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RE: Steem Rewards History CSV Exporter (via SteemData.com)

in #taxes4 years ago (edited)

@jesta

Thank you for putting this together, the in/outs in Steemit taxation are an issue I have covered extensively.

Two quick questions

  1. Where is the USD pulling from?
  2. How does the USD field value Steem Dollars?
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No problem, I needed the data as well.

  1. The USD value was pulled from the coinmarketcap historical pricing by date.
  2. The USD field actually uses the USD value of SBD for each date, it doesn't pretend they're $1 USD.

There are CSV/JS files for each currency in the historical folder of the project:

https://github.com/aaroncox/steemdata-reward-history/tree/master/historical

Those are the values it's using.

steemdata-reward-history/historical/mvest_history.csv and steemdata-reward-history/historical/mvest_history.js show steem/mvest as fluctuating. This is NOT correct. It should increase monotonically.

I know that the formula is pretty simple but don't know what it is or where to find it. Can anyone else help?

I think I can, with a fair amount of code I wrote in a previous article.

I suspect the last two thirds might be not particularly useful for you, but the opening bit definitely is.

Thank you! Personally I am very excited to try this out.

In my opinion, the SBD value on reward date is the true marketable value of SBD as you have calc'ed (not the internal $1). Also I believe for basis tracking, units of SP, SBD and Steem are relevant so I am glad they are part of the template.

I have a small couple extra comments in general that hopefully might help.

  1. For U.S., the SP, Steem and SBD are separate assets, it might make sense to have a separate breakdown of the USD value column for each to track adjusted basis (assuming SP = Steem's value). For example many authors lately were cashing out their SBD but leaving their Steem or SP alone. This may already be built in to the functionality so if it is my mistake!

  2. I am not sure how other jurisdictions would treat Steemit earnings, but if there is a way to add values for other FX (Euros, etc. if coinmarket cap offers that), it would potenially help out some other countries along the way.

Thanks again for this great product. I was dreading going through a manual process.

IANAL, nor accountant. But "success" on steemit has me looking for answers.

Regarding comment 1, is SP considered a virtual currency? Sure, it has value relative to Steem and SP, but it's not traded on exchanges, only on the internal steem platform (arguably an exchange, but it is not traded on the steem market), and there it doesn't appear to be traded between users of the network, but instead between the platform and a single user (so not really applying to the exchange definition, nor in lieu of real currency definition).

The 2014 guidance from the IRS does loosely define a virtual currency in an example, but states that it acts as a substitute for real currency. Except you don't use SP as a substitute for real currency. It is awarded, but it is not exchanged itself for money nor is it traded on an exchange. Only in the platform (again, not even the market) does it seem to have a value. The 2014 guidance references the Guidance on the Application of FinCEN's Regulations to Persons Administering, Exchanging, or Using Virtual Currencies (FIN-2001-G001, March 18, 2013) for a more in-depth explanation of virtual currency.

The FinCEN document repeats this loose definition of "virtual currency either has an equivalent value in real currency, or acts as a substitute for real currency."

Is SP really acting as a substitute for real currency and therefore a virtual currency? You can only purchase it with STEEM (via powering up) or receive it from the platform as payout, and you can only sell it for STEEM via the powering down process.

For a poor analogy, consider World of Warcraft gold (sorry, I hate it when people make a poor analogy, and even more when they inappropriately use WoW gold). WoW gold is not traded on exchanges, it is only traded in the platform (World of Warcraft). You don't have to pay taxes every time a quest awards you with gold in WoW. You only have to pay taxes if you sell that gold to another person for (real or virtual) money. You can't sell your SP to another person, it seems to me even less a virtual currency than WoW gold. And in the world of steemit, if you have lots of this gold, you certainly have clout on the platform, but then you can't even sell this to other people, you have to convert it (power down process) within the platform and sell that thing instead... granted you can be bribed with other currencies, but you aren't surrendering your vests when you vote on something, nor have you surrendered them via delegation.

Of course, this raises new concerns. Full payouts in SP would not be taxable as income until powering down, for example. And the process of converting STEEM to SP would be ambiguous in how they are handled, do you count it as (either short or long term capital) loss when you convert to SP when SP value in vests times the amount is lower than the value at which you obtained your steem? But then pay income tax when you power down and forget any basis with the SP because it's not itself a virtual currency?

You have a very well thought out question. I actually did address my opinion regarding these points:

https://steemit.com/steem/@cryptotax/are-steemit-rewards-taxable-in-the-usa-part-2

I can't provide personal tax advice but for my purposes, I'm treating Steem Power as if it is Steem for tax purposes.

I did find that article after posting my question, but refrained from follow up edits or posting until after you had a chance to reply to my initial question.

I can't provide personal tax advice but for my purposes

I understand, completely.

I'm treating Steem Power as if it is Steem for tax purposes.

I'll have to pop over to your other article for a follow up on this as I'm not (yet) convinced that delegation constitutes trade. In the mean-time, perhaps other intrepid filers will speak up with their input.

This is an unclear area tax law other opinions are definitey welcome as we try to make sense of this new technology, hopefully grounded in some degree of research like you and I. We are both in pursuit of the same knowledge. Nothing is 100% certain, however I am attempting taking a common sense route based on what I can only guess is the IRS' next move if Steem gets big.

Also just to add some thoughts on video games. With regards to World of Warcraft there are many avenues to convert gold into fiat (however some might violate Terms of Use). I also believe there was a way to exchange the gold for 30 days of game time which has a real world economic value. The items traded on the short-lived Diablo 3 real world market may have been considered convertible virtual currency as I understand real money was being spent on items or earned on sales of items. I can only hope the IRS would look at video game taxation on a case by case basis because (I believe) most people just play the game without trying to make any money off of it there's no need for there to be unlimited uncertainty for just buying a video game to play it.

I also believe there was a way to exchange the gold for 30 days of game time which has a real world economic value.

Oh, yes! I forgot they had done that! Some googling reveals that they issued tokens for real money, then these tokens could be sold on the auction house in-game. Then they expanded this so you could use the tokens to purchase other Blizzard goods.

That certainly sounds like an exchange, doesn't it? I'd say that puts this token and gold into the virtual currency camp, because they now provide a means of exchange for both money to tokens and tokens to gold, all within their platform. But they only provide an avenue to convert money to services and goods they provide. They don't provide a means of exchanging these items to other currency, so does this satisfy the definition of a convertible virtual currency? Rather confusingly, when the IRS talks about virtual currencies in the 2014 guidance, they only care about convertible virtual currencies.

So even though you can use gold and tokens to pay for goods and services provided by Blizzard, it doesn't appear to fit the definition of a convertible virtual currency, so it's not covered by the 2014 guidance.

With regards to World of Warcraft there are many avenues to convert gold into fiat (however some might violate Terms of Use).

But isn't this important? They provide no such exchange, they encourage no such exchange, but STEEM and SBD are fully endorsed and encouraged for use as currencies and there are APIs and web sites provided to make this happen.

Does the existence of a third party site willing to act as a "trusted" medium to facilitate the exchange of in game gold/tokens to other currencies constitute an exchange? I'm having trouble finding a legal definition that validates -OR- invalidates this, but I suspect it does not.

Good questions, I'm glad I'm not the only one pulling my hair out:)

I'm going to make WoW and Diablo 3 taxation into a discussion topic on my blog to highlight the perplexity of tax law. It's not just selling gold that has issues, some raid groups also get paid to carry noobs through raids. These types of nuances I will flesh out in all the painful details, without taking up more space in this comment section haha.