The US Internal Revenue Service (IRS) has begun implementing aspects of President Joe Biden's Infrastructure Investment and Jobs Act of 2021, including a requirement that all cryptocurrency transactions exceeding $10,000 be reported to the tax authority.
Cryptocurrency Transactions Over $10,000 Will Be Reported to the IRS
The bill, passed by both houses of Congress and signed by President Biden, introduced the 6050I rule. This rule requires brokers to report all transactions received from crypto exchanges and custody providers that meet or exceed the $10,000 threshold.
This rule was introduced as part of an attempt to prevent money laundering, tax evasion and the financing of terrorism. The new reporting requirement, originally planned to go into effect in January 2023, only applies to businesses using crypto assets and does not affect individuals. US taxpayers have already been required to report all digital asset transactions since 2019.
Jerry Brito, executive director of crypto advocacy think tank Coincenter, said:
“This law went into effect on January 1st, and all Americans are now subject to it. This law is a self-implementing law, meaning it does not require additional regulatory action or enforcement by any government agency to go into effect. Once the law is passed and signed, it In this case, it immediately became operational and applicable on the effective date of January 1, 2024.”
*This is not investment advice.