Bill Hughes, in charge of regulatory matters at Consensys, explained that starting this year crypto holders will be required to report their transactions on a wallet-by-wallet basis, making it more complex for users who have multiple wallets.
Crypto Taxes Get Harder to File as IRS Enforces Per-Wallet Tracking Procedures
While Trump has a different vision of crypto than the previous administration, some guidance regarding tax enforcement and procedures remains. Bill Hughes, Senior Counsel and Director of Global Regulatory Matters at Consensys, recently raised concerns about an Internal Revenue Service (IRS) bulletin related to filing crypto taxes.
On social media, Hughes stated that the IRS issued Revenue Procedure 2024-28 last year, establishing strong reporting duties for cryptocurrency holders that will have to declare taxes in a very detailed way.
Warning about a “new level of tax hell” for the crypto industry, he declared:
Starting in April 2026, you will have to track your cost basis for your assets ON A WALLET BASIS rather than universally across all your wallets.
Specifically, the document establishes that taxpayers must be able to “identify and maintain records sufficient to show the total number of remaining digital asset units in each of the wallets or accounts held by the taxpayer.”
The procedure, which was implemented this year, can potentially disrupt the crypto tax arena in the U.S., as confused traders could present their transactions differently, affecting the validity of their tax statements.
“A lot of people’s taxes are going to be filed with simply a near-zero chance of being correct,” Hughes claimed, raising alarms about possible sanctions affecting these procedures and recommending users get professional advice for these tasks.
Hughes blamed the Biden Administration for this kind of guidance, which creates difficulties for the IRS and crypto users. Nonetheless, the procedure can be updated by the current administration, as it was not produced by any congressional initiative.
“Once again, a big shout out and thank you to the Biden Admin and its crypto tax policy – truly a gift that keeps on giving,” he concluded.