General

Transaction Type and Tag

By
Timmy
on
November 12, 2021

What is a transaction Type and Tag, and how do you use them?

The Transaction type and tag are tools to help the user define different transactions, the result of the tag is going to have an impact on the users tax outcome. The different tags are going to help the user to set up every transaction in the right way. Some of the tags are going to make a transaction a taxable event which means that you will be liable to pay tax. In order to avoid unnecessary tax events the user can use the tags and change the tax events.

For example; if you have donated your crypto to a charity, it's either going to count as a withdrawal or a sell transaction, which can be a taxable event. To avoid the taxable event you can use the "Tag" and tag it as a donation, because it was a donation which is not considered a tax event.

How we define different tags and transaction types

Transaction type:

  • trade: buying, selling, spending or transferring crypto to another wallet.
    The tax treatment for trade is going to be treated as a taxable event.
  • withdrawal: sending crypto out of your wallet, service or an exchange.
    The tax treatment for withdrawal is going to be treated as a taxable event.
  • deposit: receiving crypto into your wallet, service or an exchange.
    The tax treatment for deposit is going to be treated as a purchase at market price at the time of the transaction.
  • transfer: transferring or sending crypto to another wallet.
    The tax treatment for transfer is going to be treated as a non taxable event.

Tag type:

Taxable events:

  • buy: buying crypto for fiat or crypto.
    Bought crypto or stablecoins (taxable event).
  • interest: receiving a payment from a lending platform.
    Received interest on lent crypto (taxable event).
  • loan_out: sending liquidity to a liquidity provider.
    Lending of crypto or fiat (taxable event).
  • mining: earning crypto or a token for mining.
    Received crypto from mining (taxable event).
  • nft_buy: buying nfts for fiat or crypto.
    Bought nft (taxable event).
  • nft_sell: selling nfts for fiat or crypto.
    Sold nft (taxable event).
  • other_income: earning crypto or a token for other reasons.
    Received crypto for another reason (taxable event).
  • realized_profit: treating the transaction as a profit.
    Treat transaction as profit (taxable event).
  • reward: earning crypto or a token for doing a favor or work.
    Received crypto from rewards programs, work or staking (taxable event).
  • sell: selling crypto for fiat or crypto.
    Sold crypto for stablecoins or crypto (taxable event).
  • spending: spending crypto for goods and services.
    Spent crypto on goods and services (taxable event).
  • swap: changing crypto for another crypto.
    Swap tokens for another tokens (taxable event).
  • withdrawal: sending crypto out of your wallet, service or an exchange.
    Paid for goods and services or spent crypto from a third-party platform (taxable event).

Non Taxable events:

  • airdrop: receiving crypto or a token as an airdrop or gift.
    Received crypto from an Airdrop (non taxable).
  • deposit: buy or receiving crypto into your wallet, service or an exchange.
    Bought or received crypto from a third-party platform (non taxable).
  • donation: donating or giving away a cryptocurrency.
    Donating crypto (non taxable).
  • fork: receiving crypto or a token as a fork.
    Received crypto from a Fork (non taxable).
  • gift: receiving or giving crypto as a gift.
    Received crypto as a gift (non taxable). / Giving crypto as a gift (non taxable).
  • ignore: Ignoring the whole transaction.
  • internal_trx: transferring crypto between your own wallet.
    Transfer crypto from own wallet (non taxable).
  • loan_in: receiving liquidity from a liquidity provider for taking out a loan against crypto.
    Received fiat or crypto from a third-party platform (non taxable).
  • lost: stolen or lost crypto.
    Have no longer access to these tokens or coins (non taxable).

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