Digital Assets and Cryptocurrency – Reporting Basics

Course Classification:

– Category: Federal Tax (T).
– Credits: 2 IRS Continuing Education Hours.
– Provider: EZ Tax To Go LLC (Provider Number GFLRH).

Summary Description:
Digital assets are no longer a niche investment; they are part of your clients’ everyday financial lives, and the IRS has correspondingly increased its enforcement. This practical, foundational course will provide you with the essential knowledge to confidently navigate cryptocurrency taxation, ensuring compliance with strict new regulations and preventing costly errors for your clients. You will learn how to classify events, determine cost basis, and manage the transition to the new reporting requirements.

What will you learn in this course?

– Fundamentals and Classification: Determine what constitutes a digital asset for the IRS (property, not currency) and how to correctly answer the mandatory digital asset question on Form 1040.

– Taxable vs. Non-Taxable Events: Learn to clearly distinguish which transactions trigger a taxable event (such as crypto-to-crypto exchanges) and which do not (such as simple transfers between your own wallets).

– Basis Determination and New Reporting: Master the transition from the universal method to mandatory per-wallet tracking, and understand the phased implementation of the new Form 1099-DA (starting with gross proceeds for 2025 transactions and adding cost basis for 2026).

– Ordinary Income (Staking, Mining, and Airdrops): Apply the “dominion and control” principle to determine when and how to report staking rewards, mining income, and airdrop/hard fork distributions.

– Business Use and Compensation: Determine the proper tax treatment when cryptocurrencies are used to pay for goods and services, or as compensation to employees and independent contractors (triggering W-2 and 1099-NEC reporting).

– NFTs, Donations, and Gifts: Understand the basic tax treatment for creating and trading NFTs, as well as the rules for inheriting, gifting, or donating digital assets to charitable organizations (including the qualified appraisal requirement for donations exceeding $5,000).

Enroll today to master the fundamentals of crypto taxation, ensure your clients remain compliant with the new IRS rules, and future-proof your tax practice!