In this tutorial, we will go over the popular set up for automating the classification of NFT royalties. This classification rule automates the classification of NFT Royalty income transactions in your ledger.

Step 1

Before creating a classification rule for automatically tracking your NFT royalties, you need to have a classification created first for NFT royalty income in Chart of Accounts. After this is done, head to the Automation tab.

Step 2

On the Automation tab, click on the blue +Classification Automation

Step 3

If you are receiving NFT royalties income into a wallet, select the Connection Rule Source and click Next.

Step 4

Add a rule name, description (optional), and rule category.

In the rule category, since your NFT royalty income is coming into your wallet, you should select "Wallets" as your rule category.

You will notice a new button appears asking for the wallet source, click it to choose your wallet.

Step 5

Choose your NFT royalty income wallet then click on the "Go Back" button for the next step.

Step 6

Click on the blue "Next" button and you will be on the rule criteria step. In this step, you can add any criteria for classifying transactions automatically, in this case automatically tracking NFT royalties.

Step 7

There are two criteria options you can use for tracking NFT royalties automatically. The first one is by the transaction type for RECEIVE events (every income transaction would be a RECEIVE event). The second criteria would be to track the contract address of the NFT. The smart contract of the NFT collection is automatically issuing the royalty payouts, this contract address can be tracked.

Set up your transaction type RECEIVE criteria.

Step 8

Set up your contract address criteria.

Make sure to add your NFT smart contract address below.

Step 9

Link your classification rule to the classification you want the rule to use. In this case, the NFT royalty classification rule will apply to the NFT royalty classification.

Review and confirm the classification rule, this will only affect future NFT royalty income transactions.

Step 10

Apply your NFT royalties income classification to past transactions. Click on view, apply, then confirm.

Your NFT royalty income transactions from the past should all automatically be classified and all future NFT royalty income transactions will automatically be classified as well.