Cryptocurrency investors and traders aren’t the only ones pleading with the Internal Revenue Service for more clarity on crypto taxation. The American Institute of Certified Public Accountants, the world’s largest professional association for accountants, joined the chorus on Wednesday by calling for additional guidance on matters like gain and loss reporting, expenses related to cryptocurrency mining, chain splits, air drops and more.
The IRS released preliminary guidance in 2014, known as Notice 2014-21, deeming that it considers virtual currencies as property for taxation purposes. While the cryptocurrency ecosystem has exploded in interest and market size since then, the agency has not released any additional guidelines despite pleas from the industry to do so.
“Virtual currency transactions, in which taxpayers increasingly engage, add a new layer of complexity to the analysis of a client’s reporting requirements,” Annette Nellen, chair of the AICPA Tax Executive Committee, stated in a 21 page letter from the group to the IRS released Wednesday, adding:
“We recommend the Internal Revenue Service release immediate guidance regarding the tax treatment of virtual currency transactions, similar to that of Notice 2014-21 so that authoritative guidance exists.”
AICPA claims more than 400,000 members across 143 countries. Its recommendations were developed by a Virtual Currency Task Force and approved by the AICPA Tax Executive Committee.
The letter spelled out a list of 12 specific areas in which more guidance is needed.
“Specifically, we request additional guidance that will address items from the original Notice 2014-21, and new issues that are relevant to the 2017 tax year, such as chain splits, that have arisen subsequent to the release of the original notice,” Nellen states.