, you probably have a million and one things on your plate every day. Why add one more thing to the mix and worry about taking care of your taxes, too? At Trader’s Accounting, we specialize in offering a variety of tax preparation services specifically designed for active traders.

1. H&R Block

If you want to stick with a tried-and-true company for your tax preparations, H&R Block is a good choice. It is our #1 pick for active traders and investors because when you have a large number of buy and sell orders, it’s sometimes best to have an accountant check your tax returns; even if you are confident in doing your own taxes. H&R Block offers the option to have an accountant prepare your taxes for a very cheap rate and they are quite familiar with all kinds of active trading platforms: TD Ameritrade, Coinbase, Etrade, you name it. Started in 1955, it’s become one of the biggest names in tax preparation. While they don’t offer tax software for active traders specifically, their software will do what you need it to do. It will generate a Schedule D, calculate your capital gains taxes, and prepare your paperwork to file your taxes. H&R Block has a free option if you want to take the time to prepare your taxes on your own. Their UI is the friendliest and most intuitive UIs we have found of all tax preparation softwares. It’s hard to believe they give it away for free, but they do. They provide you with easy options for you to import your portfolio and trades from your broker.

When I see that I have already a couple dozen transactions to track for long term or short term capital gains, I just like using their tax preparation option that includes having an accountant check my returns. It provides for an extra layer of security if you were to be audited by the IRS, and it doesn’t cost much at all as it starts at $69.

• In-person help in one of their branches is available when you need it
• Audit support will help you prep and organize your tax information in case of an audit
• Millions of individuals and businesses use this long-established company every year for tax prep

• You’ll need to track your trades elsewhere and import the information to prep your tax return
• If you need help, you could end up waiting in line at one of their locations

2. TurboTax

TurboTax is Intuit’s full-featured tax software, and it has good options for active traders, too. This online tax service makes it simple to file. Start by answering questions about your life, income, and trading activity. TurboTax will then walk you through everything you need to fill out to complete your tax return. Intuit also owns Quicken and QuickBooks, so syncing them with TurboTax will make the filing process even faster. The tools included in their more expensive packages will help you manage even the most complicated tax returns.

• Makes it easy to report your investment income
• Calculates your capital gains taxes for you
• Capable of handling thousands of transactions so it’s great for busy traders

• You’ll need to purchase the premier plan to get all the features you need to report investment income
• State tax reporting is more expensive than with some other programs

3. GainsKeeper

GainsKeeper is tax software made for active traders. There is a lot of automated record-keeping built into the product, which streamlines your reporting. Even things like calculating your capital gains taxes are largely automated. The software offers portfolio tracking along with Schedule D and tax preparation. Traders will also appreciate the optimization tools, which useful for helping you find ways to cut down on your tax obligation. It’s solid software for day traders, though could end up being a more expensive option for some.

• Good selection of customized reports, including mark-to-market reports
• Can work with other tax reporting software programs

• While only $69 for a license, the total cost of ownership can end up significantly higher than other software packages

4. TradeLog

TradeLog is tax software specifically designed and built for active traders. It understands what is needed when it comes to accurately reporting and filing taxes on investment income. It’s more than just a comprehensive cloud-based tax service, though. TradeLog also features tools for managing your trade history, analyzing your trading performance, and alerts on your trade activity. It’s easy enough to get started, and webinars are available if you want in-depth guidance on using all the features included in the software.

• Comprehensive reporting for traders including wash-sale reporting and mark-to-market accounting
• Helps you identify possible tax benefits you might not know you are eligible to receive
• Automatically downloads trading data from brokerage firms for easy data entry

• TradeLog bases its annual subscription rates on the number of trades per year, so some may find it pricey

5. Credit Karma

Credit Karma established itself a few years ago as an easy way to keep an eye on your credit score. They expanded their suite of free financial tools with the addition of free tax preparation. For traders, it’s the cheapest option out there, because it’s completely free, even for state returns. Beware that the service may not work for all tax situations, though. Active traders can file their Schedule D, so Credit Karma should work for most. If you have a more complicated tax situation, you may need to pay for a more comprehensive service.

Day Trading Tax Preparation Software

• You can file for free, state and federal, making it the cheapest option on the list
• Despite the free price tag, they also include free audit defense
• Guaranteed maximum refund

6. TaxAct

Active Traders will need to opt for TaxAct’s Premier Edition. This edition allows you to report your stocks, gains and losses, and other investments. It also includes prioritized support. If you aren’t sure about a question on your taxes, you can call one of their CPA or IRS-enrolled agents for help, and you’ll jump to the front of the line. The system will keep up to seven years worth of returns in their secure online server, keeping all your tax returns in one convenient spot.

• Prioritized support offers screen sharing so a CPA or IRS-enrolled agent can assist you
• Guaranteed to give you the maximum refund possible
• Stock Assistant makes it easy to import your investment data

• You’ll pay $79,95 just for your federal return with additional cost to file any state returns you might need

7. eSmart Tax

eSmart Tax offers a deluxe edition made for investors. As day trader tax software, it’s pretty robust, especially for the price. The software will easily handle your investment income reporting as well as itemized deductions. It’s part of the Liberty Tax family, so if you run into any issues you can visit one of their 2,500 storefronts across the United States and get answers from a tax professional.

• Accuracy guarantee will pay any penalties and interest if the software miscalculates your taxes
• You can get a printed and bound copy of your return through the software, something normally only offered by CPAs

• While the software is fairly straightforward, experience filing is useful to make sure you don’t miss anything

8. Deskera

Deskera offers tax prep software that promises to make calculations and filing easy. They offer a 30-day free trial, then plans start at $9 per user per month. Active traders will want to opt for their more expensive Essential plan, though. It allows for unlimited transactions and multiple currencies. Since Deskera is a global company based in Singapore, there are a lot of options here for day traders working in multiple countries.

• Tax rules for tax jurisdictions around the world
• A full suite of services gives you more than just tax prep software
• Good exchange rate management system for those trading in multiple currencies

• Could require a lot of tweaking within the software to make it right for an active trader
• Busy traders may appreciate a solution that’s ready out-of-the-box

9. Liberty Tax

One of the nice things about Liberty Tax is that you can either opt to use their online service or have one of their professionals do it for you. If you opt for the online option, then you’ll have to pay for the Premium Edition of the tax service to get the forms and schedules needed to report your income. Liberty offers a 100% guarantee and promises to get you the maximum refund, even on complicated investment returns.

• Lots of online resources to answer tax questions as well as in-person help available in their branches

• Software can be complicated, so best left to the trader who is comfortable filing on their own
• Traders will need the Premium edition, which is more expensive than some other options

10. TaxSlayer

TaxSlayer is one of the newer names on this list, but one that’s quickly becoming popular do to their well-designed software and competitive pricing. If you are comfortable doing your taxes yourself, this can be one of the least expensive options available. The affordable Classic package will only set you back $17, but you won’t get any TaxSlayer customer support. If you would rather have access to one of their tax professionals, it’s still a reasonable $37.

• One of the least expensive options for filing your taxes as an active trader
• Classic package has no restrictions on forms, so it’s suitable for all tax situations

• One of the lesser-known companies on this list, but definitely making a name for themselves when it comes to tax prep

Tax Software for Crypto Investors

Made a killing this year on your coinbase or robinhood account, and are now worried about what all of this means for your taxes? Below, you’ll find information on the four best tax services for crypto investors: TaxBit, TokenTax, BearTax, and ZenLedger. Each has its own unique benefits that help crypto investors do their taxes easily and efficiently. It’s just as important for crypto investors to calculate their taxes as it is for everybody else, but it can be a time-consuming and confusing process depending on your level of activity. To help you get started, these four softwares will assist you in resolving any confusion, as well as ensure that you report your earning to the IRS properly.

TaxBit

TaxBit is one of the best tax softwares for crypto investors because it was created by people who know the process best: lawyers, software developers, and accountants. By providing a detailed report of how TaxBit calculated the taxes, this software program allows for auditors and accountants to easily trace and confirm the calculations.

TokenTax

TokenTax was designed to be an easy-to-use and efficient tool for crypto investors to file their taxes. In fact, Forbes deemed TokenTax as the no. 1 tax-filing software program for crypto investors. One of its best features is that it allows users to upload important data easily. It also automatically provides you with all of the tax forms that you need.

BearTax

Using BearTax to file crypto currency taxes is an easy solution to an otherwise complicated process. With its appealing interface, users can seamlessly navigate through the platform to use BearTax’s best features, including the ability for you to look over the liabilities of each of your assets. Additionally, BearTax is affordable, and it allows you to pick through several pricing options depending on your needs.

ZenLedger

Even though it is one of the most simple software programs for filing crypto taxes, ZenLedger still competes with the programs mentioned above. If you purchase this program, you will be able to import your transaction data and history, as well as receive important tax documents that report capital gains, donations, and more. With the help of ZenLedger, crypto investors will pay exactly what they owe.

Tax Software for Stock Investors

The best type of tax software program for a stock investor is dependent on how heavy their activity is. The four tax platforms below—H&R Block Premium, TurboTax Premium, TaxHawk, and Credit Karma Tax—are all great choices for stock investors who want to cut through the confusion and time consumption of filing taxes. However, we recommend TaxHawk and Credit Karma Tax for stock investors who have less activity (a couple of trades a year). For heavier stock investors, H&R Block Premium and TurboTax Premium are the best solutions.

H&R Block Premium

Although it’s one of the most expensive options, H&R Block Premium is one of the easiest and most efficient was for a stock investor to file taxes. The capabilities of the program, which will help you save a ton of time, include the ability to upload a maximum of 500 trade transactions for each brokerage. This program can also determine your taxable income and your taxes on capital gains.

TurboTax Premium

Similar to H&R Block Premium, if you are a stock investor, TurboTax Premium should be at the top of your list of tax software programs. Additionally, if you are a customer of a robo-advisor, TurboTax Premium is a great option for you, as you can integrate this program with many different brokerages and robo-advisors, including Betterment. TurboTax is a tad expensive, but it can save you a lot of time.

Day Trading Tax Software

TaxHawk

If you don’t invest in the stock market heavily, TaxHawk is a better option for you, compared to the options above. At a lower price, TaxHawk has less capabilities, but it will still help you file your taxes correctly. Some of its best features include user-friendly navigation, the ability to upload data quickly, and good pricing options.

Credit Karma Tax

Another less expensive option, Credit Karma Tax provides a solution to all stock investors who want to file their taxes stress free. Virtually, once you input all of you data, Credit Karma Tax will do all of the work for you. Credit Karma Tax is best for stock investors who do not have a complicated filing because its capabilities are not as great as other platforms. Still, it is a good resource to use if you are familiar with taxes and need a quick solution.

Which Tax Service for Day Traders Will You Use This Year?

Not sure which software is right for you? Most of the tax software on this list allows you to do your taxes before you pay for the service or officially file. Take advantage of that and use a few to see which one actually comes up with the biggest refund (or smallest payment due). The only thing you’ll lose out on is a bit of your time, and you may end up finding a tax service you love. Look for one that largely automates the process of reporting and filing your taxes so you can focus on trading instead of a big tax bill.

Intelligent Tools and Turnkey Solutions For Active Traders

Who controls your trader taxes? You're a trader, not just an average investor. You make intelligent trading decisions for success. Why would you let your trader taxes be controlled by your broker-provided 1099-b?

TradeLog empowers you with the tools needed to do more than create tax reports. Take control of your wash sales, take advantage of special tax rules, or even switch to trader tax status. TradeLog's reporting has been trusted by thousands of traders and tax pros for over 20 years.

Wish someone else would just do it for you? We provide turnkey service solutions with Trader Tax Solutions by TradeLog, letting you focus your time on trading while we take care of the tax part.

Form 8949

• Import actual trade history from almost any broker.
• Apply special tax rules for Section 1256 contracts and more.
• Generate IRS-ready Form 8949 Schedule D reporting.
• eFile with your preferred solution like TurboTax® or TaxAct®.

Control Wash Sales

• Account for wash sales the IRS requires, but that your broker can't report.
• Manage wash sales before year-end with TradeLog's Potential Wash Sales Report.
• Transparent reporting reveals how wash sales impact your bottom-line.

Trader Tax Status

• Automate year end mark to market adjustments.
• IRS Form 4797 reporting for section 475(f) traders.
• Section 481 reporting for mark to market election.
• Special tax handling for volatility ETNs and more.