[ad_1]
Thursday, June 8, 2023
Tax Classification Of Cryptocurrency, NFTs, DAOs, And Different Digital Belongings
Billy Abbott (O’Melveny & Myers, Silicon Valley), The Something Asset: The Tax Classification of Cryptocurrency, NFTs, DAOs and Different Digital Belongings, 26 Chap. L. Rev. 459 (2023):
The primary query for any tax practitioner taking a look at a digital asset might be this: What’s it? Given the flexibleness of digital belongings as evidenced by their already various use, in a way, a digital asset might be nearly something. Though tax advisors are used to making use of outdated guidelines to categorise new belongings, the flexibility of digital belongings will stretch that method and alter the follow of tax legislation. This Article explores the fascinating and difficult situation of classifying digital belongings: first, by means of particularly contemplating the tax classification of widespread classes of digital assets–cryptocurrency, DAOs and NFTS–and second, by asking whether or not all or any of these belongings might be labeled as “securities” or “commodities” below a number of key provisions of the Code.
Conclusion
The classification points described on this Article merely scratch the floor of thise that can come up when tax advisors search to use to present tax legislation to the wide range of digital belongings out there–not to say people who have but to be invented. However classification has at all times been a mainstay of tax follow. The addition of digital belongings to the financial system will impression the way in which tax legislation is practiced to make certain, however it’s going to additionally solely be the most recent in a protracted historical past of challenges confronted by advisors confronting novel conditions.
https://taxprof.typepad.com/taxprof_blog/2023/06/the-tax-classification-of-cryptocurrency-nfts-daos-and-other-digital-assets.html
[ad_2]