IRS Finalizes New Regulations for Crypto Tax Reporting

Crypto platforms will be required to report transactions to the Internal Revenue Service (IRS) starting in 2026. However, decentralized platforms that do not hold assets themselves will be exempt from these regulations.

These new regulations, finalized by the IRS and U.S. Department of Treasury, aim to standardize the reporting of crypto transactions and make it easier for individuals to pay taxes on their crypto gains. Beginning in 2026, crypto platforms will need to provide a standard 1099 form, similar to those sent by banks and traditional brokerages.

The IRS is also seeking to crack down on tax evasion, with IRS Commissioner Danny Werfel stating that "we need to make sure digital assets are not used to hide taxable income, and these final regulations will improve detection of noncompliance in the high-risk space of digital assets."

The regulations apply to "custodial" platforms, such as Coinbase, that take possession of customer assets. Decentralized brokers that do not take possession of assets are excluded from these rules, following lobbying efforts by the crypto industry.

The Blockchain Association, an industry lobbying group, hailed the exemption as "a testament to the incredibly powerful voice of our industry and community." The Treasury Department and IRS have indicated that they will cover decentralized brokers in a separate set of regulations.

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AndroGuider Team

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