IRS hires two cryptocurrency tax experts to bolster digital asset tax enforcement and compliance
The US Internal Revenue Service (IRS) has appointed two cryptocurrency tax experts from the private sector to help lead the agency's efforts in establishing a service, reporting, compliance, and enforcement program focused on digital assets. The official US tax filing season began on January 29th, and since then the IRS has issued multiple notices urging citizens to report their income from cryptocurrency and digital assets, including NFTs.
IRS lists 4 crypto-related cases as priority cases for 2023
According to a report by Cointlegraph on December 13th, the Criminal Investigation Department of the US Internal Revenue Service (IRS) has listed four cases related to cryptocurrency as one of the top ten "most prominent and noteworthy investigations" for 2023. These cases include investigations into the Silk Road market, OneCoin, Oyster Protocol founder "Bruno Block," and a money laundering scheme using Bitcoin self-service terminals.
FTX says IRS demand for $24 billion in unpaid taxes is delaying recovery of user funds
On December 12th, FTX's lawyers stated in new documents submitted to the Delaware bankruptcy court that the US Internal Revenue Service (IRS) should verify its claim against FTX and explain how it calculated the alleged unpaid taxes. This is the latest step in the months-long dispute between the IRS and FTX's bankruptcy assets, with the focus of the controversy being how much this bankrupt trading platform and its affiliated companies owe the government in unpaid taxes.
IRS proposes new rules for reporting digital asset sales and exchanges by brokers
The IRS has released proposed regulations for the sale and exchange of digital assets by brokers. The rules would require brokers to use a new form to simplify tax filing and cut down on tax cheating. The regulations aim to bring digital asset reporting in line with reporting on other types of assets and are part of the Biden administration's implementation of the Infrastructure Investment and Jobs Act. The proposed rules would go into effect in 2026 and comments on the proposal are being accepted until Oct. 30.
Crypto Staking Rewards Classified as Taxable Income by IRS: What You Need to Know
The IRS has ruled that crypto staking rewards are now taxable in the United States, with the agency categorizing them as gross income. The ruling, outlined in the Revenue Ruling of 2023-14, states that stakers must pay taxes on rewards when they have control over them. This could complicate tax filings for cryptocurrency users who often stake on multiple networks. The IRS has faced legal challenges over its taxation of staked crypto, and is also seeking information on users from the Kraken crypto exchange.
IRS Rules Rewards Earned from Staking Cryptocurrency Must be Included in Taxpayer's Gross Income
The IRS has confirmed that rewards earned from staking cryptocurrency are taxable in the year they are received, according to a recent ruling. This decision aligns with the IRS's stance since the Jarrett case, which argued that staking rewards should not be taxed until they are sold. However, the IRS maintains that staking income represents a realized accession to wealth that the taxpayer has complete control over, and therefore must be included in gross income.
US IRS Seeks Crypto Industry’s Help To Improve Tax Compliance
The US Internal Revenue Service (IRS) is seeking assistance from the cryptocurrency industry to improve tax compliance. The IRS's Digital Asset Initiative Project Office (DAIPO) has issued a Source Sought Notice, requesting solution and product ideas from industry partners to enhance the agency's pricing and market data capabilities.
Kraken Ordered to Hand Over Trading Information to IRS in Cryptocurrency Tax Investigation
July 4 (Cointime) - Kraken, a US-based cryptocurrency exchange, has been ordered by a federal judge to hand over trading information of users who have made transactions worth $20,000 or more to the Internal Revenue Service (IRS). The IRS is investigating US taxpayers who have used cryptocurrency to ensure they have complied with internal revenue laws.
Democrats Push for Crypto Tax-Loss Harvesting Clause After Republicans Block Provision in Debt Ceiling Bill
Democrats are continuing to push for a tax-loss harvesting clause aimed at the crypto industry, despite it being removed from the recently-passed debt ceiling bill after being blocked by Republicans. The clause aimed to stop wash trading in crypto, which is currently exempt from the wash sale rule as the IRS does not treat crypto as a security.
Judge Upholds IRS Authority Over Coinbase User Data
The judiciary has ruled in favor of the Internal Revenue Service (IRS) in a case involving the procurement of personal data from cryptocurrency exchange Coinbase. The decision highlights the broad powers of the IRS in enforcing tax compliance, and the limited privacy rights of crypto users. The case involved a decade-long legal battle between the IRS and a Coinbase user, who argued that his privacy rights were violated. However, the judge dismissed his objections and affirmed the IRS's authority to obtain personal data through a summons. Coinbase also reports certain cryptocurrency transactions to the IRS for tax purposes.
