Follow these steps and do not sell below your BEP and you will always make a profit.
But what happens if price keeps going down and you never get back to break even?
What do you do then?
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Follow these steps and do not sell below your BEP and you will always make a profit.
But what happens if price keeps going down and you never get back to break even?
What do you do then?
Sell it and write the loss off against your taxes. 😉
😂😂.
A crypto investment is considered a capital investment. Selling what you bought at a profit or loss is considered a capitl gain or loss, for tax purposes. Staking creates an income investment. Selling what you gain from a stake is considered income and taxed as such. That is why it is important to track your expenditures, as I have described, if you wish to navigate tax codes correctly. Converting from one token to another should be looked at as a sell of one asset and a buy of the other asset, using the tracking system I have described in this post.
I still have yet to fully institute this myself. It would be nice if the blockchain could track these transaction types automatically for users, but that would take some serious mathematics and assumptions across wallets.