News
US Treasury issues new cryptocurrency tax rules
- The IRS has developed a regulatory framework for cryptocurrency brokers to report for tax purposes, which will be implemented in 2025.
- The framework does not include decentralized finance and unhosted wallets, although rules for the latter will come later in the year.
Under the new framework, cryptocurrency brokers, hosted wallet services, and digital asset outlets must file 1099 tax forms to document earnings from their users’ digital assets. These assets will include coins, tokens, NFTs, and stablecoin transactions above a certain threshold.
The new regime does not yet include tax reporting processes for income and profits from decentralized finance activities or unhosted wallets, as it is focused on large, centralized firms. However, DeFi regulations are said to be coming later in the year and will come into force alongside the rest of the regulatory framework in January 2025.
The regime states that users who earn less than $10,000 in stablecoins in a year are exempt from reporting. Additionally, cryptocurrency brokers can report stablecoin sales in aggregate, although they must report sophisticated and high-volume individual sales separately.
For NFTs, users are exempt from reporting NFT sales proceeds under $600 in a financial year.
Starting in 2026, cryptocurrency brokers will be required to maintain a basic cost record for all assets, including the prices at which users purchase their assets. Real estate transactions settled with cryptocurrency will also be reported using the fair market value of the digital assets used.