The tax authority isn’t going to force crypto users to comply with a new $10K rule
The Internal Revenue Service (IRS) announced on January 16 that US businesses aren’t yet required to report cryptocurrency transactions exceeding $10,000 until the agency completes its regulatory framework. The decision comes after the US Treasury Department and the IRS revised the Infrastructure Investment and Jobs Act (IIJ).
A new law that took effect on January 1 requires all US businesses to report cryptocurrency transactions above $10,000, but the IRS has decided not to enforce the rule currently.
IRS states 6050I–a problematic provision of the infrastructure bill requiring reporting digital asset transactions over $10K–isn't effective until there's more rulemaking. A positive step forward given its impossibility and breadth of reporting required.https://t.co/x8SFAQfuEh
— Blockchain Association (@BlockchainAssn) January 16, 2024
“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.”
Crypto users aren’t happy about the new rules. Jerry Brito, executive director of Coin Center, remarked that many would “find it difficult to comply” with the reporting conditions without additional direction from the IRS.
The IIJ Act mandates that taxpayers report acquiring more than $10,000 cash within 15 days. Digital Assets were deemed as cash under Section 6050I of the Act, but US cryptocurrency users won’t be affected for now.
The IRS and the Treasury plan to issue the proposed digital asset reporting rules but don’t specify when that would happen. They will also permit the public to give remarks on how the new rules should be created.
The Blockchain Association says the news is a “positive step forward,” considering the problems with cryptocurrency transaction reporting.
The US House Financial Services Committee also endorsed the “stopgap action” but highlighted several underlying issues with the “poorly constructed digital asset reporting requirements” enacted on January 1.
