Lawmakers Pen Letter Urging IRS to Clarify Crypto Guidance

 

 

 

 

 

A bipartisan group of U.S. lawmakers have drafted a letter to IRS Commissioner Charles P. Rettig, urging his agency to issue more detailed tax and reporting guidance for taxpayers who use digital currencies. The letter’s 21 co-signers included the co-chairs of the Congressional Blockchain Caucus.

In the letter, the lawmakers noted that it has been almost five years since the IRS released its preliminary guidance on cryptocurrency, and more than two years since the agency’s Inspector General determined that guidance to be insufficiently clear. The IRS publicly agreed with the IG’s recommendation that the agency needed to provide updated guidance on documentation and tax treatment of crypto but failed to follow up with real action.

The legislators have asked the IRS to prioritize guidance for three main areas of concern, including “acceptable methods for calculating the cost basis” and “acceptable methods of cost basis assignment and lot relief” for cryptocurrencies, as well as tax treatment for cryptocurrency forks.

While acknowledging that there are additional issues related to federal crypto taxation, the group suggested that those tax calculation and transaction tracking questions urgently needed to be resolved”

“There are many other open questions about the federal taxation of virtual currencies, but we feel that there is a particular urgency in resolving the ambiguity around basic questions of how taxpayers should calculate and track the basis of their virtual currency holdings.

It is not reasonable to expect taxpayers to satisfactorily answer these complex questions while the IRS remains silent.”

Minnesota Congressman and Congressional Blockchain Caucus co-chair Tom Emmer stressed the issue's importance in a press release on his congressional website:

"Guidance is long overdue and essential to proper reporting of these emerging assets. The bipartisan support this letter has received should send a clear message to the IRS that clear guidelines for reporting virtual currency are necessary. My colleagues and I are optimistic that the IRS will issue the guidance needed for taxpayers struggling with these reporting requirements." 

Author: Ken Chase

Freelance writer whose interests include topics ranging from technology and finance to politics, fitness, and all things canine. Aspiring polymath, semi-professional skeptic, and passionate advocate for the judicious use of the Oxford comma.

Share This Post On

Submit a Comment

Your email address will not be published. Required fields are marked *

  Subscribe To Newsletter
Subscribe to Our Newsletter

Keep up to date with the latest from DCEBrief

* we hate spam and never share your details.
×