Taxing Cryptocurrency: US Digital Asset Regs
Doug McHoney (PwC’s International Tax Services Global Leader) is joined by returning guest Rebecca Lee, a Principal in PwC’s Washington National Tax Services Practice where she focuses on complex tax problems and financial transactions in the digital asset space. Doug and Rebecca discuss T.D. 10000, the recently published final regulations dealing with digital assets. They dive into the details of digital assets, including the definition of a digital assets, revisiting non-fungible tokens (NFTs) and blockchain, and the different types of digital transactions. They also cover the background of the final regulations, calculating gains and losses, determining basis, digital asset transaction costs, ordering rules, Form 1099-DA, Notices 2024-56 & 2024-57, and the applicability dates. They finish the podcast with an exploration of how other jurisdictions are approaching cryptocurrencies around the world, touching on FATCA, DAC8 and more.
Timestamps:
- 1:29 – What’s new in Rebecca’s life in the last 4-6 months since Rebecca was last on the podcast?
- 3:04 – What do the proposed regulations broadly cover and why did the original proposed regulations garner more than 44,000 comments?
- 4:55 – What was in the regulation package?
- 7:10 – Why are these regulations relevant for companies and corporate taxpayers?
- 9:04 – What is the definition of digital assets as laid out by these regulations?
- 12:40 – Why are loyalty programs a concern for taxpayers?
- 15:10 – How do the regulations calculate amount realized, a.k.a. gains?
- 17:23 – What information did they give about determining basis?
- 19:43 -- What is unused basis?
- 21:00 – What do the rules say regarding allocation digital asset transaction costs?
- 22:05 – What about the ordering rules?
- 23:00 – What are the key takeaways for reporting requirements?
- 26:22 – What is important for taxpayers to know about the 1099-DA form?
- 27:17 – What do Notice 2024-56 and Notice 2024-57 say with respect to transition rules for compliance?
- 29:00 – When are these rules broadly effective?
- 29:43 – What's going on around the world regarding the taxation of cryptocurrencies?
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