The entry into force of the “Infrastructure Jobs and Investment Act” on January 1 has marked a significant milestone in the world of crypto in the United States.
Under this new legislation, any individual who receives $10,000 or more in cryptocurrency during their business activities is subject to reporting such transactions to the Internal Revenue Service (IRS).
New crypto tax reporting obligations took effect on Jan 1.
If you receive $10k or more in crypto you now have an obligation to report the transaction (including names, addresses, SS numbers, etc.) to the IRS within 15 days under threat of a felony charge. pic.twitter.com/wyRsfJEpMo
— Jerry Brito (@jerrybrito) January 2, 2024
This measure, contained in The Infrastructure Investment and Jobs Act, is considered self-executing, which implies that it does not require additional regulatory actions for its implementation.
Since its approval in November 2021, it has become operational since the first day of this year, establishing a clear limit for cryptocurrency transactions that must be reported to the IRS.
However, the application of this law has not been without challenges and controversies for crypto
Organizations such as Coin Center have questioned the constitutionality of this measure and have filed lawsuits against the Treasury Department, arguing the lack of clarity and guidance on how to comply with these new tax obligations.
The lack of precise guidelines has led to confusion among cryptocurrency users, especially in specific scenarios such as mining rewards, decentralized transactions, and the absence of guidelines for properly reporting such operations to the IRS.
Additionally, it raises key unanswered questions: How should miners or validators report block rewards greater than $10,000? Who to report to in the case of decentralized crypto-to-crypto transactions? These loopholes have left users in a state of uncertainty about how to comply with the law effectively.
To date, the IRS has not provided guidance or updated the forms necessary to comply with these new regulations, leading to a situation where many users may attempt to comply with the law informally, without the necessary official guidance.
