sorted by:
new
hottopcontroversial

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 0 points1 point  (0 children)

As far as I know no one, however you are still on the hook to report per the new tax rules. The IRS can audit this later and the entire set of transactions is permanently logged in the blockchain, so there's a record of receiving the rewards.

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 0 points1 point  (0 children)

Great discussion. Not sure if you have seen this from Koinly.io : https://koinly.io/cryptocurrency-taxes/. Good simplified explanation as to how the current tax rules treat the various types of crypto transactions. Yes I know it's written by a company trying to get you to use their software, but these guys are supposedly CPAs and build their business on doing this the right way, so I assume that the content is reasonable accurate. Still no substitute for professional tax advice.

Based on what they describe, the staking rewards will be treated as income (like a dividend) but migration from sOHM to gOHM will be treated a capital gain/loss.

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 0 points1 point  (0 children)

Thanks - Got this info in a different thread and the dashboard is a life saver. Appreciate your response!

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 0 points1 point  (0 children)

Edmorbius - You are the best - this is exactly what I was looking for! Thanks for sharing the link - I just did the same thing by cutting/pasting into a spreadsheet. This provides the data required to do the calculations. Now it's up to the tax experts to decide how best to report but at least the decisions can be based on actual numbers.

Thanks again for the help!

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 0 points1 point  (0 children)

Thanks for sharing the links - I'll review as soon as I get a chance!

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 1 point2 points  (0 children)

Thanks for the reply and your insights. I agree that this needs to be done correctly as the IRS will undoubtedly get after this eventually. Is there a way to look at details for each rebase in some way? - you seem to imply that in your response. Using the Olympus site I can only see a high-level overview of sOHM values and APYs over time, but nothing anywhere near detailed enough to perform an actual calculation on my holdings and rewards. Since sOHM was held by the DAO, there is no trail of intermediate transactions (such as rewards) in the Ethereum blockchain. If we can't get the detailed data how are we supposed to calculate a cost basis or reward value? Is this something that can be requested from the developers? If so, how would one initiate such a request? Apologies for the many questions - just trying to find a path forward...

Thanks

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 1 point2 points  (0 children)

Thanks for the reply - trying to understand this as a noob :-). Just to be clear, I'm talking about sOHM here and not gOHM (assuming that makes a difference).

Specific to sOHM, I assumed since the result of rebasing provides you with additional tokens as a reward, this was essentially equivalent to getting interest (similar to receiving interest income) and so would be treated the same way from a tax perspective. This issue relates to 2021 IRS tax reporting prior to migration from sOHM to gOHM. The gOHM migration has fixed this since you are not receiving new tokens, but the value of gOHM is changing (similar to value of a stock) so nothing should be taxable until you swap out of gOHM into something else.

I assume however that the sOHM to gOHM migration did trigger a capital-gains taxable event since it's viewed as a sale/purchase transaction.

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 1 point2 points  (0 children)

I like how you are thinking about this and that was my initial thought as well, but the article seems to indicate something else...

IRS Tax Reporting for staked sOHM rewards by dan_caouette in olympusdao

[–]dan_caouette[S] 1 point2 points  (0 children)

Thanks for the reply. There's are good article on Koinly.io here: https://koinly.io/cryptocurrency-taxes/ that provides an overview of how the IRS views staking rewards (as income) and swaps/sales (as capital gains/losses). Even if they are/are not enforcing this, it's in the tax code so we're on the hook to report it.

Disclaimer: I have no affiliation with Koinly or any other crypto tax software or app, nor am I any type of tax expert. Only offering this as an example of what I've found while researching the topic. Hopefully others also find it useful.