IRS says controversial $10k reporting rule doesn't currently apply to crypto
Advertising
Two U.S. agencies announced on Jan. 16 that controversial transaction reporting rules do not apply to digital assets (ie. cryptocurrency).
The Internal Revenue Service (IRS) and Department of the Treasury said:
“Businesses … do not have to report the receipt of digital assets the same way as they must report the receipt of cash until Treasury and IRS issue regulations.”
In an attached announcement, the IRS and Treasury said:
“This announcement provides transitional guidance … and clarifies that at this time, digital assets are not required to be included when determining whether cash received in a single transaction (or two or more related transactions) meets the reporting threshold.”
The two agencies said that they intend to issue proposed regulations applying to the receipt of digital assets at a later date. This will allow the public to submit comments in writing and at a public hearing if requested.
Earlier uncertainty around $10K reporting rule
The rule requires businesses to report on Form 8300 that they have received more than $10,000 in cash within 15 days of receipt.
At present, the text of the rule only mentions cash and does not explicitly mention digital assets. However, a particular law — the Infrastructure Investment and Jobs Act — was previously updated to consider digital assets as cash.
The IRS and Treasury acknowledged that change but said that the provision requires issuing new guidance before the change takes effect.
The rule previously attracted complaints, particularly from industry group CoinCenter. CoinCenter asserted that the rules began to apply to crypto transactions in early January. It also expressed concerns that the requirements could apply to entities that are not capable of compliance, such as blockchain miners, validators, and decentralized exchange users.
CoinCenter also challenged the rules in court. However, because that lawsuit has not progressed since mid-2023 and was not acknowledged by either agency today, the case seemingly did not prompt the agencies’ latest announcement.
The postponed rules only concern extra reporting requirements that apply to large transactions. General income tax rules still apply, requiring U.S. crypto investors and transactors to report gains and losses on digital assets.
The post IRS says controversial $10k reporting rule doesn’t currently apply to crypto appeared first on CryptoSlate.
