Dissecting the latest in the world of crypto assets and taxes | Tax Section Odyssey
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Dissecting the latest in the world of crypto assets and taxes | Tax Section Odyssey

Oct 06, 2021 · 21 min listen

Explore the tax universe.

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In this episode

As virtual currencies gain more traction in the marketplace, the IRS is taking notice. Your clients may be unaware of the tax reporting requirements and the tax implications from their cryptocurrency transactions.

In this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, Association of International Certified Professional Accountants, representing AICPA & CIMA, and Shehan Chandrasekera, CPA, Head of Tax Strategy — CoinTracker, delve into the cryptic world of virtual currency and discuss practical tax compliance tips.

What you’ll learn in this episode

  • History and the basics of cryptocurrency (1.01)

  • Advantages and benefits of owning and transacting with cryptocurrency (2.39)

  • Non-fungible tokens (NFTs) (4.18)

  • The taxation of cryptocurrency and IRS guidance (5.56)

  • Advice to clients regarding cryptocurrency activity and transaction tracking (8.39)

  • How to answer the virtual currency question on the Form 1040 (10.53)

  • Potential tax legislation and virtual currency (13.01)

  • What to do when a client receives an IRS letter or notice regarding virtual currency activity (15.07)

  • Journal of Accountancy podcast episode that focuses on the recent annual tax software survey (18.43)

AICPA resources

Other resources

  • Coinmarketcap.com — Website consolidating the various cryptocurrency properties and current prices

  • IRS Notice 2014-21 — IRS guidance for individuals and businesses on the tax treatment of transactions using virtual currencies

  • Rev. Rul. 2019-24 — IRS guidance that addresses common questions by taxpayers and tax practitioners regarding the tax treatment of a cryptocurrency hard fork

  • The IRS also published Frequently Asked Questions on Virtual Currency Transactions for individuals who hold cryptocurrency as a capital asset and are not engaged in the trade or business of selling cryptocurrency

  • CoinTracker — Software to help track cryptocurrency investment performance and taxes.

  • Lukka — Data and software solutions to manage crypto assets on infrastructure built for the future of commerce. In December 2019, CPA.com announced a strategic alliance with Lukka to deliver crypto asset solutions to firms.

  • IRS Cryptocurrency Tax Letter Guide: 6173, 6174, 6174-A, CP-2000 — Step-by-step guide to help taxpayers know what to do if they receive a cryptocurrency-related letter from the IRS

  • Tax software: What CPAs like and dislikeJournal of Accountancy podcast where editors Alistair Nevius and Paul Bonner discuss details of the annual tax software survey.

Keep your finger on the pulse of the dynamic and evolving tax landscape with insights from tax thought leaders in the AICPA Tax Section. The Tax Section Odyssey podcast includes a digest of tax developments, trending issues and practice management tips that you need to be aware of to elevate your professional development and your firm practices.

This resource is part of the robust tax resource library available from the AICPA Tax Section. The Tax Section is your go-to home base for staying up to date on the latest tax developments and providing the edge you need for upskilling your professional development. If you’re not already, consider joining this prestigious community of your tax peers. You'll get 16 hours of free CPE, access to rich technical content such as our Annual Tax Compliance Kit, a weekly member newsletter and a subscription to The Tax Adviser.

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