U.S. Internal Revenue Service (IRS) Says New Crypto Taxation Guidance Coming “Soon”
The U.S. Internal Revenue Service (IRS) is finalizing its work on the release of the first cryptocurrency tax guidance since 2014.
The development that the agency is ready to launch such a framework comes to the fore after an IRS commissioner responded to a lawmaker’s queries on the subject.
According to IRS Commissioner Charles P. Rettig, the agency will act “soon.” Rettig was responding to Rep. Tom Emmer’s earlier request for more clarification and other such additional guidance on the issue of reporting cryptocurrencies.
The IRS commissioner said that the public will have access to clear guidance on the aspect of crypto tax reporting before long.
Writing in response to the Congressional Blockchain Caucus, Rettig noted that he too believed that providing clarification was important. He said that “taxpayers deserve clarity on basic issues” that relate to how tax regulations apply to virtual currency transactions.
He added that the IRS’ main concern at the moment is to issue guidance on the subject.
The letter confirms that the IRS is preparing the guidelines that will provide clarity with regard to “acceptable methods” in the calculation of things like cost basis and cost basis assignment.
According to him, the agency had considered all these issues and would publish the necessary guidance to cover such aspects as the tax treatment of virtual currencies from forks.
Rep. Emmer released a statement acknowledging Rettig’s response and noted that it was encouraging to hear that the IRS had initiated plans to have the guidance issued.
Like Rettig, Emmer agreed that taxpayers deserve to get clear answers to several basic questions that touch on the federal government’s taxation of “emerging exchanges of value.”
He added that he looked forward to the proposal and would seek to work with the IRS to serve U.S. taxpayers.
The Congressional Blockchain Caucus, for which Rep. Emmer is a member, comprises U.S. lawmakers who have teamed up to help anchor reporting and legal requirements as connected to cryptocurrencies.
In his earlier request, Rep. Emmer had asked the IRS to come up with guidance that would clarify the obligations of a taxpayer who has virtual currencies.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.