IRS Releases New Guidance on Transactions Involving Virtual Currency
Articles by: Richey May, Oct 11, 2019
Earlier this week the IRS released new guidance on crypto hard forks and airdrops. A hard-fork which results in an airdrop of new crypto cannot be treated like a stock split. According to Rev. Rule. 2019-24 the value of the newly airdropped cryptocurrency should be recognized immediately as ordinary income.
“A taxpayer has gross income, ordinary in character, under § 61 as a result of an airdrop of a new cryptocurrency following a hard fork if the taxpayer receives units of new cryptocurrency.”
To read the new guidance in its entirety visit https://www.irs.gov/pub/irs-drop/rr-19-24.pdf.
If you have any questions about how this new guidance impacts your business, or about the alternative investment services Richey May provides to the industry, please reach out to your Richey May tax professional or contact Stephen Vlasak.