IRS Advisory Committee Requests Clearer Guidance for Crypto Tax Code

IRS Advisory Committee Requests Clearer Guidance for Crypto Tax Code 1

On October 24, 2018, an advisory committee to the Internal Revenue Service (IRS) published a report calling for clarity on the IRS’s position toward cryptocurrency taxation.

The Information Reporting Program Advisory Committee (IRPAC) recently released its annual report advising the IRS on possible areas to improve the tax code, specifically referring to data gathered throughout the fiscal year of 2018.

In this 95-page report, multiple sections are dedicated to the issue of cryptocurrency taxation, with the IRPAC specifically recommending “that the IRS issue further guidance on the information reporting and withholding implications of cryptocurrency transactions.”

Cryptocurrency tax policy has been a headache for investors, as the IRS regards each trade as a taxable event akin to realizing gains on an investment. Perhaps due to the abstruse nature of the tax code and the inherent complexities that come with reporting each trade, few investors reported their gains for the 2017 tax year.

In the report’s overhead, the IRPAC specifically credits the IRS’s Notice 2014-21 for acknowledging that virtual currency is still treated as property in the eyes of the federal government’s capacity to levy taxes.

Nevertheless, the report claims that the rise of cryptocurrency has raised further questions about the tax regulations around the nascent asset class, including whether or not cryptocurrency is a specified foreign financial asset or if crypto transactions must follow the guidelines of broker reporting.

The report cites research from Fundstrat Global Advisors in April, which estimates that there are $25 billion in tax liabilities within the United States. The report goes on to state that “because transactions in virtual currencies can be difficult to trace and have an inherently pseudonymous aspect, some taxpayers may be tempted to hide taxable income from the IRS.”

Needless to say, such a large potential source of taxable income would be of great interest to the IRS, and the report goes on to detail several “general tax principles” that apply to property transactions, stating that these would logically apply to crypto asset transactions as well.

The report concludes the cryptocurrency section by referencing the court’s attempts to enforce a summons on Coinbase, and how this could form a useful precedent for dealing with crypto asset holders that wish to avoid federal tax agents, stating that “IRPAC would be very interested in helping develop information reporting and withholding guidance on these important issues.”

IRS Advisory Committee Requests Clearer Guidance for Crypto Tax Code 2
About the author

E-Crypto News was developed to assist all cryptocurrency investors in developing profitable cryptocurrency portfolios through the provision of timely and much-needed information. Investments in cryptocurrency require a level of detail, sensitivity, and accuracy that isn’t required in any other market and as such, we’ve developed our databases to help fill in information gaps.

Related Posts

E-Crypto News Executive Interviews



bitcoin
Bitcoin (BTC) $ 42,212.00
ethereum
Ethereum (ETH) $ 2,861.83
cardano
Cardano (ADA) $ 2.24
tether
Tether (USDT) $ 1.00
binance-coin
Binance Coin (BNB) $ 341.26
xrp
XRP (XRP) $ 0.922892
solana
Solana (SOL) $ 130.56
usd-coin
USD Coin (USDC) $ 1.00
polkadot
Polkadot (DOT) $ 28.83
dogecoin
Dogecoin (DOGE) $ 0.205658
USD
EUR
GBP
bitcoinBitcoin (BTC)
$ 42,212.00
ethereumEthereum (ETH)
$ 2,861.83
tetherTether (USDT)
$ 1.00
bitcoin-cashBitcoin Cash (BCH)
$ 507.47
litecoinLitecoin (LTC)
$ 148.02
bitcoinBitcoin (BTC)
35.963,36
ethereumEthereum (ETH)
2.438,19
tetherTether (USDT)
0,851970
bitcoin-cashBitcoin Cash (BCH)
432,35
litecoinLitecoin (LTC)
126,11
bitcoinBitcoin (BTC)
30,801.46
ethereumEthereum (ETH)
2,088.23
tetherTether (USDT)
0.729685
bitcoin-cashBitcoin Cash (BCH)
370.29
litecoinLitecoin (LTC)
108.01

Automated trading with HaasBot Crypto Trading Bots

Crypto Scams

Crypto Scams
Crypto Scams Still Persistent In 2021, SEC Warns About Red Flags To Watch
September 9, 2021
Poly Network
Here’s How Hackers Stole Over $600 million in the Poly Network Attack
August 12, 2021
The World’s Most Infamous Crypto Hacks and Scams
July 31, 2021
Cryptocurrency Exchanges
Cryptocurrency Exchanges and the Plague of Scams and Bans
June 29, 2021
What Role Do Cryptocurrencies Play In The Era Of Ransomware Attacks?
June 9, 2021

Blockchain/Cryptocurrency Questions and Answers

Beginner’s Guide to Investing in Cryptocurrency
August 9, 2021
Short-Sell Cryptocurrency
How to Short-Sell Cryptocurrency: A Brief Overview
July 17, 2021
Klaytn
What Is Klaytn (KLAY) And How Does It Work?
July 16, 2021
Cryptocurrencies
Our Crypto Roundup Interview Asks- Do Cryptocurrencies Have a Future?
July 15, 2021
Solana
What Is Solana (SOL) And How Does It Work?
June 26, 2021


CryptoCurrencyUSDChange 1hChange 24hChange 7d
Bitcoin42,054 0.85 % 1.99 % 12.87 %
Ethereum2,837.9 1.39 % 3.69 % 17.20 %
Cardano2.230 1.43 % 6.03 % 5.97 %
Tether0.9986 0.03 % 0.08 % 0.23 %
Binance Coin339.78 0.98 % 5.72 % 17.43 %
XRP0.9184 1.04 % 3.68 % 14.63 %
Solana130.21 1.00 % 8.20 % 23.46 %
USD Coin1.000 0.02 % 0.02 % 0.10 %
Polkadot30.87 2.19 % 17.29 % 10.73 %
Dogecoin0.2048 0.74 % 3.72 % 15.34 %

bitcoin
Bitcoin (BTC) $ 42,212.00
ethereum
Ethereum (ETH) $ 2,861.83
cardano
Cardano (ADA) $ 2.24
tether
Tether (USDT) $ 1.00
binance-coin
Binance Coin (BNB) $ 341.26
xrp
XRP (XRP) $ 0.922892
solana
Solana (SOL) $ 130.56
usd-coin
USD Coin (USDC) $ 1.00
polkadot
Polkadot (DOT) $ 28.83
dogecoin
Dogecoin (DOGE) $ 0.205658