IRS Issues Virtual Currency Guidance

In the first guidance since 2014 on the federal tax consequences of transactions involving virtual currency, the IRS released, on Oct. 8, a revenue ruling on whether transactions involving “hard forks” and “airdrops” result in income under IRC Section 61. The core of the guidance relates to when virtual currency assets are treated as received for federal income tax purposes. The IRS also released updated frequently asked questions related to the federal tax consequences of virtual currency transactions.