A Facebook executive stated that the company would work with the IRS on the tax reporting of digital currency transactions.
In testimony before the Senate Banking, Housing and Urban Affairs Committee, Facebook subsidiary Calibra CEO David Marcus stated that consumers would be provided with the necessary tools to report their taxes, but added that Calibra does not currently have processes in place to directly provide that information to the IRS. However, Mr. Marcus noted, Facebook "would be happy" to work with the IRS to ease the consumer burden.
Representative Warren Davidson (R-OH) introduced a bill that would enact a de minimis exemption for gains realized from the sale or exchange of virtual currencies for non-cash products. If approved, the exemption would create an exception for foreign currencies from taxes for transactions up to a set limit.
Commentary / Steven Lofchie
Taxing the purchase of ordinary goods with cryptocurrency (other than true dollar-linked stable coins) is one of the primary complications of using such currencies. Buying a tube of toothpaste using crypto becomes a taxable event if the value of the crypto has changed since the crypto was originally purchased. Getting a tax exception for de minimis transactions would be a significant development.
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