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Tax question for those who staked ETH on Coinbase

Etherum Reddit

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Hey all, sorry if this has been asked before.

I was one of the fools who staked their ETH on Coinbase a couple years back. As soon as it was eligible to be unstaked in 2023, I did so, and then moved it off Coinbase to a secure external wallet.

I didn't think much of it until I went to generate my CoinTracker tax reports today. I see under my transactions that the process of unstaking my ETH is showing up as a taxable event, because Coinbase stupidly chose to designate staked ETH as a different coin named ETH2.

So in this case, what that means is that when I unstaked my "ETH2" in 2023, Coinbase treated it as a sale of ETH2 and a purchase of ETH. So under my Cointracker tax reports, it's showing a tax loss from the sale of Eth2 and an entirely new cost basis for the purchase of ETH.

Does anyone know if this is accurate? Should I just let it go the way it is and if I ever got audited, explain what happened / say I was just trusting the data that Coinbase and Cointracker generated?

Or would you guys suggest going through manually and deleting all the eth2 transactions, so that for all practical purposes nothing shows up as a sale of eth2 or a purchase of ETH?

submitted by /u/paulrudder
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