For our bonus Vendor Spotlight, we feature Digital asset accounting solutions provider TaxBit, which is focused on helping tame the digital economy into something accountants can work with more easily, especially with regards to blockchain, cryptocurrencies and digital assets. The software provides solutions for tax, accounting and compliance related to this novel practice area. Founded in 2018, TaxBit has grown since then, going from a solution for retail crypto customers to, today, also supporting institutional, enterprise and public sector customers across the digital asset ecosystem, a development that has also seen the formation of numerous partnerships with both tech companies and retail brands.
Aaron Jacob, head of accounting solutions at TaxBit, talked to Accounting Today about their recent accomplishments and what people can expect in the future.
How would you best describe what your company does?
Jacob: Designed by CPAs and tax attorneys, TaxBit is the leading tax and accounting compliance solution for the digital economy, supporting enterprises and the public sector. Providing solutions at scale, our platform modernizes the otherwise complex and manual — from automating crypto accounting to tax calculations and document issuance.
What is in your product line, and what is your flagship product?
Jacob: The TaxBit platform, a single API-powered platform, is our flagship product, enabling compliance through a single system of record that reduces complexity and increases transparency. We offer a premier end-to-end compliance and reporting solution for the digital economy with three product pillars: Accounting, Tax, and Public Sector, which include features for full-scale subledger accounting, data integrations with dozens of blockchains and centralized exchanges, chart of account mapping and ERP integrations, extensive reporting and support for tax filings, cost basis tracking, information reporting, digital W9/W8s, and more.
What product of yours do you think should be better known among accountants?
Jacob: In addition to our renowned tax information reporting solution, TaxBit proudly offers the industry’s premier accounting subledger and corporate tax solutions. Our technology stands as the only Big4 and SEC-grade subledger accounting solution specifically tailored to the unique nuances and intricacies of digital assets. We work with leading enterprises like Google, Fox, NYDIG, Ralph Lauren, and many others to address their financial reporting and corporate tax requirements.
Our accounting subledger solution serves as an invaluable tool for CFOs, controllers, treasurers, FP&A, auditors, and corporate tax professionals seeking to optimize and automate digital asset accounting operations – spanning everything from transaction aggregation, inventory queue management, gain/loss calculations, reporting, journal entry creation, and ERP integration.
What was the last big initiative or project your company completed?
Jacob: TaxBit has accomplished several noteworthy initiatives, particularly our recent Netsuite integration and our renewed focus on enhancing user controls.
Firstly, TaxBit stands out as the exclusive digital asset subledger equipped to manage and compute calculations on a scale of hundreds of millions of transactions. Our unwavering commitment to catering to enterprise use cases, coupled with being exclusively designed by and for CPAs and practitioners, sets us apart. We have invested substantial efforts in refining our solution to meet the intricate requirements of enterprises navigating the complexities of launching and expanding their web3 presence.
Secondly, our rules engine and reconciliation flow have been meticulously crafted to automate the period-end closing process, significantly expediting the end-of-month procedures for our accountant users. A recent milestone includes the successful implementation of an end-to-end 2-way API integration with NetSuite. This empowers users to effortlessly execute chart of account mapping and fully automate the journal entry creation and book process from start to finish. Furthermore, we have introduced enhanced controls, allowing users to independently manage their cost basis methodology, peg stablecoins, filter out irrelevant tokens, and more.
Lastly, our latest reports align directly with the Financial Accounting Standards Board’s (FASB) new disclosure requirements for digital assets. As companies adhering to US Generally Accepted Accounting Principles (GAAP) are now mandated to provide specific disclosures related to their crypto assets and activities, our reports play a pivotal role in streamlining and automating this disclosure process.
What is the most exciting new thing you’re working on?
Jacob: We’re thrilled to be working with and supporting new customers on an international scale. This has necessitated the expansion of our system capabilities to encompass foreign currency reporting and accommodate the intricacies of International Financial Reporting Standards (IFRS) accounting treatment. We’re excited to be launching these capabilities with select partners, marking a significant step in broadening our international presence and focus. This represents a tremendous opportunity to extend the reach of our best-in-class product, traditionally leveraged by our US customer base, to a global audience and client base.
What is the biggest challenge with selling to this market? Of being a company whose customers are primarily accountants?
Jacob: The primary challenge in selling to the accountant market is effectively conveying the powerful and unique value of TaxBit’s solution to professionals who are inherently detail-oriented. Accountants, with their meticulous approach and limited time, appreciate a clear demonstration of how our product, built by and for accountants, caters specifically to their nuanced needs. Emphasizing not only the origin but also how our solution actively shapes features to simplify accountants’ lives is crucial. The challenge lies in consistently proving that TaxBit’s offering isn’t just another option in a somewhat crowded landscape, but rather a tool that has truly separated itself from the pack based on deep expert-driven and practitioner insights. Our client view us as an indispensable tool for enhancing precision and productivity in crypto accounting operations. With dozens of CPAs and attorneys on staff, this is a challenge that we openly embrace and choose to see as an opportunity!
What differentiates your company from others similar to it? What makes you different? Unique, even?
Jacob: Grounded in expertise and driven by our passion for innovation, TaxBit’s products and services are designed by CPAs and tax attorneys. Our platform delivers self-service data analysis and robust examination support with full tax calculation engines covering the entire digital asset ecosystem.
In 2022 alone, we supported 11 million taxpayers in the US with over 60 million forms, enabling us to have a robust single system of record ready for a variety of assets and information reporting use cases, regardless of organizational size or complexity.
TaxBit at a glance:
Headquarters: Draper, Utah
Other offices: Salt Lake City, San Francisco, Seattle, New York, Washington D.C.
Number of integrations: Over 500 sources
Notable partners: IRS, Deloitte, KPMG
Awards: The company was selected in the Forbes FinTech Top 50 list and ranked top 10 on Deloitte’s Technology Fast 500 list.
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