The U.S. Internal Revenue Service (IRS) has ambitions to update its stance on cryptocurrency taxation within the next ‘12-ish’ months. Julie Foerster, crypto asset project director made public her team's intentions at Consensus 2023. Making a point to stress these were views were her own, she also noted that the IRS want to collaborate with the crypto industry to ensure they get it right.

The IRS currently consider cryptocurrencies as convertible virtual assets that can be used as payment for goods and services, digitally traded between users, and exchanged for other currencies. This means that for federal tax purposes, they are considered property and users are required to report their digital assets activity on their tax returns. However, Foerester highlighted that the landscape for digital assets is an evolving one and therefore communications between the agency and the crypto community should be increased. She also referred to a March proposal to tax non-fungible tokens (NFT) like other collectibles, for which comment period closes June 9th.

The IRS are also building relationships with other countries, to determine what the best practice for crypto taxation is. Additionally, the agency wants to find new and innovative ways to spread their message and encourage voluntary compliance.

Event such as Consensus 2023 provide the IRS with a unique opportunity to gain insights into the cryptocurrency industry. The team hopes to use these events to build connections and increase awareness of the ever-changing digital asset landscape. Foerester's ambition to issue crypto tax guidance ready in "in 12-ish months" is an encouraging sign and could usher in a more up-to-date approach in tax compliance.



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