Host Tom Shaughnessy talks to Pat Larsen, CEO, and co-founder of ZenLedger. They discuss the issues with filing taxes when you have cryptocurrencies, what gaps ZenLedger fills, possible future use cases, and more.
Episode Highlights:
- Pat went to the US Marine Academy and became a Navy officer, completing two combat tours.
- He proceeded to work in investment banking and tech, including for Amazon and several startups, before founding ZenLedger.
- Between his time in the Navy and his education, Pat is experienced both in math and science and in risk-taking and decision making.
- ZenLedger is a browser-based cryptocurrency tax software.
- The software handles the crypto portion of your taxes and allows you to export the data to use in their main tax filing.
- Because Congress hasn’t passed many laws regulating or providing guidance on taxation of crypto, so ZenLedger has to lean on the IRS for that information on complex things like mining, staking, airdrops, etc.
- One of ZenLedger’s founding offerings was their customer service and automation.
- TurboTax is a partner with ZenLedger.
- They generate new customers in various ways from talking about tax-loss harvesting to organic outreach on podcasts to building partnerships.
- It only takes about 10 minutes to use the software as a new user; the biggest step is connecting to your exchanges.
- ZenLedger demonstrates that you’re covering your bases and making good-faith efforts to file your taxes correctly.
- The automatically generated 1099-K forms from exchanges only show your aggregate trading, not your net capital gains and losses.
- Pat and Tom think a possible future use case could be using ZenLedger to file your basic income tax if it ends up being earned entirely through cryptocurrency.
- Pat’s Navy background taught him to make contingency plans for everything.
- Right now in the midst of all the macroeconomic changes happening due to COVID-19, Bitcoin has been largely unaffected.
Key Points:
- Most CPAs have no idea how to handle cryptocurrency in tax filings.
- Using ZenLedger saves you hours of aggregating information manually.
Tweetable Quotes
- “The IRS obviously cares. They’ve sent out tens of thousands of warning letters. They’re using blockchain analytic software. So I think the enforcement actions are stepping up, there will be audits, so you just want to take care of yourself.” –Pat Larsen
- “At its core, we’re saving you time, we’re giving you accurate reports, and we’re giving you peace of mind whether you’re in a corporate capacity or an individual capacity.” –Pat Larsen
- “You’re going big wave surfing & you just have to pick a place that has good waves & you need to trust that you’ve trained with your skills to be able to ride those waves, & if you fall down as you inevitably will, that you’re gonna get back up & ride another wave.” –Pat Larsen
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