It appears that HBAR moving to HBARx on Stader will

be a taxable event? Is native staking also planned separately this year?

Its when u dispose of something... Moving your piece of gold from one place to another is not disposal..u still retain ownership..therefore its not taxable.

I agree - looks taxable to me. Native staking is on the road map for this quarter. One thing to consider…native staking rewards are treated as income by the IRS and taxed accordingly. Whereas with Stader there is no income from staking - rather the value of HBARX increases. In both cases (native and Stader) you have to pay the same tax on gains, but with Stader you avoid the ongoing income tax on the rewards. Here’s an article on the swap being taxable… https://www.dlapiper.com/en/us/insights/publications/2021/07/irs-concludes-section-1031-tax-deferred-like-kind-exchange-treatment/

Thank you. If the HBARx price can vary significantly from the HBAR price yes I think that would mean capital gains tax would apply whereas with native staking no CGT event will occur on the HBAR held. e.g. Someone bought HBAR @ 3c and then stakes for HBARx when HBAR is at 13c, that CGT event will be very undesirable for a large holder whereas with native staking no CGT event occurs, income tax will only be incurred on rewards.

That’s true if you never sell your HBAR…ever. However if you plan on selling your HBAR some day you’ll pay the same CGT on both - just spread out. With Stader some now some later. Native all later plus income tax on all your rewards as you go.

EXAMPLE Making up the numbers for easy math. Buy 100 HBAR @ .10 cost basis = $10 Swap 100 HBAR for 100 HBARX when HBAR was priced @ .20. So sale price of 100 HBAR is $20 - pay capital gains tax on the $10 gain. Cost basis of the 100 HBARX is $20. Down the road HBAR price is $1. Swap 100 HBARX and get 110 HBAR for it. Sell price for HBARX is $110. Pay capital gains on the $90 gain. New cost basis for the 110 HBAR is $110. Avoid all income tax for rewards along the way and keep Uncle Sam happy with fully reported capital gains. Juxtapose that with native staking assuming same time frame and APY… Buy 100 HBAR @ .10 for cost basis of $10. Earn 10 HBAR keeping track of each reward deposit, reporting that value as income and paying your regular rate on that income. Also using that value as the cost basis for every reward along the way. HBAR reaches $1 Sell 110 HBAR FOR $110 and pay capital gains on the $100 gain. (It would be slightly less if you added in the fractionalized value of the rewards as they came in. Have fun with tracking that!) In both cases you are paying capital gains on $100. But with native staking you have the rewards income tax added in along the way. Stader allows you to avoid those ongoing income taxes because you are not receiving staking rewards in your wallet.

Yes I can see that being beneficial for many.

You are right though on the hit up front. Big part of the decision process.

That's me. I'm happy to never sell if I can avoid CGT and collect rewards for native staking. With another project this is my policy, never sell but sell rewards immediately avoiding CGT calculations and just paying income tax. Stader looks like a good option if I want to stake HBAR I'm long term trading with.

My adult son is an ETH maxi. He tells me “If Hedera does hit I’ll get it when you’re dead and I won’t have to pay taxes on it!” So that’s another way to get around CGT 😜

🤣👍

I have zero problems paying taxes. That’s the law of the land. My only issue is, when it comes to CRYPTOS, it’s an absolute mess regarding collecting required information to give to your accountant!!! Honestly, I wouldn’t even know where to begin. How do you even get the necessary financial information from KuCoin, Stader, whoever????? 🤦‍♂️

All I do is buy and hold and the only crypto I have is HBAR and now HBARX. Bittrex gives me a record of all my buys. I have that info in a spreadsheet and I just noted HBAR price when I swapped to HBARX. I’ll note the price when i swap back. It’s pretty clean. I imagine it would be a nightmare with a lot of activity. However I do believe there are some programs out there that can handle it all for you.

If you know, or learn of any good programs, please let me know. Thanks.

Just a sec…

Native Hedera staking is available in Q2. So within the next 2 months.

Stader staking is a taxable event. You are disposing your HBAR crypto for another crypto called HBARx. Crypto to crypto is taxable.

Ohh didn't realize hbarx was a seperate token.