Tax Loss Harvesting Tool

A sophisticated web application designed to help cryptocurrency investors optimize their tax strategy by identifying opportunities for tax loss harvesting.

Getting Started

First, install the dependencies:

npm install
# or
yarn install
# or
pnpm install
# or
bun install

Then, run the development server:

npm run dev
# or
yarn dev
# or
pnpm dev
# or
bun dev

Open http://localhost:3000 with your browser to see the application.

Overview

This Tax Loss Harvesting Tool helps crypto investors minimize their tax liability by strategically selling assets at a loss to offset capital gains. The application visualizes your current capital gains situation and allows you to select specific holdings to harvest for tax benefits.

Features

• Real-time Capital Gains Tracking: View your short-term and long-term capital gains/losses
• Interactive Holdings Table: Sort and select cryptocurrency holdings for tax loss harvesting
• Tax Savings Calculator: Instantly see potential tax savings based on selected assets
• Responsive Design: Works seamlessly on desktop and mobile devices

Project Structure

src/
├── app/               # Next.js app directory
├── components/        # UI components
├── context/           # TaxHarvestingContext for state management
├── lib/               # Utility functions and calculations
├── services/          # API service functions
└── types/             # TypeScript type definitions

Key Components

• Dashboard: Main container for the application UI
• CapitalGainsCard: Displays capital gains information
• HoldingsTable: Interactive table for selecting assets to harvest
• TaxHarvestingContext: Manages application state and calculations

Assumptions

This application makes the following assumptions:

1. Tax Rate: Uses standard tax rates for short-term and long-term capital gains calculations (actual rates may vary by jurisdiction and income level)
2. Asset Cost Basis: Calculates using the first-in, first-out (FIFO) method
3. Holding Period: Assumes assets held more than 1 year qualify for long-term capital gains treatment
4. Wash Sale Rules: While traditional securities have wash sale restrictions, this tool assumes cryptocurrency transactions are not subject to wash sale rules (as per current regulations in many jurisdictions)
5. Data Freshness: Price data should be updated regularly for accurate calculations

Technologies Used

• Next.js - React framework
• TypeScript - Typed JavaScript
• Tailwind CSS - Utility-first CSS framework
• Shadcn UI - UI component library
• Lucide React - Icon library

Customization

You can customize the application by:

1. Modifying the tax rates in the calculations
2. Updating the UI theme in src/app/globals.css
3. Adding additional asset types to the data model