Us Legislators Ask IRS To Come Up With Comprehensive Guidelines For Cryptocurrencies

A number of legislators in the United States are requesting the IRS (Internal Revenue Service) to come up with new guidelines on how taxpayers will be filling the gains they make from investing in Crypto tokens.

IRS Failure To Provide Comprehensive Guidelines

According to a letter which was published in the House Ways and Means Committee website, some house representatives are urging the IRS to come up with comprehensive guidelines with respect to profits made from either trading in Cryptocurrencies or any other means associated in digital coins. The representatives involved in this push include David Schweikert (R-AZ), Brad Wenstrup (R-OH), Kevin Brady (R-TX), Lynn Johnson (R-KS), and Darin LaHood (R-IL).

The legislators who are mainly republican had issued the IRS with a letter voicing their concerns on the IRS deciding to boost the enforcement of violations related to the crypto sector while failing to come up with a strategy that would make it possible for taxpayers to better maneuver and adhere to the current regulatory codes that are in place.

In their latest letter, the representatives are criticizing the agency for not addressing the previously stated concerns saying that even though they sent the initial letter over a year ago, the IRS has continued to boost its enforcement efforts without providing a more comprehensive guideline to the taxpayers. They went on to say that the latest letter was to urge the agency to take into consideration the taxpayers who want to not only understand but also comply with their set regulations when it comes to Crypto assets.

Current Guidelines Outdated

The legislators have faulted the agency for repeatedly going after those in the Crypto sector it deems to be evading tax while at the same time refusing to offer comprehensive guidelines and safe haven for taxpayers who are genuinely looking to report their Crypto related gains. The agency latest target has been Coinbase, the Crypto exchange. The IRS is looking to obtain a record of the exchange’s customer transactions.

The letter stated that even though the IRS has only issued preliminary guidelines when it comes to Crypto assets, it has been very aggressive in its enforcement of the said guidelines even making massive efforts on various fronts with regards to the enforcement. They added that in the same breath the IRS has refused to offer any leniency to the taxpayers saying that they have provided for a disclosure program which taxpayers can use to voluntarily speak on Crypto related tax non-compliance.

The guidelines that the IRS is currently using were drafted back in 2004, when Bitcoin was valued at half the price it is currently trading for and most of the newer digital coins had not even been invented. These guidelines had Crypto assets classed as properties when reporting which means that any profits made during disposing of the coins, a taxpayer is expected to pay for capital gains.

The Deadline

The legislators finished the letter off by stating that they would be giving the agency up to the 17th of October to furnish the Ways and Means Committee with its plans for the drafting of more robust guidelines for the Crypto sector as well as when they will be publishing the regulations.