The Internal Revenue Service (IRS) alerted American taxpayers about the approaching deadline to declare transactions with digital assets, including cryptocurrencies, non-fungible tokens (NFT) and stablecoins. These assets are subject to payment of taxes, and it is time to know more about it so that you do not have complications with the federal tax agency.
The deadline, in less than 10 days, applies to those who operated during the last fiscal year. The entity remembers that these assets are treated as financial assets, similar to shares or property, not as traditional currencies.
Repeal of regulations on DeFi brokers: end to a long tax controversy
The controversial DeFi broker rule, implemented during the Biden administration, was officially withdrawn. This required decentralized platforms to report gross revenue and user data, which generated criticism for hindering innovation in the sector. Its elimination frees participants from specific reporting obligations, although it maintains the need to report profits or losses on individual transactions.
With the imminent expiration, the IRS urges reviewing all digital asset operations carried out in 2023. This includes sales, exchanges, payments, and mining. Failure to do so could result in fines or audits. The entity emphasizes that, although the DeFi standard no longer applies, the responsibility for reporting falls directly on taxpayers, not on intermediaries.
Taxable digital assets: The IRS explains what you need to know
Any transaction with cryptocurrencies, such as Bitcoin, Ethereum or emerging projects such as Pi Network, must be declared. Even non-profit operations, such as transfers between own wallets, require registration. The IRS uses advanced blockchain tracking tools to identify inconsistencies, so accuracy on forms is crucial to avoiding penalties.
The 2023 tax returns incorporate specific questions about digital assets in forms 1040, 1040-SR and 1040-NR. These are located at the beginning of the documents and require a mandatory response (“yes” or “no”), regardless of whether there was activity. Experts recommend keeping detailed records of transactions, including dates, amounts and counterparties, to support the information submitted.
Platforms like CoinTracker or Koinly offer automated services to consolidate transactions on exchanges and wallets. However, the IRS suggests manually validating the data, especially in operations with DeFi or NFTs, due to its complexity. Tax advisors specialized in cryptoassets are another option to ensure error-free regulatory compliance.
Fines can be thousands of dollars if you do not declare your digital assets
The IRS has increased its focus on the sector through partnerships with technology companies and automated audits. Those who fail to file could face fines of 5% to 25% of the balance owed, in addition to cumulative interest. In serious cases, charges of fraud or evasion apply, with criminal implications. Transparency, they warn, is the only way to avoid conflicts.
Although stablecoins are pegged to fiat currencies, their use in lending, staking, or yield farming creates reportable obligations. NFTs, for their part, must be declared if they exceed $600 in sales, according to criteria similar to those for artistic properties. The treatment varies if they are created, bought or sold for commercial purposes.
