How to Mark a Transaction as a Transfer and Manually Link Transactions

There are several reasons a user may need to manually change a transaction from a disposition to a transfer. This document will explain both scenarios.

Scenario #1 - Transfer Status - Mark this transaction as a transfer.
Scenario #2 - Manually Link Transfer - Include this transaction as part of a transfer

Scenario #1 - Transfer Status - Mark this transaction as a transfer.
An outgoing or “Sent” transaction from a user-controlled wallet that is visible by NODE40 Balance to a user-controlled wallet not visible by NODE40.

Example: If digital currency is sent via the blockchain from an exchange like Coinbase, to a wallet, chain or platform not currently supported by NODE40 such as Cardano, NODE40 will display the outgoing transaction in your ledger, but because it does not detect that it is a wallet controlled by you/the user, it will treat this transaction as a disposition.

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If you would like to tell NODE40 Balance that this transaction should be a transfer, you may mark this as such by expanding the transaction, navigating to the “Advanced Transaction Options” and clicking “Mark as Transfer”. Marking this transaction as a transfer will defer any gain or loss until a later disposition.

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Once the recalculation process finishes, a “Sourceless” ledger will be created, representing the side of the transaction that NODE40 does not have visibility of (in the example above, it would be representing your Cardano Wallet that is not present on NODE40)

Scenario #2 - Manually Link Transfer - Include this transaction as part of a transfer

Our SMART Algorithm (Simple Multi-Account Reconciliation Technology) is a revolutionary process designed to match and follow cost basis and other data for cryptocurrency transactions. SMART automatically links related transactions as digital assets move across wallets and in and out of platforms in which a client has interacted.

However, there are cases where automatic linking may not be possible due to transaction complexity or inconsistent dates reported from a source.

NODE40 now provides users the ability to manually link such transaction parts together.

Here’s how it works:

1. Identify Unlinked Transactions: When the SMART algorithm cannot automatically link transactions, the user may identify unlinked entries in their transaction history. Unlinked transactions show as dispositions that should instead be treated as transfers.
   
   

2. Create the Manual Link:

   • Users can review unlinked transactions and manually associate them using our new manual linking feature as shown in the graphic below. (For example, if a token moved from an exchange with an API connection to an exchange with transactions that were manually added to a user’s portfolio in NODE40, the transactions can now be manually linked.)

     • Expand the transaction, navigate to the “Advanced Transaction Options” and click on the blue “Add to Transfer” button to Manually Link Transfer and Include this transaction as part of a transfer.

     • Once that button is clicked, a pop-out from the bottom of the screen will appear quickly and then minimize to show the symbol below with a red “1” bubble. This is indicating there is one transaction set-aside to be linked.
       
       

After you have the first side of the transaction marked, locate the other side of the transaction that you would like to link, and click the blue “+” sign as shown below.

• Once both transactions are selected that you would like to link together, click the blue “link transfers” button.

Enhanced Accuracy: Manual linking enhances the overall accuracy of tax reporting and financial analysis, especially when dealing with complex crypto portfolios. By offering more control over which transactions are linked, NODE40 ensures that users have the flexibility to override more automated behavior and puts the control back where it belongs, with users.

Remember, while the SMART algorithm automates most of the work, NODE40’s commitment to accuracy includes enabling users to intervene when needed. This combination of automation and user control ensures a comprehensive and reliable solution for managing important crypto data.