Senator Todd Young’s Call for IRS Reevaluation
Indiana Senator Todd Young is pressing the Internal Revenue Service (IRS) to reevaluate its taxation policies regarding cryptocurrency rewards obtained through staking. Under the current 2023 guidelines issued by the IRS, individuals are taxed upon receiving staking rewards rather than when they decide to sell those rewards. This approach has drawn criticism for taxing unrealized gains, creating confusion for consumers about their tax obligations.
“Senator Young has formally requested Treasury Secretary Scott Bessent to reconsider this issue, highlighting concerns about taxpayer uncertainty and complications that may arise in revenue forecasting for upcoming legislation.”
Advocacy for a Clearer Tax Framework
As a member of the Senate Finance Committee, Young is advocating for a clearer and more equitable tax framework as digital asset advocates continue to call for changes in the treatment of cryptocurrency staking.
New IRS Policy Proposal: Crypto-Asset Reporting Framework (CARF)
Recently, the IRS has also proposed a new policy to the White House known as the Crypto-Asset Reporting Framework (CARF). This initiative aims to establish a global tax standard that would enhance the IRS’s access to data concerning foreign cryptocurrency accounts owned by U.S. taxpayers. By 2028, this measure seeks to align U.S. tax regulations with those of 72 other countries, enforcing stricter reporting rules on capital gains from foreign entities.
The CARF, initiated by the OECD last year, intends to improve international cooperation on cryptocurrency taxation to reduce tax evasion. The rollout of CARF is anticipated to commence in 2027, with a number of nations—including economic leaders like Japan, Germany, and the United Kingdom—ready to implement it.
