IRS gives businesses reprieve on digital asset reporting

By Michael Cohn
January 16, 2024

The Internal Revenue Service and the Treasury Department told businesses Tuesday they won't have to report on the digital assets they receive until regulations are issued.

The Infrastructure Investment and Jobs Act changed the rules requiring taxpayers that engage in a trade or business to report receiving cash of more than $10,000 by considering digital assets to be cash. In Announcement 2024-4 the Treasury and the IRS offered transitional guidance as they work to implement the new provisions. The Treasury Department needs to issue regulations before the provision goes into effect under the law.

However, the announcement doesn't have an impact on the rules that were in effect before the infrastructure law for cash received in the course of a trade or business. That still needs to be reported on Form 8300, "Report of Cash Payments over $10,000 Received in a Trade or Business," within 15 days of receiving the cash.

The Treasury and the IRS plan to issue proposed regulations to offer more information and procedures for reporting the receipt of digital assets, while giving the public a chance to comment both in writing and, if requested, at a public hearing. 

The IRS and the Treasury have lagged on issuing regulations regarding cryptocurrency like Bitcoin and Ether, but the tax service does have a page on its website dedicated to offering information on the tax treatment of digital assets like crypto. The IRS and the Treasury gave digital asset brokers a similar reprieve in December 2022 as they worked on regulations regarding who should be considered a broker.