The Department of Treasure has issued new guidance that it plans to implement a new requirement for crypto transfers of at least $10,000 be reported to the Internal Revenue Service. This requirement is akin to cash transactions greater than $10,000.
Webb & Morton PLLC
Latest from Webb & Morton PLLC - Page 3
Is Crypto Staking Taxable Income?
In a novel crypto tax case out of the U.S. District Court for the Middle District of Tennessee, a taxpayer has challenged the IRS’s ability to treat staking rewards as ordinary income. The taxpayer asserts that staking rewards are the…
“Flora” full payment rule does not apply to FBAR penalties
It is well established that a taxpayer must pay all tax first before filing a refund suit against the IRS in Federal District court. This is called the Flora rule. In Mendu v. United States, the Court of Federal Claims…
Does Kraken Report to the IRS?
On May 5, 2021, a California District Court issued an order authorizing the IRS’s John Summons against Kraken, a popular cryptocurrency exchange. The summons seeks to obtain information on US taxpayers who conducted at least $20,000 in total transactions for…
Reckless Review of Tax Return and Willful FBAR Penalties
In March 2021, in U.S. v. Gentges, the court held that a taxpayer filing an erroneous tax return – despite his carelessness in reviewing it before he signed it – was nevertheless per se evidence of reckless conduct giving rise…
The IRS Will Seize Your Crypto Assets
In May 2021, an IRS Official clarified that the IRS will seize cryptocurrencies and sell them to satisfy tax collection if a taxpayer fails to meet his tax obligations. Because cryptocurrency is treated as property for tax purposes, just like…
Hard Fork Can Result in Gross Income
In a recent Chief Counsel Advice Memorandum, the IRS made clear that receipt of a “new” cryptocurrency (following a Hard Fork) results in gross income to the taxpayer (equal to its Fair Market Value) immediately upon the taxpayer’s dominion and…
New IRS Summons to Cryptocurrency Exchange Kraken
On May 5, 2021, a California District Court issued an order authorizing the IRS’s John Summons against Kraken, a popular cryptocurrency exchange. The summons seeks to obtain information on US taxpayers who conducted at least $20,000 in total transactions for…
Your Marijuana Business for Federal Tax Purposes
While cannabis (or marijuana) is legal in some states for medical and recreational use, cannabis is still a Schedule 1 narcotic for federal purposes. Because of this, Section 280E of the Internal Revenue Code applies. Section 280E disallows deductions or…
FBAR Penalty – Per FBAR Due, Not Per Account
In a case of first impression, the Court of Appeals for the Ninth Circuit ruled that the IRS can impose only one non-willful penalty under 31 USC 5321(a)(5)(A) when an untimely, but accurate, Report of Foreign Bank and Financial Accounts…