K&L Gates Discusses Tax-Free Cryptocurrency Transactions and Reporting Obligations

As cryptocurrencies such as Bitcoin and Ethereum become more prevalent in investment circles
and acceptable for commercial transactions, the United States Internal Revenue Service (“IRS”)
has said little other than to label “virtual currencies” as property and state that transactions
involving virtual currencies may be subject to taxation under generally applicable law. 1
However, on September 7, the United States Congressional Blockchain Caucus 2 (the “Caucus”)
introduced the Cryptocurrency Tax Fairness Act (the “Act”), which would exempt certain
cryptocurrency transactions and create a cryptocurrency-specific information reporting
requirement.

The Cryptocurrency Tax Fairness Act

Under the Act, gross income would not include … Read more

K&L Gates Discusses Tax-Free Cryptocurrency Transactions and Reporting Rules

As cryptocurrencies such as Bitcoin and Ethereum become more prevalent in investment circles and acceptable for commercial transactions, the United States Internal Revenue Service (“IRS”) has said little other than to label “virtual currencies” as property and state that transactions involving virtual currencies may be subject to taxation under generally applicable law.[1] However, on September 7, the United States Congressional Blockchain Caucus[2] (the “Caucus”) introduced the Cryptocurrency Tax Fairness Act (the “Act”), which would exempt certain cryptocurrency transactions and create a cryptocurrency-specific information reporting requirement.

The Cryptocurrency Tax Fairness Act

Under the … Read more