27 Aug 2024
Can that Be True? Learn More about the Reporting and Taxation of Digital Assets
For U.S. tax purposes, digital assets are considered property, not currency. A digital asset is stored electronically and can be bought, sold, owned, transferred, or traded. The tax definition of a digital asset is any digital representation of value recorded on a cryptographically secured, distributed ledger (blockchain) or similar technology, like convertible virtual currencies and cryptocurrencies such as Bitcoin, Stablecoins, and non-fungible tokens (NFTs). In July, IRS and Treasury issued final regulations on broker digital assets information reporting. Read this KPMG report to learn more.
Related Content
- Tax and Accounting Aspects of Virtual Currency
Learn about the reporting of virtual currency. A payment using a virtual currency is subject to information reporting to the same extent and in the same manner as any other payment in property. As an example, a person who, in the course of a trade or business activity, makes a payment of fixed and determinable income, using a virtual currency with a value of $600 or more, to a U.S. nonexempt recipient in a taxable year, must report that payment to the IRS and to the payee.
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- Business Entities. IRS and Treasury issue proposed regulations addressing certain issues arising under the dual consolidated loss rules, including the effect of intercompany transactions and items arising from stock ownership in calculating a dual consolidated loss. Rules Regarding Dual Consolidated Losses and the Treatment of Certain Disregarded Payments, 89 Fed. Reg. 64750 (Aug. 7, 2024).
- Business Entities. IRS and Treasury correct a notice of proposed rulemaking (REG-133850-13) published in the Federal Register on May 15, 2024, containing proposed regulations that would remove the associated property rule and similar rules from the existing regulations on the interest capitalization requirements for improvements to designated property. Interest Capitalization Requirements for Improvements to Designated Property, 89 Fed. Reg. 59864 (July 24, 2024).
- Excise Taxes and Credits. IRS and Treasury issue final regulations providing guidance regarding the reporting and payment of the excise tax on repurchases of corporate stock made after December 31, 2022. The regulations affect certain publicly traded corporations that repurchase their stock or whose stock is acquired by certain specified affiliates. 89 Fed. Reg. 55045 (July 3, 2024).
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