The IRS released over 280 pages of proposed regulations intended to implement the congressional mandate that the broker reporting rules apply to those who facilitate the transfer of digital assets such as Bitcoin and other cryptocurrency.
When these rules take effect, they will impose substantial new tax reporting obligations on digital asset trading platforms, payment processors, and wallet providers.
How We Got Here
Brokers have long been required to file IRS Form 1099-B, Proceeds from Broker and Barter Exchange Transactions, for each person for whom they sell stocks, bonds, commodities, debt instruments, options, securities futures contracts, commercial paper, and almost any other type of investment.
The broker must report such details as the sales proceeds, the sale and purchase dates, the tax basis for the sale, and whether the gains or losses were long-term or short-term. These reporting requirements make it very difficult for taxpayers with such investments to hide their sales and any gains from the IRS.
Back in 2021, when Congress passed the Infrastructure Investment and ... Log in to view full article.
