Internal Revenue Service To Release Updated Crypto Tax Guidance In The ‘Coming Weeks’br>
The United States Internal Revenue Service (IRS) will be releasing its updated tax guidance for cryptocurrency in the coming weeks.
The Wall Street Journal reported that the IRS is expected to update its IRS Notice 2014-12, which stated that cryptocurrency is treated as property and existing tax principles applicable to property transactions apply to crypto transactions. The upcoming update to the 2014 guidance follows an April request from a bipartisan group of 21 Members of Congress, led by Rep. Tom Emmer.
The group urged the agency “to issue needed guidance on the tax consequences and basic reporting requirements for taxpayers that use virtual currencies” in the United States. According to the report, the US Congress is considering to pass a minimum of three bills that would focus on clarifying legal issues associated with cryptocurrencies.
Earlier this year, Rep. Emmer said that taxpayers deserve clarity on several basic questions regarding federal taxation of cryptocurrencies, adding that he was looking forward to seeing the agency’s forthcoming proposal, and working together to serve the American taxpayers.
The news came after the IRS announced that the agency will start auditing taxpayers who own cryptocurrencies. The IRS has reportedly identified a number of US citizens who have failed to report their income from crypto transactions or underreported such income, and is preparing to send out notices to taxpayers that have been identified.