The US Internal Revenue Service. (IRS) has just published its first crypto tax guide in 5 years.
The publication of this document comes shortly after IRS Commissioner Charles Rettig said in May the agency was working on the development of a new and updated guide.
The IRS published its latest guide in 2014, meaning market participants have been waiting for an update for 5 years. The market has significantly evolved since then, which is why investors, traders and other actors need some new guidelines.
Regarding forks, the guide explains new cryptocurrencies created as a result of a fork of an existing blockchain should be treated as "an ordinary income equal to the fair market value of the new cryptocurrency when it is received." In other words, these coins will be taxed when they are registered in a blockchain and their owners can fully control and spend them.
The guide literally states that "if your cryptocurrency went through a hard fork, but you did not receive any new cryptocurrency, whether, through an airdrop (a distribution of cryptocurrency to multiple taxpayers’ distributed ledger addresses) or some other kind of transfer, you don’t have taxable income."
iHodl reported in July the IRS wants technological giants to report on users with crypto-related activity.