Hi all,
l’m trying to sell some of my SOL, but I need to capture the loss for tax write offs (my average cost on Robinhood was $50.85). How can I best sell my coins and still take advantage of the losses? I’m guessing I would convert SOL to USDC inside Phantom Wallet and then send the USDC to Robinhood on the SOL network? (they still have support for that at least, and I just tested this process with a small amount of SOL and USDC). And then I can cash out the USDC for USD within Robinhood?
Backstory: I had posted some months ago about needing to transfer my SOL from Robinhood to Phantom, and you all helped greatly with that (especially when my coins got stuck). And I’ve staked most of my coins, like 800 SOL worth so I also don’t know if I need to report the rewards when I unstake portions to sell.
I’ve recently read some posts here about best ways to sell SOL and I see a lot about some off ramp things and Coinbase or Binance.US, but I’d ideally like to keep using Robinhood since I originally bought all my SOL on there and I think doing the cost basis and tracking should be simpler there. I appreciate any help!
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Firstly, I just happened to see a notification from YouTube (Paul Barron’s channel) mentioning something about Robinhood reinstating SOL and other coins. So you might be able to just transfer your SOL there soon (instead of trading it for USDC or other tokens).
Secondly, yes, you will need to report your staking rewards. There are a lot of different crypto tax apps to help you figure that out.
Thirdly, do you need some tax loss harvesting from profits elsewhere? Not sure why you’re taking the loss? If you wait long enough, you’ll be back in profit. 🤷♂️
I use Coinstats to track all my SOLs from all the wallets and CEXes, there’s also a way to generate taxes in one click. Might be useful for you.
Okay great, thank you! And this keeps track of all of your conversions and sell orders? So like, SOL to USDC and USDC to USD specifically that came from the SOL? Or I guess the only taxable event is SOL to USDC, since USDC is stable.
Move it to wallet like phantom N dump it on dex 63-68 is good target 75 possible but its greedy target coming from 9$ low. Dump it n wait few months to start rebuying at lows. Jupiter is a great dex to trade on
You just do your taxes. You have to report all your transactions and the loss/gain of them. What it comes out to in the end is what you pay on or get credit for.
I switched to CoinLedger – much simpler than CoinTracker imo
Okay cool, thanks for the tip!
Hmm okay I see. I guess I’ve only done crypto taxes with Robinhood before, since I’ve never sold any of my crypto from Coinbase, GDAX / Coinbase Pro, Binance, etc. So I had a very simple tax to calculate this year for 2022, since Robinhood gives you a 1099 with all your bases and loss/gains. I tried Cointracker this year but got stuck on something, so I’ll look back into that. Thanks!
With sol going back in robinhood, could be good for Solanas price action
I didn’t even know this was happening, that’s awesome! As much as Robinhood sucks, I really did enjoy the 0 fee buys and the simplicity. I’m probably going to sell on there if I can then.
I would recommend against selling now, not sure how closely You’ve been following Solana, but it’s my biggest holding in crypto, 2nd being Ethereum. Sounds like your average is a bit high but I definitely would not sell for a loss now.
The only reason I am trying to sell (some) now is because I just lost my job last week and needed some liquidity for a few urgent things. But as we speak, SOL is just above my average of $50.85 which makes me very happy!! I’m still going to hold for a bit
ur close to break even
rinse ur coins and throw them into a few new wallets then claim them as a total loss (you lost ur coins and the keys to ur wallet), use vpn and something like tornado cash. do it in small chunks for safety.
That’s true, and the price just went up again to almost $47! What exactly do you mean by rinse my coins? And okay I’ll look into the tornado cash and VPN thing. And claiming as a total loss, that’s something I would do when I file my taxes or that’s something I would report to Phantom after I transfer the coins to new wallets?
hit my sell order at 48$
will look to buy some when drops back to that $36-32 range
rinse/wash (remove all digital footprint your coins have. if u bought/transferered through c’ex, those coins can be traced to your wallets. tonrado cash was awesome b/c its like a laundry mat for dirty cash, in crypto. still functions just need to do some research. never throw a big pile of crypto in there, not without test the waters with a tiny splash first.
Yes, u can claim it ALL as a loss. U wont benefit financally from it, but if u trade stocks, it can count towards offsetting those future gains should u chose to invest into stocks at some point. speak to your accountant and ask a few others to get their professional pov (dont tell them ur gunna wash/hide ur crypto, unless its an accountant ull never see again, u can ask them for their pov).
u dont report nothing to phantom. thats YOUR wallet. so wtvr transfers n trades u made through phantom and any account that is associated to this wallet, the govt can trace it all and then ask u to pay capital gains tax on your gains.
I am in similar boat so its why I brought topic up.
first do the research and find out what u need to do. then get ur crypto tax stuff for reporting so u know exactly how much $ u threw in. once u have ur game plan, prepare to move things around into new wallets, then for washing/rinsing into new wallets. once its done, never connect those wallets to anything. keep like 2 new browser wallets for trading (like 1 phantom and 1 metamask for example) and a couple hard/cold wallets for LT savings/holdings like a hidden bank account that nobody knows about. you’ll need to be a bit skilled at doing all the basic stuff setting up new wallets, recording keys/passphrase/passwords etc. its work, but once its done n completed u wont have to worry or do much aside from occasion transfers/trading. and when the time comes if u decide to cash out, well, be glad that u accomplished financial goals ;)
Read this but didn’t get to reply before. Well thank you for this detailed breakdown! I’ll definitely have to do more research and see if I’ll go into all of this, but I get the value of it. Right now I’m at a decent gain with the price being well above $50, so I don’t need to worry about selling at a loss. I’m swapping some coins to USDC and was just going to transfer it back to RH or to Coinbase to sell, but I’ll see if I should do more anonymous actions like you’re suggesting.
dont transfer to c’ex man
use d’ex like jupiter. you can plug in your orders it will fill all u have to do it settle the account once filled. gas is cheap too!
Yeah I just started to check out Jupiter today, I’d done swaps within Phantom thru Jupiter but that 0.85% fee is hefty. I was converting SOL to USDC within Phantom and moving the USDC back to Robinhood to sell, but I’m not sure how I can still exchange my USDC to USD on a DEX. Does Jupiter have an option to connect a bank account? I’m still looking into all of this