IRS Simplifies Reporting Requirements for Crypto Transactions
Form 1099-DA has been updated by the IRS to simplify reporting requirements for digital asset transactions. The new draft removes previous requirements such as specifying wallet addresses and transaction IDs, now only requiring the date of each transaction.
Positive Response from Crypto Community
The changes to Form 1099-DA have been well-received by the cryptocurrency industry, with some calling it a step in the right direction. Attorney Drew Hinkes from K&L Gates described the updated form as “massively improved” due to requiring less data reporting.
Impact of Proposed Regulations on Crypto Brokers
Form 1099-DA is a result of reporting rules proposed by the IRS and the Treasury Department to align crypto brokers with traditional counterparts. The broad definition of brokers includes trading platforms, payment processors, and hosted wallets, aiming to ensure consistent tax treatment across different asset classes.
