Missing Classifications

Hi Support,

there are actually missing a few classifications in my view:

When I get back my my money from a lending platform like compound I have to split the deposit. One is income and the other one is what? If it is unclassified it is reported as taxfree income in the german tax report but that’s of cours actually not the case. It is the same thing when it comes to staking. You have on the one hand staking reward and whats the second thing? This has the additional problem that the unclassified deposit is prolonging the period where I have to hold my staked cryptocurrency as in Germany it is tax free after a year.
The same thing is also a problem with Liquidity Pooling when getting it back from the pool. Could you please add some classifications to get it done right?

Hi @Metamusk! Thank you for your feedback. We have a video here about staking and how we came up with our classifications: https://youtu.be/v4znJluRTZQ

For Lending, you have 2 classifications:
image image

For Staking, let me try to get back to you on the best way to go about it. Currently the law is quite blurry in regards to staking and there are no clear guidelines.

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Thanks a lot for your quick reply and for the helpful video!

I understand, that for example staking is very blurry regarding taxation. But I think it would be very helpful, that one could connect the withdrawal and the depositing somehow, so that it is clear that I owned this cryptocurrency all the time.

This would be especially helpful for the one year retention time in the German tax law.
I learned from a tax lawyer (which is actually in the video :D) that if this one year retention period is over, this period couldn’t get prolonged afterwards. But in the case of Accointing, when I get it back from staking, the taxable period is again one year (and could get prolonged to ten years by the tax authority).

For Lending, the same thing would be great as the taxable period is also a problem as mentioned above. Although in my case the problem with lending is only cosmetically, as the tax authority could get suspicious due to my “taxfree income” ;).

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Hi @Metamusk. Thank you for the feedback. I will send it to product to see if there’s anything we can do about that.

Hi @Rod , are there any news if and when such a feature become available? I’m not really in a hurry but it would be good to know if I can finish my tax report with accointing or if I have to do it manually.

Hey! No new yet. I know it’s in the pipeline, but there’s no specific ETA. Once I have more details, I will get back to you on this.

@WINHELLER do you think you can help out @Metamusk with this query please?

@Rod Can you already estimate if such a feature will be available in the next month? I need to know if I can do my tax report with accointing or if I have to look for alternatives. Or should I reach out to @WINHELLER directly? Thx!

Here is what we have for staking: How to Import Liquidity Pool Transactions to ACCOINTING.com - Accointing Blog - Cryptocurrency Portfolio Tracking & tax Software

Apologies for the delayed response. I asked @WINHELLER already for some help and examples on how to deal with this with the platform. Thanks for your patience.

Thx @Matt , so this is for Liquidity Pooling. Does it than show it correctly in the tax report for liquidity pooling?
I could also do this for staking of course, but what should I do than with the original transactions? Do I delete them? Otherwise there are too much funds in the wallets. Is that ok for the tax report @Rod ? The problem is of course the same for liquidity pooling.

Thx for clarifying!

Hey guys! I understand your frustration with the staked and staking classifications so just to clear this out from our standpoint:

all tokens that were staked=do not classify
all tokens that came as a reward for staked tokens=staking

The reason why we don’t have more strict guidelines is because there aren’t any and they are subject to the interpretation of the different jurisdictions. That bein said, here is an article from Bloomberg providing further context on the matter:

Now, the lender could be considered to have converted their crypto for another crypto when they “stake” their money into the liquidity pool and received another token they can sell elsewhere. That is a taxable event, so in this example, just as dividends are taxable, so are tokens generated from staking activities.

However, it’s not as straight-forward as that because this transaction can also be viewed in another way; in that what the lender deposited in the liquidity pool is still their money and the tokens they receive in exchange is nothing more than a receipt. That means it is not a taxable event.

Meanwhile, on the borrower’s side, it can be argued that depositing collateral and receiving a loan in a different token form is akin to an exchange transaction, so a taxable event. Of course, usually taking a loan is not a taxable event. However, the transaction on a DeFi is unique. Unlike conventional loans, it includes depositing one currency as collateral to receive a loan in another.

If you need any tax assistance with your crypto taxes, make sure you visit ACTAN in the Hub where any of our crypto tax professionals can help you out.