{"id":24112,"date":"2023-03-21T10:23:27","date_gmt":"2023-03-21T17:23:27","guid":{"rendered":"https:\/\/coinnetworknews.com\/irs-calls-for-public-feedback-on-taxing-nfts-as-collectibles\/"},"modified":"2023-03-21T10:23:27","modified_gmt":"2023-03-21T17:23:27","slug":"irs-calls-for-public-feedback-on-taxing-nfts-as-collectibles","status":"publish","type":"post","link":"https:\/\/coinnetworknews.com\/irs-calls-for-public-feedback-on-taxing-nfts-as-collectibles\/","title":{"rendered":"IRS calls for public feedback on taxing NFTs as collectibles"},"content":{"rendered":"

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The United States Internal Revenue Service said it plans to release guidance on having nonfungible tokens, or NFTs, treated as collectibles under the U.S. tax code.<\/p>\n

In a March 21 notice, the IRS called<\/a> for feedback from the U.S. public on how NFTs could be taxed as collectibles. According to the government body, collectibles under U.S. tax law \u201cdo not have as advantageous capital-gains tax treatment as other capital assets,\u201d seemingly referring to how crypto assets are currently taxed in the country.<\/p>\n

\u201cUntil additional guidance is issued, the IRS intends to determine when an NFT is treated as a collectible by using a \u2018look-through analysis,\u2019\u201d said the notice. \u201cUnder the look-through analysis, an NFT is treated as a collectible if the NFT\u2019s associated right or asset falls under the definition of collectible in the tax code.\u201d <\/p>\n

Under the U.S. tax code, selling collectibles such as coins or artwork is subject to a maximum capital gains tax rate of 28%. The proposed IRS guidance could apply the same standard to an NFT certifying ownership of a coin, piece of art or similar collectible.<\/p>\n

The IRS called for comments to be submitted<\/a> by June 19, so U.S. taxpayers needing to file their 2022 returns<\/a> before the April 18 deadline likely won\u2019t be affected. Forms require anyone receiving, earning, transferring or selling crypto to check a box in the affirmative to correctly report their taxes and, depending on the filer\u2019s status, report transactions as capital gains or income.<\/p>\n

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If you owe taxes, it’s important to file your #IRS<\/a> tax return by the due date and pay as much as you can. Late-filing penalties are calculated based on the amount owed for each month a tax return is late. See https:\/\/t.co\/tZ7Ni3lhn3<\/a> pic.twitter.com\/FEnYtsBDiT<\/a><\/p>\n

\u2014 IRSnews (@IRSnews) March 21, 2023<\/a><\/p><\/blockquote>\n

Related:\u00a0Best and worst countries for crypto taxes \u2014 Plus crypto tax tips<\/a><\/em><\/strong><\/p>\n

In October, the IRS introduced a draft bill<\/a> proposing NFTs and cryptocurrencies be reported in a broad \u201cDigital Assets\u201d section for tax purposes. Generally, if a U.S. taxpayer hodls all digital assets for an entire year or transfers them between wallets they control, those holdings do not need to be reported.<\/p>\n