Coinbase: New US crypto tax regulations are complex; stablecoin and gas fee reporting may lead to "over-reporting" by the system.

Coinbase has stated that the IRS's 1099-DA rule for digital asset tax reporting is overly cumbersome and could impose unnecessary administrative burdens on a large number of cryptocurrency holders. Lawrence Zlatkin, Coinbase's VP of Tax, pointed out that the new rule requires reporting small transactions such as stablecoin transactions and network gas fees. Since stablecoin prices are generally stable and gas fees are typically only a few dollars or less, reporting this type of information could lead to "over-reporting," further complicating the tax system. Coinbase is currently sending 1099-DA forms to millions of US users. This system requires exchanges to report users' digital asset transactions to the IRS and provide users with copies so they can self-report profits and losses. However, in this year's filings, Coinbase only reports gross proceeds from digital asset sales to the IRS, without providing a cost basis. Users must calculate their true taxable income themselves, which may confuse some investors. Coinbase plans to start calculating the cost basis for users from next tax year onwards to simplify the filing process. (Interactivecrypto)