How to file your LidoDao (LDO) taxes with Koinly

Lido is a liquid staking solution for Ethereum, Solana, Polygon, Polkadot, and Kusama - allowing investors to put their staked tokens to work, while LDO is the native ERC-20 governance and utility token for the protocol. Users can use LDO tokens to vote on developments for the protocol and earn them through referral programs, airdrops, and more. Whatever your investments, Koinly can help calculate taxes for thousands of ERC-20 tokens, including LDO. 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 - including ERC-20 tokens like LDO

  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 LidoDAO (LDO) tokens taxed?

The taxes you pay on crypto - including LDO tokens - depends on where you live, so read our crypto tax guides for specific information about where you live. But broadly speaking, two taxes may apply to your LDO transactions:

  • Capital Gains Tax:  When you sell or trade LDO tokens, you’ll usually pay Capital Gains Tax on any gain you make as a result of the transaction.

  • Income Tax: When you earn new LDO tokens - for example, from airdrops, referral bonuses, or through other incentives - this could be seen as additional income and you may need to pay Income Tax based on the fair market value of your LDO tokens at the time you received them.

Can the IRS track LDO?

The IRS, and other tax offices, have highlighted crypto as a key focus this tax season, and your LidoDAO investments will be no exception. But can the IRS track crypto?

Your LDO transactions are all recorded on the Ethereum public ledger... and a public ledger is just that - public. Anyone can search for a given address to look at the transactions made - including the IRS. If the IRS can link your identity to a given wallet or transaction - then they may know about your investments, even if you’ve used decentralized protocols like LidoDAO and non-custodial wallets.

As always, we recommend a conservative approach to crypto taxation to avoid provoking the ire of the IRS and potential audits or crypto tax penalties.

How to get LidoDao (LDO) 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 LidoDao investments - as part of your annual tax return.

To do this for your LDO tokens, you'll need to identify each taxable transaction involving LDO tokens, and the kind of tax that applies. So you'll need to calculate a capital gain or loss for every time you sold or swapped LDO tokens, as well as calculate the fair market value in your fiat currency for any LDO tokens viewed as additional income.

If you think that sounds time-consuming, you’d be right - which is why most investors use a crypto tax calculator like Koinly. Koinly can calculate your gains, losses, and income for more than 450,000 ERC-20 tokens - including LDO!

Of course, when we talk about LidoDAO taxes, many investors will be wondering whether Koinly can help them calculate their other transactions relating to the LidoDAO protocol - and the answer is yes! You just need to connect your blockchain to Koinly to do so using your public address. Here's how it works.

How to import LDO transactions to Koinly automatically

To import your LDO transactions into Koinly, you’ll need to connect each Ethereum wallet you use to Koinly.

This is really easy to do, you just need your public address - but remember, you’ll need to do this for each Ethereum wallet you use to interact with LDO in order for Koinly to correctly identify your cost basis, transfers, sales, swaps, and more. As well as this, if you're using the Lido protocol to stake tokens and transacting with other tokens - for example, stSTOL, stMATIC, stDOT, and so on - you'll need to connect these blockchains to Koinly as well using your public address in order for Koinly to calculate your crypto taxes accurately.

You can find steps on how to connect a variety of popular wallets to Koinly 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

Important

  1. Remember, you’ll need to do this for every wallet you use to interact with LDO tokens (and any other wallets you use to interact with the Lido protocol) in order to calculate your crypto taxes correctly.

  2. It’s really helpful to name your wallets when you’re adding them to Koinly. This can help you find any transactions you believe have errors later on much more easily!

  3. You may also be able to upload your transaction history to Koinly as a CSV file instead of connecting using your public address if you prefer, but this depends on the wallet you’re using. You can search for your wallet on our integration pages to find out more about how to get a CSV file from your wallet.

Your frequently asked questions

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