Key Highlights
- John Daghita, a U.S. government contractor, was arrested by the FBI for allegedly stealing $46 million in cryptocurrency from U.S. Marshals Service wallets.
- The stolen funds include assets from 2024 government seizures, including the Bitfinex hack, and were traced through multiple wallets.
- Daghita is the son of CMDSS CEO Dean Daghita, a company with a government contract to manage seized cryptocurrency
The Internal Revenue Service (IRS) has suggested a new rule that could change how people get tax forms for cryptocurrency. Under this proposal, crypto brokers like Coinbase and Kraken could send forms only online instead of giving paper copies to customers.
“These proposed regulations would generally not require brokers to furnish the 1099-DA statements on paper to any customer that does not consent to receiving these statements electronically.” The agency said in its release, The new rule is not official yet and is open for people to give feedback.
How the new system works
Brokers would not have to give paper forms to clients who trade or sell digital assets if the rule is approved. The forms show important information like gross proceeds and cost basis from crypto trades. This information goes directly to the IRS, which helps the agency see profits and losses automatically. The goal is to make sure everyone reports taxes correctly and to reduce mistakes. The IRS also said that brokers may stop doing business with customers who refuse to accept electronic forms.
The draft regulation, titled “Electronic Provision of Buyer Declarations Regarding Digital Asset Sales by Brokers.”explains how brokers can send notifications to customers online. This means customers do not have to pick between getting a paper form or an online form. Brokers can send all the needed information digitally while the IRS gets the data it needs.
Why this matters for crypto users
This new proposal comes as the IRS uses a new system for reporting crypto transactions. Since this year, brokers must send both gross proceeds and cost basis on Form 1099‑DA. This form helps the IRS track gains and losses for every customer, which can make tax reporting more accurate and easier to manage.
In the past, brokers had to give both paper and online forms. The IRS now wants to use digital methods to make things faster and simpler. The public is invited to comment on this proposal before it is finalized.
The move also follows a rise in IRS warning letters to crypto users. Last year, many received letters reminding them that crypto earnings are taxable and must be reported. With this electronic system, the IRS hopes it will be easier for people to get the right information and report it correctly.
The rule is still a draft and not yet law. Public feedback will help the IRS decide if it should become mandatory for all brokers and crypto users.
Also Read: Coin Center Urges SEC to Prioritize Crypto Rulemaking
