U.S. Lawmakers Urge IRS To Update Cryptocurrency Tax Guidance

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U.S. Lawmakers Urge IRS To Update Cryptocurrency Tax Guidance

Posted on September 20th, 2018 in Government Regulation by Ryan Warner

Some U.S. lawmakers are calling on the Internal Revenue Service to release guidance for taxpayers earning gains or transactions involving cryptocurrency.

Representatives Kevin Brady, Lynn Jenkins, David Schweikert, Darin LaHood and Brad Wenstrup sent an open letter to IRS commissioner David Kautter saying the agency had "more than adequate" to develop clear rules on how cryptocurrency products should be taxed.

The letter claims that rather than focusing on clear taxing rules the IRS has instead maintained it's focus on preliminary enforcement action rules released in 2014. The letter also cited examples such as the IRS effort to collect earnings data on Coinbase users and referenced a letter sent in 2017.

"We therefore write again today to strongly urge the IRS to issue updated guidance, providing additional clarity for taxpayers seeking to better understand and comply with their tax obligations when using virtual currencies."

The lawmakers also added:

"We are concerned that the IRS is seeking to enforce guidance that does not adequately advise taxpayers of their tax obligations when using virtual currencies."

These lawmakers also argue that a lack of guidance "severly hinders," the ability of taxpayers to comply with tax obligations.

The Government Accountability Office will also be asked by the House Committee on Ways and Means to conduct an audit on the matter.