ETH2 counts as income in Kraken?

Describe the problem:
Koinly is reporting staked ETH2 rewards as income. This cannot be sold until ETH2.0 comes out, so shouldn’t it not be taxed?

Which exchange/wallet is this regarding?
Kraken

How did you import data into this wallet?
API and imported csv

What have you tried to fix this so far?
None

Tell that to the government. If you have obtained tokens that are of value, it counts as income of that value. I doubt the governments make allowances for if you can move it or not. Just like super & 401k you are taxed on that even if putting it into something which is a delayed reward.

I think some nations have special rules for airdrops which aren’t counted as income but an obtained value of $0 which upon sale is the total capital gain increase but I’m not sure what jurisdictions this is in.

Hello!

Alex from Koinly here :slight_smile:

Like Michael mentioned most countries would still consider these to be valuable assets, so Koinly will treat them as such.
If you don’t want them to have any income tax applied then you would have to remove the label on them so they show as a “Deposit” instead.
But this could pose problems later on when you dispose of them since they will be counted as capital gains, and would have to go back to label them as income again before disposing.

I hope this helps!

Best regards,
Alex

Well hopefully this paves the way for the future. One couple won their case and got a refund from the tax paid on their unsold stake reward.

Taxing staked rewards at the time of receipt doesn’t really make sense since the value can go up or down by the time you sell.