US Lawmakers Call for Clear Updated Cryptocurrency Tax Guidelines, Writes IRS

A group of U.S. lawmakers has written the country’s Internal Revenue Service (IRS) seeking clear rules concerning cryptocurrency tax on behalf of taxpayers.

The open letter sent to the IRS was signed by representatives David Schweikert, Darin LaHood, Brad Wenstrup, Lynn Jenkins, and Kevin Brady, the chairman of the committee on Ways and Means.

“We therefore write again today to strongly urge the IRS to issue updated guidance, providing additional clarity for taxpayers seeking to better understand and comply with their tax obligations when using virtual currencies,” the lawmakers wrote.

Last year, the U.S. parliament raised questions about the enforcement actions that were being taken against crypto holders despite the lack of a comprehensive virtual currency strategy.

The IRS has gone ahead to enforce without updating the preliminary guidelines it published in 2014.

Notably, the summoned Coinbase cryptocurrency exchange over the cryptocurrency tax details of its customers between 2103 and 2015. In November 2017, the IRS won a case to obtain details of about 14,000 Coinbase customers.

The agency let out a reminder to taxpayers in March noting that it was mandatory for all Americans to disclose the profits made through trading on cryptocurrency. It warned of criminal charges for tax evasion and false tax filings which could result in a prison term or a fine of up to $250,000.

This further exposed the people’s ignorance about how to calculate and file cryptocurrency taxes.

The lawmakers expressed discontent stating, that “[they] are concerned that the IRS is seeking to enforce guidelines that do not adequately advise taxpayers of their tax obligations when using virtual currencies.”

They argued that the lack of updated guidelines severely hinders taxpayers’ ability to comply with tax obligations.

Finally, the lawmakers gave the IRS until October 17, 2018, to respond with an update on its effort to issue the comprehensive guideline and a timeline for its release.

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