Bloomberg Tax
March 4, 2021, 6:56 PM UTC

IRS Stance on Crypto Spurs Confusion, Relief in Tax Profession

David Hood
David Hood
Reporter
Lydia O'Neal
Lydia O'Neal
Reporter

A recent Internal Revenue Service FAQ about reporting cryptocurrency activity on tax forms has sowed confusion and frustration among tax professionals.

Individuals who have purchased cryptocurrency with dollars should answer “no” to a tax return question aimed at cryptocurrency tax dodging, the IRS said in an answer posted online this week. But that position contradicts what the agency has told Americans for more than a year, ever since it updated the Form 1040 asking whether at any point in the previous year, “did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?”

The ...

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