Crypto Received from Abroad? Don’t Ignore 8300 Reporting (Yet)

cryptocurrency tax calculation using a calculator

Crypto Received from Abroad? Don’t Ignore 8300 Reporting (Yet)

Forbes Misinterpreted, Precipitating Events Trigger US Reporting for Now

Alert: Virtual currency/crypto/digital assets received in the trade or business from a foreign party are still subject to 8300 reporting.  A recent Forbes article Demystifying The $10,000 Crypto Reporting Payment Requirement (forbes.com) might be read to suggest that no reporting is due but this requires clarification. Let us know in the comments what you think. 

Under Reg. 1.6050I-1 Generally, there is no requirement to report a cash transaction but only if the ENTIRE transaction occurs outside the United States.  An entire transaction consists of the underlying event precipitating the payer’s transfer of cash to the recipient and the actual receipt of cash by the recipient.  The current rules are trying to fit a square peg into a round hole because there is no location of the actual receipt of crypto.  However, the precipitating event, such as the current or future provision of services or delivery of goods can be in the US.  We think that the rules, at least for the time being, shall be interpreted this way. 

We have not seen any special IRS news updates to the contrary.  Although, it would seem to be a better rule if the foreigners had been exempt from being reported to the IRS. 

As a consolation, the IRS’ instructions do provide that no TIN for a foreign party is necessary unless it is somehow involved in the US trade or business or has the TIN already for other purposes, such as withholdings. 

Instructions for Form 8300 (Rev. December 2023) (irs.gov)

Please, let us know in the comments if you disagree with our conclusions or if you do agree. Consider utilizing marketplaces like IfindTaxPro. You can post your project and find the right tax specialist for you.

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