{"id":32770,"date":"2022-08-05T05:58:17","date_gmt":"2022-08-05T09:58:17","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=32770"},"modified":"2022-08-05T05:58:21","modified_gmt":"2022-08-05T09:58:21","slug":"crypto-stolen-from-solana-might-be-claimed-as-tax-loss-experts","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/crypto-stolen-from-solana-might-be-claimed-as-tax-loss-experts\/","title":{"rendered":"Crypto stolen from Solana might be claimed as tax loss: Experts"},"content":{"rendered":"\n
Tax experts say that while U.S. investors will lose money, Australian, Canadian, and U.K. crypto investors may be able to claim hacked cryptocurrency as a tax loss.<\/h5>\n\n\n\n
\"Crypto
Crypto stolen from Solana might be claimed as tax loss: Experts<\/figcaption><\/figure>\n\n\n\n

It turns out that digital assets lost during an attack or hack might theoretically be claimed as a tax loss, providing you live in the proper country, experts said. For unfortunate crypto investors wanting to turn lemons into lemonade.<\/p>\n\n\n\n

This may be some much-needed solace in the wake of the announcement that more than 8,000 Solana wallets<\/a> had been accessed and that an estimated $8 million in cryptocurrency had been stolen due to a security breach in Web3 wallet provider Slope's network.<\/p>\n\n\n\n

\n

The Solana hack, and it\u2019s possible tax consequences: A thread \ud83e\uddf5 https:\/\/t.co\/JnYMrkB8qJ\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a><\/p>— Crypto Tax Calculator (@CryptoTaxHQ) August 3, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

Shane Brunette, the CEO of the Australian company CryptoTaxCalculator, stated that in some countries, crypto<\/use><\/svg><\/span><\/a> lost due to a hack or exploit could be reported as a loss for tax purposes.<\/p>\n\n\n\n

\u201cThis means the original amount you paid for the asset(s) can be used to offset other capital gains.\u201d<\/p><\/blockquote>\n\n\n\n

When questioned if comparable rules apply in tax jurisdictions other than Australia, the nation where the company that makes tax software is situated, Brunette responded:<\/p>\n\n\n\n

\u201cMany countries have a provision to allow for these types of tax deductions [\u2026] however, you should work closely with a local tax professional and make sure you keep adequate proof of the loss.\u201d<\/p>\n\n\n\n

The same was corroborated by Danny Talwar, Head of Tax at Koinly, who stressed that in Australia<\/a>, one must provide proof that the stolen cryptocurrency was in their possession at the time it was taken.<\/p>\n\n\n\n

\u201cTo claim a capital loss for hacked crypto, you'll need to demonstrate evidence to the Australian Tax Office (ATO) that the crypto is lost and it was under your control.\u201d<\/p><\/blockquote>\n\n\n\n

Talwar added that it was crucial for the tax authority to have sufficient proof that cryptocurrency was irretrievably lost. He advised using blockchain explorer tools like Etherscan and Solscan to gather reliable proof of the hacker's destination address, which may also show that a sizable amount of stolen money was involved.<\/p>\n\n\n\n

Any proof of a hack must also include the corresponding wallet addresses, as well as the dates when the private keys were obtained or lost, according to Australian tax legislation.<\/p>\n\n\n\n

According to a blog post by CryptoTaxCalculator, according to the tax change passed in 2017, U.S.-based cryptocurrency investors can no longer claim stolen cryptocurrency as a tax loss.<\/p>\n\n\n\n

Things are a little more difficult for residents of the UK and Canada, but if investors are prepared to follow the specific procedures outlined by each country's tax agency, they may be able to claim a tax loss.<\/a><\/p>\n\n\n\n

Hackers and other bad actors have stolen around $2.6 billion in digital assets so far this year alone, with cross-chain bridge assaults being responsible for 69 percent of the total loss.<\/p>\n","protected":false},"excerpt":{"rendered":"

Tax experts say that while U.S. investors will lose money, Australian, Canadian, and U.K. crypto investors may be able to claim hacked cryptocurrency as a tax loss. It turns out that digital assets lost during an attack or hack might theoretically be claimed as a tax loss, providing you live in the proper country, experts […]<\/p>\n","protected":false},"author":38,"featured_media":32775,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[132,275],"class_list":["post-32770","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-crypto","tag-solana"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/08\/1200_2.webp","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/32770","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=32770"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/32770\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/32775"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=32770"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=32770"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=32770"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}