How to file your Ether.Fi (eETH) taxes with Koinly

Ether.fi is a decentralized staking protocol that utilizes EigenLayer technology for to provide liquid staking tokens to maximize ETH staking rewards. But your Ethereum staking rewards will come with a tax bill. Whatever your investments, Koinly can help calculate taxes for hundreds of Ethereum dApps including Ether.fi. Here's how.

1. Sign up to Koinly and choose your country and currency

2. Connect Ethereum with Koinly to import all your trades safely and securely

3. Koinly identifies the cost basis of your tokens and coins, as well as your taxable transactions

4. Koinly calculates any capital gains, losses, and income from your taxable transactions

5. Koinly generates your crypto tax report - ready to help you file with your tax office, or hand it over to your accountant.

How are decentralized Ethereum staking protocols taxed?

Crypto tax varies depending on where you live, but generally, Ethereum staking rewards are subject to Income Tax upon receipt - regardless of how you're staking.

But there is a caveat to this - because it all depends on how your protocol works and what your crypto tax rules are. Earning new tokens from staking is generally considered additional income by tax offices, but with some protocols, you receive tokens that represent your original asset that accrue value. As such, no gain is realized until you trade those tokens. In these instances, you may be subject to Capital Gains Tax instead. You can learn more in our DeFi tax guide.

Can the IRS track DeFi investments?

Yes. While your wallet may not reveal any personal details about you, all transactions for Ethereum are recorded on a public ledger that anyone can view. This includes wallet addresses, all transactions associated with a given wallet, wallet holdings, and more. All the IRS needs to do is link you to a given address - and they've hired agents to do just that.

Read next: Can the IRS track crypto?

How to get Ether.fi tax documents

How to prepare and file your crypto taxes depends on your tax office, but you'll usually report your gains or income from crypto - including Ether.fi investments - as part of your annual tax return.

To do this for your Ether.fi transactions, you'll need to identify the fair market value of any staking rewards in your fiat currency on the day you received them, as well as the value of any re-staking rewards. As well as this, you'll need to calculate any other gains and losses from other investments from other crypto platforms.

If you think that sounds time-consuming, you’d be correct - which is why most investors use a crypto tax calculator like Koinly. Koinly can calculate your gains, losses, and income for more than 800 wallets, exchanges, and blockchains.

How to import Ether.fi (eETH) transactions to Koinly automatically

To import your Ether.fi transactions into Koinly, you’ll need to connect the Ethereum wallet you use with Ether.fi to Koinly (or multiple wallets if you use more than one). This is really easy to do, you just need your wallet address. We've got instructions on how to connect popular Ethereum wallets like MetaMask, Coinbase Wallet, Argent, and more on our integration pages - but here's an example of how it generally works.

In your wallet

1. Open or log in to your wallet

2. Select the blockchain you'd like to connect to Koinly - in this example, Ethereum

3. Copy your public address

On Koinly

1. Sign up or log in to your Koinly account and go to the wallets page

2. Search for and select the blockchain you'd like to connect to - in this example, Ethereum

3. Give your wallet a name - for example - MetaMask Ethereum

4. Paste your public address