IRS and Treasury grant temporary exemption from cryptocurrency reporting obligations for businesses
The Internal Revenue Service (IRS) and the U.S. Treasury Department have announced that American businesses are not required to report cryptocurrency receipts in the same way as cash, until new regulations are issued. The exception will remain in place until the IRS and Treasury issue the new regulations. However, this announcement does not affect the existing rules for reporting cash received in the course of a trade or business, which still need to be reported on Form 8300 if the cash transaction exceeds $10,000 within 15 days of receipt.
The IRS proposed new regulations in September 2023, with a focus on information reporting for specific crypto sales and exchanges. The aim of these regulations is to expand the current reporting requirements to include crypto transactions. Under the proposed regulations, brokers would have new responsibilities, such as submitting information returns and providing payee statements for designated crypto dispositions on behalf of their customers. This would require the introduction of a new IRS form.
The regulations are expected to come into effect in 2026, applicable to transactions in 2025. Specific provisions are set to be effective in 2027 for transactions occurring in 2026. However, blockchain firm Consensys has expressed concerns about the proposed regulations, stating that if finalized as is, they would impose a “new and complex regulatory scheme on software developers and others in a fast-growing industry with unique technical and operational features.”
In other news, the IRS has revealed that nearly 50% of crypto investigations in 2022 were related to tax issues. The agency has listed four crypto crimes as the top frauds of 2023. To stay updated on the latest news, follow us on Google News.
