TL;DR:
Celsius settlement payments can be entered in CoinTracking in different ways, depending on how you previously recorded your Celsius balances and whether you already filed a tax report. The main options are recording only the net difference as Lost, marking the original coins as Lost and the settlement as Income, or treating the settlement as a Deposit while keeping the original coin history. The correct approach depends on your individual tax situation, so consult a tax advisor if you are unsure.
Option 1: Record only the net difference as Lost
If you have not yet filed a tax report that includes Lost transactions, you may keep the original coins in Celsius and only mark the net difference as Lost.
This means that you do not mark the full Celsius balance as lost. Instead, you only record the difference between the original amount and the settlement amount as lost.
Important:
This option only works if your tax report has not already been filed with the Lost entries.
Option 2: Mark previous coins as Lost and settlements as Income
Another option is to mark the previous Celsius coins as Lost and enter the new settlement coins as Income or Income (non-taxable).
After marking the previous coins as Lost, the settlement coins need to be entered again to establish a new cost basis.
You can enter the settlement as:
Income
Income (non-taxable)
If you enter the settlement as Income, the values will appear in your income report. This may look incorrect because these are coins you previously owned.
If you enter the settlement as Income (non-taxable), the values will not appear in the income report. However, tax authorities may still have questions about this treatment.
Option 3: Keep the original coins
A third option is to treat the settlement as a Deposit instead of a replacement for Lost transactions.
In this case:
Mark the previous Celsius transactions as Withdrawal instead of Lost
Enter the settlement coins as Deposit
For example, if you previously owned ETH and BTC, you could argue that the coins were never fully lost, but were temporarily out of reach. In that case, the outgoing transaction would be recorded as a Withdrawal, and the later settlement would be entered as a Deposit.
Important:
This approach may not be correct from a tax perspective because it keeps the original cost basis and holding period of ETH and BTC. In addition, you may not have received the exact same coins back that you originally held. This could make the treatment difficult to justify to tax authorities.
Which option should I choose?
The best option depends on your specific situation, including:
How your Celsius data was previously imported
Whether you already filed a tax report
Whether Lost transactions were included in that report
How your local tax authority treats settlement payments
Whether you received the same coins or different coins
If you are unsure which option applies to your case, consult a tax adviso for personalized guidance.
Summary
Celsius settlements can be entered in CoinTracking in several ways. You can record only the net difference as Lost, mark the original coins as Lost and the settlement as Income, or keep the original coin history by using Withdrawal and Deposit entries. Each method can have different tax consequences, so the correct choice should be reviewed with a tax professional.