Your Reconcile app just got upgraded!

We've enhanced your initial app with a better interface and user experience.

Hey everyone, hope everyone’s had a great August so far! Checking in with all of you since we last shared updates to the Reconcile squad. I’ll share a quick summary below and also outline what to look forward to!!


Quick Summary

We’re getting closer and closer to our big mission: to save the average Reconcile user $5,000 every year in taxes. Want to learn more? Read up on our mission here.

Since we launched in early July, we’ve onboarded dozens of investors and heard lots of fantastic feedback, which shaped the recent enhancements we’ve made.

#1

Feedback: Give me a detailed view of my transactions.

What we did: We’re now providing more information on the type and description of your transaction. This way, you can quickly scroll through all of your stocks, options, short-term gains, wash sales, etc.

What’s to come: We’ll be breaking down each transaction so that you can see which specific tax lot was bought and sold, providing greater transparency into how we calculate your tax estimate using the FIFO accounting method.

#2

Feedback: Show me my current holdings and tax lots and the estimated tax I’ll owe if I sell anything.

What we did: We dedicated a section to your tax lots so that you can see specific buy information - when you bought it, how much did you pay, etc. Also, you’ll see how many days away you are from that tax lot turning into a long-term holding, at which point you’ll pay less tax on your gains.

What’s to come: We’ll break up your holdings into different categories (e.g. stocks, options, crypto, etc.) and give you a real-time, estimated tax liability for each lot. That way, you can easily decide if the tax consequences are worth you selling.

#3

Feedback: Break out my tax estimate so that I can see how it’s calculated.

What we did: We made it even easier now for you to see your estimated short and long-term taxes based on your trading activity. You can see all of your ST and LT gains and the tax brackets that went into your estimate calculation. We’ve even aggregated all of your wash sales into one view so that you can pay better attention to them!

What’s to come: We’ll be providing insights alongside your taxes so that you can get a better idea of what holdings to sell in order to lower your tax liability before the end of 2021!


What else should you look forward to?

We’ve expanded our engineering and marketing team to build and scale faster! Here’s what we’ll be working on in the next few weeks and the benefit to you:

  1. A faster onboarding experience designed to get you a more accurate 2021 tax estimate and to give you actionable insights that can lower your tax liability.

  2. A smart, alerts engine that gives you real-time insights on avoiding wash sales, lowering your tax rates, and selling specific shares to tax-loss harvest.

  3. An easier flow to adding in missing information so that your transactions are up to date, improving your tax liability estimate.

  4. An expanded set of brokerage integrations so that you can connect multiple accounts instead of just Robinhood and get a more comprehensive tax liability estimate.

Want us to work on something else for you? Shoot me an email at jaimindesai@reconcilemoney.com

How can I sign up for Cshflow?

Not signed up yet? You can sign up easily on our website using this linkWe’ve discounted our service to just $10/month for all of our newsletter readers :)


Thanks for reading!

Jaimin Desai - CEO & Co-Founder of Reconcile

www.getreconcile.com

Why build Cshflow?

Lets empower millions to go toe-to-toe with Warren Buffett

Our mission is to help retail traders advance from being gamblers at a casino to sophisticated traders that can go toe-to-toe with the Buffetts. If we succeed, we'll be empowering traders to get one giant step closer to their dreams of financial freedom.


Over the last year, there's been an enormous influx of retail investors entering the stock market arena, looking to capitalize on the latest bull run. Thanks to apps like Robinhood, millions of new investors were able to create an account and start trading complex, high-risk, high-reward options within minutes. The stories on WallStreetBets certainly illustrated the potential for life-changing earnings, which further instilled this lottery culture that has permeated investing these days. There's a reason why NFTs, DeFi farming, and Pokemon cards have found ample investors. There's a zeitgeist behind the scenes from social economics that millennials and younger likely won't be able to retire unless they 10-100x their money, leading to these all or nothing risky bets.

What's missing from the tales of big wins is the tax burden that comes with it. Most new traders don't think about taxes until they file them (if they file them), but that's a terrible mistake. For starters, not knowing your tax obligation until the following year means you can have a back-breaking tax bill without any time to budget for it. That is what happened to a Robinhood trader, who made only $45,000 in profits but still owed $800,000. How did that happen? He was clueless about an IRS rule called wash sales, which disallows certain losses from being deducted from gains. Imagine using Turbotax or sitting alongside your accountant expecting to have a marginal tax bill, and instead, you find out that you owe $800,000!

Secondly, active tax management throughout the year means that you can make wise investment decisions while minimizing your obligation to the IRS. Here's an example, suppose you owe $5,000 in taxes and notice that you're down $5,000 in your crypto account. You can sell all of it to lock in a $5,000 loss and rebuy it immediately with no penalty since there's no wash sale rule in crypto (yet). So in theory, your total investment account values are identical before and after the transaction yet you now owe $0 instead of $5,000.

Thirdly, there's a substantial difference in tax rates between short-term and long-term capital gains. There's a reason why the 1% get approximately 26% of their yearly income from long-term capital gains - it's way cheaper! Instead of getting taxed at about 38% (for the highest bracket), they'll only pay 23%. While sometimes it makes sense to have short-term trades like if you made a decent profit flipping Dogecoin, investors should aim to hold onto their stocks for at least a year. After your positions are now considered long-term holdings, you can think about selling them in years, in which you have little to no W-2 income to optimize your taxes again since your first $40,000 in long-term gains is tax-free!

Our mission is to help retail traders advance from being gamblers at a casino to sophisticated traders that can go toe-to-toe with the Buffetts. By enabling them with a real-time tax tool, they can make smarter investment decisions and optimize their gains. Over time those tax savings, if reinvested into the market, can compound into a sizable windfall. If we succeed, we'll be empowering traders to get one giant step closer to their dreams of financial freedom.

Cshflow: Your Capital Gains Tax Calculator

A new product released by Reconcile

Almost half of US retail investors were completely new to the markets in the past year. They are young, mostly under 34. And they are aggressive: much more willing than those more experienced in stock markets to borrow to fund their bets, to make heavy use of options to fire up wagers on stocks, and to use social media as a research tool to find trading ideas. - Deutsche Bank 🤑

Overview

Since the start of the pandemic, brokerages saw an influx of retail traders looking to supplement their incomes while working from home or to take advantage of downtime after being laid off. Instead of a market collapse last year, US indices notched one of its best years of all time, and the start of 2021 was no different. The 'meme-stock' frenzy to start the year turned many retail traders into millionaires in just a matter of days. With all this money being made, retail traders often overlooked the tax implications of their trades and found an unwelcome surprise from the taxman this April. Stories of traders owing excess of $20,000 in capital gains taxes alone kept popping up on social media. Unfortunately, brokerages don't do enough to educate their users about their tax implications.

We took it upon ourselves to step in and help traders with an automated app that directly connects to brokerages and estimates 2021 taxes in real-time. In addition to being a robust tax calculator, we flag trades that trip complex tax rules like wash sales. In the months to come, we’ll build in additional functionality to simulate tax implications of trades and to auto-pay taxes to the IRS directly.

Why can't I just wait to calculate my taxes until next year's deadline?

There are two important reasons why you should have a real-time perspective on your capital gains tax liability.

  1. If you made a substantial gain on a hot stock tip in a quarter, you may be required to make a good faith tax payment to the IRS by the quarterly deadline. There's no specific definition for 'substantial gain' so it's important to talk to a professional tax advisor about this. If you don't make your required payments, the IRS can hit you with an underpayment penalty, which is approximately 4% of the total amount that you owe. To calculate your good faith payment, you can follow the safeharbor rule, which allows you to pay up to last year's tax liability across four payments. For example, if your 2020 tax liability was $4,000, you can make four $1,000 payments every quarter, no matter how big your capital gains are.

  2. If your buddy's stock tips are paying off well for you, it's good to budget your estimated liability so that you don't get sticker shock when filing your taxes! Imagine expecting a refund and then ending up with a $15,000 tax bill instead. Having a real-time snapshot of your estimated taxes can help you strategize your future trading decisions to best minimize the amount you owe.

How will Cshflow help me moving forward?

Our mission with Cshflow is to simplify your capital gains tax preparation and filing. We know how complicated and confusing taxes can be, especially when it comes to the nuances of capital gains. Here's what we plan to help you with moving forward:

  • Estimating your 2021 federal ST & LT capital gains tax for stocks & options

  • Detecting & warning you of wash sales

  • Notifying you of your account activity and upcoming payment deadlines

  • Simulating mock trades so that you can strategize tax implications before you trade

  • Incorporating additional investment sources into your estimated tax calculator (crypto, NFTs, collectibles, etc.)

  • Calculating your safeharbor payments

  • Estimating your 2021 state capital gains tax

  • Auto-paying the IRS for you

  • Placing your expected tax payments in high-yield accounts so you can earn a bit more

  • And more ... 😀

How can I sign up for Cshflow?

You can sign up easily on our website using this link! We’ll give all of you early believers a special discount moving forward as well.


Thanks for reading!

Jaimin Desai - CEO & Co-Founder of Reconcile

www.getreconcile.com

Track your tax refunds with Reconcile

and a bunch of other updates to share!

Hey everyone, happy hump day! Feels great to be in the last few days of gloomy winter and so close to sunny spring. I have a saying, “humans are like sunflowers” which is why I’m even more excited for all of us to start going outside and to enjoy a bit of normalcy once again.

Since we last checked in earlier last month, we’ve accomplished some big milestones, learned a ton from you all, and built additional features to make your lives a bit easier.

Milestones

Onboarded 81 of you onto our private Reconcile beta in the last month. So far, we’ve heard mainly great feedback!

Learnings

Some of you had issues with Reconcile alerting you about your refunds or with linking your bank accounts. We’ve introduced fixes to these problems in our latest version (v1.0.4), so we’ll be better prepared to address these issues as they come up now.

We kept hearing how much more automated you want Reconcile, so we’re refocusing our efforts on this exactly. Our initial step to solving this is to keep learning about the automation you NEED desperately. You’ll see an ability to ‘create your own custom tracker’ within the app, which will allow you to directly push your personalized automation to our engineering team.

New Features

Since we’re in the middle of tax season, we thought it would be awesome if Reconcile could automatically track our refunds and let us know the minute they come into our account! Just make sure you’ve linked your checking account with Reconcile, and we’ll send you an alert as soon as we see your IRS and state refunds come in.

Also, we created an easy way for you to personalize the trackers that you want in your life! All you have to do is create a custom tracker using the chatbot and our engineering team will work to build this automation for you right away! You can see the status of your custom tracker as well as all available trackers in our library, located in the settings.

Looking Ahead

We’re laser-focused on solving your core problems around managing your money. We understand that unless you can afford a full-time financial manager, you have to self-manage your finances, which means staying on top of all your accounts constantly. This is a lifestyle that we need to move away from and instead rely on automated technology to do the work for us!


Thanks for being our early adopters!

Jaimin Desai - CEO & Co-Founder of Reconcile

www.getreconcile.com

Reconcile is ready for you

The wait is finally over - get ready to use Reconcile on your iPhone

Hey everyone, happy Monday! Hope everyone’s been well and safe, especially those of us facing this monster snowpocalypse in the Northeast right now.

It’s been a while since our last update, so I’ll start with that. We’ve been on quite the ride since November, and we’re excited about this next stage!

  • Narrowed our use case to tracking your refunds and resolving any disputes when they don’t come in on time or in the amount expected.

  • Raised our first angel checks to fund us for the better part of 2021

  • Expanded our team from three to eleven across engineering, design, and marketing

  • Built, tested, and deployed our new app (keep reading to see more)

Moving forward, we’re going to use this newsletter for new features, core updates, and any direct announcements to you! So the fintech and voice tech news section of these newsletters will move onto our blog in the coming weeks.

Lastly, I’ve created a direct phone number to communicate with you all - text me at (908) 975-1680. I figured this is the best method to send me direct feedback on the app as well as any questions you have about Reconcile or financial management.


So … what’s up with the new Reconcile?

  1. When can I start using the app?

    We’ve split up our waitlist, all 350 of you, into two camps so that we can personally onboard as many of you in the next few weeks. Camp one will start receiving access as early as tomorrow morning. Camp two should open up in mid-February. I’ll be sending an email to each of you so you know what camp you’re in.

  2. What to expect?

    You should receive two emails - one from Testflight (Apple’s beta app store) and one from me. The Testflight email should look something like this.

    If you don’t see it, make sure it didn’t end up in your spam. I’ll send an email from jaimindesai@reconcilemoney.com headlined “Let’s get you started using Reconcile” by tomorrow as well. I’ll reiterate what’s here and help guide you through using the app step-by-step.

  3. How will the app work?

    I’ve recorded some clips on my phone to show you how the app will work. Keep in mind, this is our first external release so any and all feedback is much appreciated!

    Logging In

    Tracking a Refund

    Linking an Account

    Adding Reconcile to Siri

On behalf of the team at Reconcile, we’re very thankful for all of your support thus far. We’ve certainly endured a long journey to build and release this latest version of Reconcile. We’re most excited about bringing to market one of the first financial voice applications and the only solution to tracking your refunds conveniently.

Now let’s keep building and solving more of your pains together!!!


Thanks for reading!

Jaimin Desai - CEO & Co-Founder of Reconcile

www.getreconcile.com

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