Several members of the US Congress’ House Committee On Ways And Means recently sent an open letter to the Internal Revenue Service (IRS), asking the country’s tax service to release a comprehensive guide for American taxpayers who earn gains on crypto investments and transactions.
In the letter, sent to current acting IRS commissioner David Kautter, US representatives Kevin Brady, Lynn Jenkins, David Schweikert, Darin LaHood, and Brad Wenstrup wrote to ask the agency to release crypto tax guidelines, arguing that it has had adequate time to develop clear rules on how to tax crypto profits.
The IRS has been focusing on enforcement instead of releasing rules, using a preliminary set of rules released in 2014, the letter claims, citing as an example the IRS’ push to collect customer earnings data from US crypto exchange Coinbase.
The letter urged the IRS to issue updated guidelines and provide clarity to taxpayers, with the lawmakers adding that:
“We are concerned that the IRS is seeking to enforce guidance that does not adequately advise taxpayers of their tax obligations when using virtual currencies.”
The lawmakers also argue that failing to issue sufficient guidance to taxpayers hinder the people’s ability to comply with their tax obligations.
The House Committee on Ways and Means, chaired by Brady, is set to ask the Government Accountability Office to conduct an audit on the matter as well.
Coin Center, a crypto advocacy group, praised the efforts from the lawmakers in a blog post. The group’s communications director, Neeraj Agrawal noted that current rules mean a user needs to calculate capital gains on nearly every item they buy with cryptocurrencies.
He says that:
“We are glad to see Congress take action – there are clearly many open questions surrounding taxation of cryptocurrencies. It’s promising to see members of Congress step up to call for a more welcoming environment for these new technologies.”
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