Wmemo/memo taxes

General Discussion
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I don’t know how it works in other countries, but I just watched several videos and read some lawyer stuff about taxes in my country GERMANY - and basically it says „once you stake and get even one tiny reward“, you have to hold it 10 years for it to be tax free…this is just fucked up. So it means that even if I wrap my memo, it would be too late because I staked it already for some time.

Do you know if this really is the case? Anyone from Germany or similar country where it’s the same? Or maybe I got it wrong or it’s not true - OR: I can hope for tax regulation to be morons so they don’t get it or don’t care :sweat_smile::sweat_smile:

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I’m not from Germany but from the quick 10mins of research i did:

basically it says „once you stake and get even one tiny reward“, you have to hold it 10 years for it to be tax free…this is just fucked up.
This seems correct. You had TIME ‘staked’ so now you must hold TIME for 10 years to be tax-free.

So it means that even if I wrap my memo, it would be too late because I staked it already for some time.
This is where it gets better.
You hold wMEMO. This is important. The wMEMO is not staked.
wMEMO is considered a crypto ‘token’.
So you only need need to hold it for 1 year to be tax free.

Now you did wrap/swap/trade, whatever you want to call it. You swapped your TIME into MEMO into wMEMO.
Track all these trades, because they were taxable events. But i doubt anyone is making a profit recently so you could even be better off declaring a capital loss as well

Resource: Germany Crypto Tax Guide 2022 | Koinly

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Yeah, I got that part of wmemo being a token because that’s the main benefit, but lets say I had memo before, staked it a month and THEN wrapped it. Wouldn’t it all be in the 10 year regulation already? :man_shrugging:t3: Or do you think after wrapping, then one year and I would be fine? Even if I used staked memo from before? I hope you get what I mean :sweat_smile:

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but lets say I had memo before, staked it a month and THEN wrapped it
Ok i’m following…

Wouldn’t it all be in the 10 year regulation already?
I lost you here.

Your record should look something like this for example:

Sunday: You buy 1 TIME and stake for MEMO
*Let’s say TIME/MEMO =$1000
*Your cost basis is $1000
*You will pay taxes if you dispose of MEMO if sold within 10 years
*But if you hold MEMO for 10 years+ from the Sunday, you will pay no tax

Now let’s say
Wednesday: You swap MEMO for wMEMO
Let’s say the price of TIME is $1100
*You disposed of TIME after only 3 days, so you pay taxes because it hasn’t been 10 years.
*you have a gain of $100, add that to your income for taxes.
*You gain wMEMO token at cost basis $1100
*If you sell wMEMO you pay taxes if sold within a year from the Wednesday
*If you sell wMEMO after 1 year+, you pay no taxes.

Now with your rebases, you would have had 9 rebases in the 3 days, so according to the German tax it would look something like this:

Sunday:
Rebase 1 = You gain 0.006MEMO [or $6]
*You will pay taxes if you dispose of this MEMO if sold within 10 years
*But if you hold MEMO for 10 years+ from the Sunday, you will pay no tax
You write in your records that you made an income of $6 on Sunday, cost basis $1000 or whatever the price was for TIME

Rebase 2 = You gain 0.006036 MEMO [or $6.036]
*You will pay taxes if you dispose of MEMO if sold within 10 years
*But if you hold MEMO for 10 years+ from the Sunday, you will pay no tax
You write in your records that you made an income of $6.036 on Sunday, cost basis $1000 or whatever the price was for TIME

Rebase 3 = You gain 0.006072216 MEMO [or $6.072216]
*You will pay taxes if you dispose of MEMO if sold within 10 years
*But if you hold MEMO for 10 years+ from the Sunday, you will pay no tax
You write in your records that you made an income of $6.072216 on Sunday, cost basis $1000 or whatever the price was for TIME

Then repeat for Monday, Tuesday, Wednesday or every single day that MEMO was staked.

You can see why people prefer to just holding wMEMO rather than recording their rebases 3 times a day.

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go move to Portugal, they have good crypto tax laws

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I will ask my wife :sweat_smile:

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@rocko_3_3 thanks a lot, that seems plausible :+1: anyways, I will just wait, hold it and then see…it’s all new for me!

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