Digital Chamber CEO Shares Vital Insights Into IRS’ Crypto Tax Form 1099-DA

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As a seasoned crypto trader, I’ve kept a close eye on the latest developments in the regulatory landscape of digital assets. Perianne Boring, the CEO and founder of the Chamber of Digital Commerce (CDC), recently shared her insights on the IRS’ new draft of Form 1099-DA, which is expected to significantly impact the world of cryptocurrencies.

Perianne Boring, the head of Chamber of Digital Commerce (CDC), recently shared her expertise in a post on X about the IRS’ new Form 1099-DA and its implications for cryptocurrencies. Published on April 25, her post highlighted the IRS’ plan to gather more information on unhosted crypto wallets, generating significant interest among crypto traders.

Significantly, the Internal Revenue Service (IRS) in the United States has unveiled a fresh draft of a cryptocurrency tax form. This development provides clues about the direction of reporting requirements for crypto transactions. Here’s a simplified version of the new cryptocurrency tax form draft.

Form 1099-DA: A Closer Look 

Based on the April 19th draft released by the statutory body, a new version of Form 1099-DA for tax reporting has been proposed. This form is designed to make it easier to report crypto transactions, with a focus on unhosted wallets.

Before making an official declaration, the IRS is soliciting input from the public to enhance their working draft. This open communication demonstrates the agency’s unwavering dedication to enhancing the tax reporting experience for brokers and clients engaged in the digital asset marketplace.

I’ve observed that the agency has made a significant decision to regulate unhosted wallets under its jurisdiction, which means stricter Know Your Customer (KYC) procedures will be required for crypto sales and exchanges facilitated through brokers. Consequently, the IRS is strengthening its control over digital asset trading with this move. The aforementioned actions carry substantial weight in tightening the regulatory framework around cryptocurrencies.

When Will The New Regulation Kick In?

Starting January 1, 2025, I will be among the digital asset brokers across the country required to report any sales or exchanges of digital assets that take place. This group includes trading platforms, payment processors, and wallet providers specializing in digital assets. Furthermore, under certain circumstances, I will also need to facilitate reports on gains or losses, as well as relevant basis details for transactions that occur after January 1, 2026.

Digital Chamber CEO Shares Vital Insights Into IRS’ Crypto Tax Form 1099-DA

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2024-04-25 19:56