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US Introduces New Crypto Taxation Rules for 2026

Cryptodnes2024/06/30 22:49
By:Cryptodnes

Cryptocurrency platforms will soon face new reporting requirements to the US Internal Revenue Service (IRS) that will take effect in 2026.

This one stroke follows the finalization of regulations by the IRS and the U.S. Treasury Department implementing a provision of the Biden administration's Infrastructure Investment and Jobs Act of 2021.

Starting with transactions in 2025 (a year before the new requirements are introduced), crypto platforms will be required to report profits from the sale of digital assets using a standardized Form 1099, similar to those used by traditional banks and brokerage houses. This aims to streamline tax reporting for investors and strengthen oversight to combat tax evasion in the digital asset sector.

IRS Commissioner Danny Werfel emphasized the importance of these provisions in preventing the misuse of digital assets and the evasion of taxable income, highlighting their role in improving compliance in this high-risk area.

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However, these rules apply specifically to custodial platforms like Coinbase that manage client assets directly. Decentralized platforms that do not hold client assets, following lobbying efforts by the crypto industry, are exempt from these reporting requirements. Blockchain Association welcomes this release as a significant achievement that highlights industry influence and community advocacy.

Going forward, the Treasury Department and the IRS plan to address the reporting obligations of decentralized brokers through a separate set of regulations, taking into account the evolving landscape of digital asset transactions.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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