Digital Asset Digest: Weekly Round Up

This week's highlights:

Welcome to the latest edition of the Digital Asset Digest. This week's newsletter is packed with the latest headlines, timely tax updates and industry insights.

Don't miss out on the latest and greatest from our team at Camuso CPA ! A few key highlights in this week's update!

• 💰 What does the IRS's 2025 crypto tax relief mean for investors?

• 🐦 Elon Musk Post About Crypto Taxes Drives New Talk on IRS Rules

• ⚖️ DeFi Faces IRS Challenges: New Tax Rule Draws Industry Backlash

• ⚡ Crypto Groups Sue IRS Over Decentralized Finance Reporting Rule

• 📊 New Crypto Regs will generate information deluge

• 🏛️ Texas Comptroller Issues PLR on Taxability of Hosting Services for Cryptocurrency Mining Machines

• 🐧 Why Did this Investor Sell Pudgy Penguin NFT for just $175?

• 📝 How to Prepare for Cryptocurrency Tax Compliance in 2025 with Camuso CPA

• 🎙️ Upcoming Podcast on The Financial Frontier : Redefining Banking: How Dakota Combines Crypto and Flexibility with Ryan Bozarth

• 📚 My Book, titled "Navigating The NFT Sales Tax Maze: Wayfair 2.0 for Web 3.0: From Virtual Assets to Real Obligations: Decoding Tax Compliance in the Digital Realm" is now AVAILABLE on AMAZON!

💰 What does the IRS's 2025 crypto tax relief mean for investors?

The IRS has issued Notice 2025-7, providing temporary relief for digital asset reporting. 

Key points:

• Relief Period: January 1 - December 31, 2025 • Scope: Applies to broker-held digital assets only

• New Identification Methods:

-Book record identification using specific identifiers -Standing order recorded in taxpayer's books

Relation to Rev. Proc. 2024-28:

• Notice 2025-7 supplements, not replaces, Rev. Proc. 2024-28 • Taxpayers must satisfy Rev. Proc. 2024-28 requirements before using this relief • Global allocation deadlines remain unchanged

This temporary measure addresses potential technological limitations of brokers in implementing specific identification methods required by recent regulations.

Read more here.

🐦 Elon Musk Post About Crypto Taxes Drives New Talk on IRS Rules

Elon Musk, the well-known tech entrepreneur and owner of X, recently stirred up the cryptocurrency world with a humorous post addressing the U.S. Internal Revenue Service (IRS) about taxing crypto.

Musk’s post, which highlighted the absurdity of crypto taxation, also quickly gained traction and reactions from the crypto community, generating hopes that Musk could influence the U.S. tax policy surrounding digital assets.

Read more here.

⚡ Crypto Groups Sue IRS Over Decentralized Finance Reporting Rule

The U.S. Treasury Department and Internal Revenue Service finalized a rule last week defining decentralized finance platforms as brokers for tax-reporting purposes, a move cryptocurrency groups called industry-crippling and quickly challenged in court as violating constitutional rights to due process and protection.

Read more here.

📊 New crypto regs will generate information deluge

Crypto reporting enters a new phase on Jan. 1, 2025, the effective date for the new 1099-DA and finalized reporting regs. Brokers, traders, banks, wallet hubs and taxpayers are still trying to digest the regulations and decide what is necessary to comply.

Read more here.

🏛️ Texas Comptroller Issues PLR on Taxability of Hosting Services for Cryptocurrency Mining Machines

The Texas Comptroller of Public Accounts Nov. 15 issued a Private Letter Ruling (PLR) regarding the taxability of hosting services for cryptocurrency mining machines.

The Comptroller determined that the machine hosting service provided by the taxpayer is not a taxable service under Texas law. However, the repair and restoration of the customer’s machines, which is part of the services provided, is subject to Texas sales and use tax as it is considered a taxable repair and restoration of tangible personal property.

Read more here.

🐧 Why Did this Investor Sell Pudgy Penguin NFT for just $175?

The Pudgy Penguin NFT series is one of the most demanded non-fungible tokens in the market, which is why they also have a decently high value. However, the people were speechless when an investor sold millions worth of NFTs for just $175. The user left people in both the non-fungible token industry and crypto industries curious, and some even created controversy about it.

Some are claiming that this sale was motivated by taxes.

Read more here.

📝 How to Prepare for Cryptocurrency Tax Compliance in 2025

The IRS has ramped up its efforts to ensure compliance within this space. By 2025, major changes will reshape the tax landscape for cryptocurrency investors and Web3 businesses alike. Understanding these updates and acting proactively can safeguard your finances and keep you compliant.

Here’s a comprehensive guide on what to expect and how to prepare for this evolving regulatory environment.

Read more here.

Here is what you need to know to prepare this 2025 audits!

🎙️ Upcoming Podcast on The Financial Frontier: Redefining Banking: How Dakota Combines Crypto and Flexibility

📅 Date: December 23, 2024 🕟 Time: 10:00 AM EST

In this episode of The Financial Frontier podcast, host Patrick Camuso, CPA sits down with Ryan Bozarth co-founder and CEO of Dakota, to dive deep into the future of banking and how crypto is transforming financial services for businesses worldwide.

Ryan shares his fascinating journey from working at companies like Anchorage and Coinbase to founding Dakota, a revolutionary banking platform that leverages cryptocurrency technology to provide businesses with unprecedented financial flexibility.  Link to the event here.

📚 My Book, titled "Navigating The NFT Sales Tax Maze: Wayfair 2.0 for Web 3.0: From Virtual Assets to Real Obligations: Decoding Tax Compliance in the Digital Realm" is now AVAILABLE on AMAZON!

Dive into the intricate world of NFT sales tax compliance with Patrick Camuso's groundbreaking book.

Uncover vital insights for CEOs, NFT artists, CPAs, and CFOs as you confront the pressing risks shaping the future of the Web3 industry. 💡

Arm yourself with indispensable knowledge to navigate the evolving landscape of Web3 finance.Order your copy on Amazon today and seize the competitive edge in the dynamic realm of NFTs! 📚

About Camuso CPA

As one of the first CPA firms to specialize in crypto tax, Camuso CPA is your trusted guide through the complex world of digital asset taxation.

Our team of experts can handle even the most complex crypto portfolios and businesses, ensuring accurate accounting and optimized tax strategies.

Our team of experts will:

Provide accurate and comprehensive accounting: Our team is skilled in tracking and reporting all your crypto transactions, ensuring compliance with tax regulations.

Optimize your tax strategy: We'll identify deductions, credits, and exemptions you may have missed, saving you thousands in taxes.

Provide personalized guidance: Our in-depth knowledge of the crypto industry ensures you receive tailored advice that fits your specific situation.

Offer peace of mind: We'll handle all your tax compliance needs, so you can focus on growing your crypto portfolio.

Ready to start saving? Schedule a free consultation today and let Camuso CPA help you unlock the full potential of your digital assets.

Learn more about us here.