Government Reports, Advisories, Hearings, Etc.


State Information

  • NSCL, Cryptocurrency Legislation - 2022, 2021, 2020
  • Arizona HB 2204 (Chapter 369, 7/6/22) - excludes from gross income value of virtual currency and NFTs received via an airdrop, at the time of the airdrop. If an included gain or loss on sale of virtual currency or an NFT, taxpayer may subtract "gas fees" from gross income.  Info including definitions from Senate Fact Sheet, 6/23/22.  See add'l info from 7/4/22 blog post at 21st Century Taxation.
  • ​Arizona HB 2417 (Chapter 97; 3/29/17) - Per the Senate Fact Sheet, "establishes guidelines for blockchain technology regarding electronic signatures and records." Also allows for "smart contracts."  Defines "blockchain technology" as "distributed ledger technology that uses a distributed, decentralized, shared and replicated ledger, which may be public or private, permissioned or permissionless, or driven by tokenized crypto economics or tokenless. The data on the ledger is protected with cryptography, is immutable and auditable and provides an uncensored truth." Defines "smart contract" as "an event-driven program, with state, that runs on a distributed, decentralized, shared and replicated ledger and that can take custody over and instruct transfer of assets on that ledger."
  • California Executive Order N-9-22 (5/4/22) - Promote and regulate blockchain, crypto assets and Web3.0 [press release]
  • California Legislative Hearing on Harmful Innovation: What FTX's Collapse Means for Consumers and California's Approach to Crypto, 2/22/23
  • California Franchise Tax Board (FTB) meeting of 9/23/22 had FTB staff presentation on digital currency payments.  Agenda /  Video (starts around 46 minutes)
  • California AB 2689 (2022) would have modified Corporations code to allow for payments in virtual currency
  • California AB 39 (2022), replacing AB 2269 (2022) to regulate difital financial asset business activity; passed by legislature, vetoed by Governor Newsom (9/23/22)
  • Information, Crypto Scam Tracker and FAQs from CA Dept. of Financial Protection & Innovation
  • California BOE Special Notice L-382 (June 2014) - If use virtual currency to buy a taxable item, sales tax owed based on the sales price of the item purchased.
  • California Dept of Business Oversight, Advisory on virtual currencies, 4/30/14 - press release + text
  • California Dept of Financial Protection & Innovation - letters (8/11/21 and 9/2/21) finding Bitcoin ATM machines don't need a Money Transmission Act license for a few reasons including that the company doesn't hold virtual currency for customers and sells Bitcoin from its own inventory. Rules likely to vary among states and particular facts.
  • Colorado Dept. of Revenue starts allowing payment via cryptocurrency (through PayPal system) (Sept 2022) + webpage with links to FAQs with more details
  • Colorado SB 18-086 (5/30/18) - Dept. of State must consider blockchain tech when accepting business licensing records and in distributing state data to other agencies.
  • Delaware SB 103 (signed 6/30/21) - adds virtual currency to unclaimed property reporting requirement for virtual currency but excepts game-related currency. VC must be liquidated and converted to USD before remitting to the State. Presumed abandoned 5 years after owner's last indication of interest in the property.
  • Delaware Blockchain Initiative launched in May 2016 by Governor Markell to attract this technology to the state and explore "distributed ledger shares" to be authorized by Delaware corporations.
  • Florida court rules Bitcoin is not money - The State of Florida v Espinoza, F14-2923 (11th Judicial Circuit, 7/22/16) - see ruling in this 7/25/16 Miami Herald article. This is a money services business ruling, not a tax one. The court explained Bitcoin and stated: "This Court is not an expert in economics, however, it is very clear, even to someone with limited knowledge in the area, that Bitcoin has a long way to go before it is the equivalent of money. ... Bitcoins ... are not monetary instruments." Thus, the court found that rather than exchanging money, the person sold property.
  • Miami generating money from MiamiCoin.
  • Illinois Blockchain Initiative.
  • Illinois IT 22-0010-GIL (7/15/22)
  • Illinois IT-21-0004 (8/31/21) Apportionment-Virtual Currency
  • Illinois SB0338 (Public Act 102-0288) - adding virtual currency to unclaimed property law
  • !!! Kansas Legislative Division of Post Audit, Reviewing Issues Related to State Cryptocurrency Tax Policies, July 2022 - this page includes a 16-minute audio and background report that provide an excellent background on crypto and federal and state tax considerations, including definitions of key terms.
  • Kansas Notice 20-04, Sales Tax Requirements Concerning Digital Currency Under the Retailers' Sales and Compensating Tax Acts, 11/2/20
  • Kansas Office of the State Bank Commissioner Guidance Document MT 2014-01 (6/6/14) - in some cases, exchange might be considered money transmission
  • Michigan Treasury Update Newsletter - August 2022, November 2015
  • Michigan - Sales tax information in Treasury Dept's Nov. 2015 newsletter
  • Minnesota Sales Tax Fact Sheet 177, Digital Products - NFTs subject to sales tax if underlying produce is taxable
  • Missouri LR 7411 (9/12/14) - no sales tax imposed when customers obtain bitcoin from ATM because the bitcoin is intangible.
  • Missouri Reg. 12 CSR 10-2.076(2)(H)(3) - "Receipts from the sale or exchange of currency, including foreign currencies or cryptocurrencies, are excluded from the definition of "receipts" used in section 143.455.3.(6)."
  • Nevada - SB 398 (Chapter 391; 6/5/17) allow blockchain tech as electronic record of Uniform Electronic Transactions Act, prohibit local gov't from taxing or restricting use of blockchain.
  • New Hampshire - 2/9/22, Governor Sununu created the Commission on Cryptocurrencies and Digital Assets via Executive Order 2022-1. The Commission is to make findings "regarding the role and effectiveness of current state laws and regulations governing cryptocurrencies and other digital assets and the reasons why modifications and improvements to such laws and regulations are necessary, addressing factors such as" innovation, access to digital assets and the effect on privacy and liberty rights.
  • New Jersey - TAM 2015-1 (4/2/15) updated 3/21/22
  • New York - sales and income tax treatment of virtual currency - TSB-M-14(5)C, (7)(I, (17)S (12/5/14) - sales tax guidance; income tax - follows IRS Notice 2014-21
  • New York Attorney General James proposes regulations for cryptocurrency industry (5/5/23)
  • New York Attorney General Reminds Crypto Investors to Pay Taxes on Virtual Investments, 3/23/22 - reminds investors that in addition to civil and criminal tax law violations for not reporting, there can be actions brought under the state's False Claims Act with additional fines.
  • New York Attorney General launches Virtual Markets Integrity Initiative (April 2018) described as "a fact-finding inquiry into the policies and practices of platforms used by consumers to trade virtual or “crypto” currencies like bitcoin and ether" to provide "the accountability and transparency in the virtual currency marketplace that investors and consumers deserve.”  Press release + survey sent to 13 platforms + final report + Bitcoin.com's 9/19/18 article on 8 surprising findings from the initiative.
  • New York Public Service Commission news release 7/12/18 - higher utility rate allowed for those involved with cryptocurrency mining or providing the computer capacity for it.
  • New York State, Dept of Financial Services​ and BitLicense Info
  • New York, S 6486D/A7389 (Chapter 628, 11/22/22) - two year moratorium on use of Proof of Work in the state.
  • Ohiostarted taking bitcoin for tax payments around Nov. 2018, but the next treasurer stopped the practice (Coindesk, 2019)
  • Pennsylvania Dept. of Revenue updates Bulletin and REV-717 to state that non-fungible tokens are subject to sales/ use tax within the category of computer hardware, digital products and steaming services (June 2022).
  • Tennessee HIT-15, Interest and Dividends Received from Virtual Currency - include in Hall income tax (6/15/21)
  • Texas Dept of Banking, Supervisory Memorandum 1037 (4/3/14) - generally finds that exchanging virtual currency for sovereign currency is not a currency exchange under Texas law.
  • Utah
    • HB 456 (signed 3/24/22) - Division of Finance to contract with third party to allow certain agencies to accept payment by digital asset defined as "a representation of economic, proprietary, or access rights that is stored in a computer readable format." Effective 7/1/22.
  • Vermont - several new laws and activities:
    • S 269 (Act. No. 205; 5/30/18) on blockchain business development, including creation of blockchain-based LLCs and a study on possible use of blockchain for government records.
    • Center for Legal Innovation at Vermont Law School, Financial Tech Report for legislature, 12/7/17
    • H. 182 (Act 22; 5/4/17) on rules for money transmitters including virtual currency.
  • Washington Department of Revenue
    • Interim Statement Regarding Taxability of NFTs, 7/1/22
      • Defines NFT as "digital code on a blockchain comprised of unique identification codes and metadata that distinguish them from one another. The following terms, which are used throughout this statement, are not legal definitions but are rather functional descriptions that the Department has developed based on how the terms are used by industry participants" and then defines token, non-fungible and NFT.
      • Explains with examples that application of retail sales tax and B&O tax to NFT transactions. Generally subject to sales tax.
    • Interim Statement Regarding Bitcoin: Payments, Mining, and Investment Income, 8/20/19
  • West Virginia SB 4511 (Chapter 282; 4/19/22) - adds presumption of abandonment period for virtual currency to unclaimed property tax law; holder must liquidate the currency before transferring to the state
  • Wisconsin Tax Bulletin, April 2021 - guidance for income/franchise, withholding and sales tax
  • Wisconsin Tax Bulletin, October 2022 - taxation of NFTs
  • Wyoming, SF 111, Chapter 45 (3/10/18) - virtual currency is not subject to personal property tax.
  • Wyoming, SF 0038, Chapter 162 (4/21/21), Decentralized Autonomous Organizations (DAOs) - allow for formation of DAOs as LLCs. Bill summary includes: "A decentralized autonomous organization (DAO) is a limited liability company with special provisions allowing the company to be algorithmically run or managed (in whole or in part) through smart contracts executed by computers."
    • FAQs from Wyoming Secretary of State

Virtual Currency & Blockchain Technology

​​HOME                       Copyright © 21st Century Taxation. All rights reserved.

This webpage, maintained by Professor Annette Nellen, is intended to provide information and links about taxation of virtual currencies (aka cryptocurrency) in the U.S. and elsewhere, and non-tax information, including about blockchain (aka distributed ledger technology), government activities, crypto articles, and more. Please scroll through to see topics and links.


U.S. Income Taxation

In March 2014, the IRS issued Notice 2014-21 and Information Release IR-2014-36, on the income tax treatment of virtual, convertible currency, such as bitcoin. The IRS has ruled that virtual currency is treated as property, rather than currency for tax purposes. That means it needs to be valued when used (such as to buy goods or to compensate an employee or to acquire a different virtual currency) to determine tax consequences. For example, assume Jane purchased X bitcoins last year for $100. Today, she uses that X bitcoin amount to buy clothes worth $120. Jane has a $20 gain on this transaction. Assuming she is an investor or trader in bitcoin (rather than a dealer), this is a capital gain which is taxed at a lower rate for federal income tax purposes than other income such as wages (assuming it is a long-term gain). Jane must keep records to track the basis of all virtual currencies she purchases and identify which ones she uses when she buys something. Basically, Jane is bartering.  For more on the tax rules and issues, exchange rates, and other information, see the links below.

Accounting Resources


The White House, U.S. Treasury FinCEN and Related Information​


11/10/23 - Collective Engagement to Implement the Crypto-Asset Reporting Framework (CARF) - several countries have agreed to consider CARF for global tax transparency purposes.

4/6/23 - Treasury, 2023 DeFi Illicit Finance Risk Assessment Report

7/8/22 - Treasury seeks comments by 8/8/22 on specific questions posted related to President Biden's Executive Order 14067 (3/9/22), Ensuring Responsible Development of Digital Assets." Described as "an opportunity for all interested parties to provide relevant input, data, and recommendations pertaining to the implications of development and adoption of digital assets and changes in financial market and payment infrastructures for United States consumers, investors, businesses, and for equitable economic growth."


9/16/22 - Treasury issues three reports related to Exec Order 14067 (see above):


​The Financial Crimes Enforcement Network (FinCEN) of the U.S. Treasury Department has issued guidance on banking and other aspects of virtual currency.

CFTC holds that bitcoins are a commodity (9/17/15 ruling)  +  CFTC Bitcoin website

Remarks From Under Secretary of Terrorism and Financial Intelligence David S. Cohen on "Addressing the Illicit Finance Risks of Virtual Currency" 3/18/14


21st Century Taxation

Tax Reform - Modernizing Tax Systems,      Following Principles of Good Tax Policy ​

Exchange Rate Information from Exchanges and Data Aggregatos

These are samples, not an exhaustive list.​

21st Century Taxation blog posts and presentations with links to information about taxation of virtual currencies 


Taxation and Regulation in Other Countries - Virtual Currencies, ICOs​, the Blockchain
Please note - this is not a complete list and some URLs may have changed or been removed.

IRS Guidance and Government Reports on Taxation 


  • Rev. Rul. 2023-14 - IRS guidance on taxation of tokens derived from Proof of Stake activities for cash method taxpayers. See additional information below on one modification and comments letters from AICPA about the notice.
  • Digital Asset reporting as added by Infrastructure Investment and Jobs Act (P.L. 117-58, 11/15/21) - track changes to IRC sections 6045, 6045A, 6724 and 6050I and background info and reg info
    • Final Regs (TD 10000; 7/9/24) and two notices and one revenue procedure (IR-2024-178 (6/28/24))
      • NOTE: For individuals who tracked basis of digital assets using "universal" approach allowed by IRS virtual currency FAQs 39 - 41, read Rev. Proc. 2024-28 as it provides a safe harbor you likely want to make but must do the work by 1/1/25!! Also note that the IRS virtual currency FAQs (at least at 9/23/24) have not been updated for the final 6045 regs or Rev. Proc. 2024-28 despite the bottom of that page saying it was updated in August 2024 (after the latest guidance was out - reminder to always be cautious in using FAQs!)
    • Prop. Regs under 6045 - REG-122793-19 (8/29/23) & IR-2023-153 (8/25/23) & Treasury press release of 8/25/23 - generally first effective for 1099-DA forms due in January 2026 for 2025 activity.
  • Notice 2023-27 - IRS seeking comments on NFTs as collectibles under sections 408(m) and 1(h)
  • CCA 202316008 (4/21/23) - the ETH merge from PoW to PoS is not an exchange under section 1001
  • CCA 202302011 (1/13/23) - IRS discussion of certain crypto losses (note that CCAs are not binding but the law section uses binding guidance and this illustrates current IRS thinking; it should have been issued as a binding revenue ruling, particularly since this is "non-taxpayer specific advice")
  • CCA 202302012 (1/31/23) - IRS reminder that if non-cash donation is worth over $5,000 a qualified appraisal is needed even if it is cryptocurrency traded on an exchange (see caveat above regarding CCAs)
  • ​Rev. Rul. 2019-24 (10/9/19) on forks and airdrops (but not as clear as we need)
  • NYSBA comment letter on open tax issues (4/18/22) including whether VC is a commodity or security, application of §475, lending crypto, and proof of stake.
  • §1031 and virtual currency:
    • No longer a federal issue after 2017 per TCJA.
      • IRS limited guidance in 2021 - CCA 202124008 (6/18/21) - application of §1031 to specified virtual currencies including bitcoin [I don't agree with the bitcoin-litecoin conclusion of the IRS]
    • Still an issue in California - see this §1031 paper with suggestions for guidance from FTB
  • FAQs created on 10/9/19 on Notice 2014-21, Rev. Rul. 2019-24 and a few new topics (some of
    these present new rules and should really have been in proposed regs such as the suggestion
    that it is ok to use FIFO to track use of virtual currency).
  • 2023 draft tax forms - digital assets question to be added to Forms 1120, 1120S and 1065 - see AICPA comments (7/28/23)
  • 2022 draft Form 1040 (a 9/1/22) has revised wording and replaces "virtual currency" with "digital assets". Likely that change is due to "digital assets" being added to section 6045 by the Infrastructue Investment and Jobs Act in Nov. 2021. But that definition gives reg authority to IRS for futher refinement of the definition and at 10/1/22, there are no proposed regs. On 8/29/22, the AICPA Virtual Currency Tax Task Force issued a letter with comments about the question and suggestions for improvement. Note: Final 2022 Form 1040 has digital asset question just as in the draft.
  • 2021 IRS Form 1040 Page 1 - the question is modified from 2019 and 2020 to remove "send" and replace "acquire" with "dispose of."  That's quite a change. Issues from the 2020 instructions are still in the 2021 instructions (see below for more background on this question0.
  • 2020 IRS Form 1040 Page 1 - the 2019 Sch 1 question was moved to top of page 1 for 2020. The instructions (pages 15 - 16) provide a bit more info than for 2019 but leave many questions unanswered such as why the term "virtual currency" is used rather than "convertible virtual currency" on which IRS and FinCEN guidance is based, and whether gaming currency convertible to/from fiat warrants a "yes" answer. Note the broadness of the question that requires a "yes" answer for receipt of a virtual currency in any manner. The instructions also raise some puzzling questions. For example, they include: "Regardless of the label applied, if a particular asset has the characteristics of virtual currency, it will be treated as virtual currency for Federal income tax purposes." What does that mean? gaming currnency? certain gift cards? virtual sport trading cards?
    • 3/2/21 - IRS added FAQ 5 to say that if the only virtual currency transaction was the purchase of it, the 1040 answer is no.  Observation: This is odd since the question asks if "otherwise acquired."
  • 2019 IRS Schedule 1 includes a new question: "At any time during 2019, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?"  The 1040 instructions (p 81) provide more information on this question including what is considered a transaction involving virtual currency. Note: Not all individuals are required to file this schedule. It appears though that if anyone has to answer "yes" they must file the schedule. The instructions do say that if the answer is "no" and you don't otherwise have to file Schedule 1, you can skip filing it.
        Lots of questions here - what if someone transfers a virtual currency from one wallet to another? What if there was a hard fork during the year that the taxpayer doesn't learn about until much later (which the IRS views as received once recorded on the distributed ledger (per Rev. Rul. 2019-24))?  What is an individual's partnership owns some and the partner doesn't know? What if you received some by gift and held onto it? Likely a good idea to attach a statement explaining why you check "yes" but don't have any virtual currency transaction noted on the return such as because  you received some by gift and held onto it rather than disposed of it.
        And just what does the IRS view as "virtual currency"? Between early October 2019 and February 12, 2020 the IRS broadly defined virtual currency to also include some gaming currency such as Roblox and V-bucks (click here for 10/12/19 version from the Wayback Machine).  After some attention on social media such as parents wondering if they need to answer "yes" because of gaming activities of their children, the IRS issued a "statement" on Feb 14, 2020 and changed the language on its Virtual Currency website. Per the statement, using virtual currency in a game that never leaves the game (not convertible) doesn't warrant a "yes" answer. But, some of the game currency does leave the game environment, so taxpayers need to check. See my blog post of 2/15/20 for issues I think exist with this broad definition and losing site of tax considerations. Also sounds like the IRS needs to say more as given their still broad definition of virtual currency, perhaps some gift cards or merchant point systems are a convertible virtual currency.
  • IRS CC 2020-003, Procedures for Coordination of Cases Involving Virtual Currency (10/22/19) - information for IRS attorneys working cases involving virtual currency and digital assets
  • Notice 2014-21 (3/25/14), modified by Notice 2023-34 to modify sentence regarding virtual currency as not being legal tender; Q&A2 remains that virtual currency is not treated as foreign currency
  • Should virtual currency ever be reportable on an FBAR?
    • FinCEN and FBAR reporting - see Kirk Phillips, "Virtual currency not FBAR reportable (at 
      least for now)      ," Journal of Accountancy, 6/19/19
    • Dec. 2020, FinCEN issued Notice 2020-2 stating that a foreign account holding virtual currency is not a reportable account, but that Fin CEN "intends to propose to amend" the BSA regs on this. [As of 10/10/22, no regs]
  • IRS started sending letter to virtual currency owners to check their filings, IR-2019-132 (7/26/19). includes links to the 3 types of letters sent
  • IRS reminders on virtual currency reporting, IR-2018-18 (3/23/18)
  • IRS LB&I adds virtual currency as an examination campaign (7/2/18)
  • 21 members of Congress ask Comm's Rettig for more guidance (4/11/19)
    • Commissioner Rettig says more guidance is on its way (5/16/19)
  • Congressman Brady calls on IRS to issue more guidance (Sept. 2018)
  • IRS Webinar - Understanding the Basics of Virtual Currency (2018)
  • Kimmelman v Wayne Insurance Group, No. 18 CV 1041 (Ohio Ct Common pleas, 9/25/18) - K's filed claim for stolen bitcoin and insurance company awarded $200 for stolen cash claim. Court agreed with K's argument that it is property as labelled by the IRS in Notice 2014-21.
  • J5 - Global Tax Enforcement - On 7/2/18, the Joint Chiefs of the Global Tax Enforcement  announced a joint effort to "combat international tax crime and money laundering." This effort includes "fighting ... cybercrime through the use of cryptocurrencies." The J5 consists of criminal investigation units from Australia, Canada, Netherlands, UK and the U.S.
  • Example of IRS enforcement efforts - Dept. of Justice press release of 2/13/20 on finding person operating a darknet-based bitcoin mixer that laundered over $300 million for others.
  • IRSAC Report of Nov. 2023 includes recommendations related to the IRS possibly accepting virtual currency for tax payments
  • IRSAC Report of Nov. 2018 includes recommendations on virtual currency and IRS
  • IRS National Taxpayer Advocate's 2013 Annual Report to Congress - Most Serious Problem #24 -The IRS Should Issue Guidance to Assist Users of Digital Currency (pages 249 - 255)
  • GAO, Virtual Economies and Currencies: Additional IRS Guidance Could Reduce Tax Compliance Risks (5/15/13)
  • OECD, BEPS Action 1, March 2014, see pages 15 - 16
  • IMF, Virtual Currencies and Beyond: Initial Considerations, Jan. 2016 + press release (1/20/16)
  • TIGTA press release (11/8/16) and report (9/21/16) pointing out that the IRS is not using its enforcement tools to "address virtual currency tax noncompliance." TIGTA also points out that while the IRS sought comments on where additional guidance needed (per Notice 2014-21), it has not issued any additional guidance.
  • 2021 - Summons on Circle Internet Financial Inc. + details
  • Court denies motion to quash IRS summons - Zietzke,  No. C19-1234-JCC (WD WA, 11/25/19); summons issued to Bitstamp and a user challenged it. Court did find that it was overly broad but otherwise valid.
  • 2016-2018 - IRS John Doe Summons – U.S. v. John Doe,  No. 3:16-cv-06658-JSC (ND CA 11/30/16) – The IRS filed a petition to obtain two years of records from Coinbase (2014 and 2015). The 16-page petition (11/17/16) explains how virtual currency works and what Coinbase does. It also provides an example the IRS Revenue Agent found that involved moving millions of virtual currency. The IRS believes that some of its customers have not complied with the tax laws. See Stan Higgins, “The IRS is Seeking Data on Coinbase’s Bitcoin Customers,” CoinDesk, 11/18/16. See 11/30/16 Dept. of Justice press release on the court's grant of permission to the IRS to serve the summons + 11/17/17 court order. In March 2017, the Department of Justice filed a petition asking Coinbase to show cause for not producing the records (also see No. 3:17-cv-01431-JSC (ND CA, 3/16/17)). This petition lays out concerns of the IRS including that in 2013 and 2014, it looks like only about 800-900 individual returns reported any gain or loss from bitcoin transactions. On 5/17/17, Senator Hatch and Congressman Brady sent a letter to the IRS questioning the scope and basis for the summons as it seems overly broad in asking for records of over 500,000 active users of Coinbase. On 7/18/19, the District Court granted Doe #4 the right to intervene upon showing that the IRS summons was broad in that the IRS likely doesn't need all records of the million+ Coinbase users (also see 7/25/17 blog post of Procedurally Taxing). Per a July 6, 2017 filing, the IRS agreed to only look at "accounts with at least the equivalent of $20,000 in any one transaction type (buy, sell, send, or receive) in any one year during the 2013-15 period." Also see Coin Center's 8/3/17 amicus brief arguing that the IRS summons is too broad.  On 11/28/17, the final decision was issued by the court to require Coinbase to produce documents for accounts with at least the equivalent of $20,000 in any one transaction type (buy, sell, send, or receive) in any one year during the 2013 to 2015 period (Case 3:17-cv-01431-JSC) . Also see Feb. 2018 information from Coinbase to its customers.


Additional Resources on Tax Considerations

Articles and Information about Virtual Currencies & Blockchain Technology