Bill Hughes, the regulatory expert at Consensys, has revealed that the IRS is enforcing new regulations that will require crypto holders to report their transactions on a wallet-by-wallet basis, posing challenges for users with multiple wallets.
Crypto Tax Regulations Become More Complex with IRS Per-Wallet Tracking
Despite differing views on cryptocurrency between the Trump and Biden administrations, the IRS is moving forward with stringent tax enforcement measures. Bill Hughes, the Senior Counsel and Director of Global Regulatory Matters at Consensys, recently expressed concerns over the IRS’s latest bulletin on crypto tax filings.
In a social media post, Hughes highlighted Revenue Procedure 2024-28 issued by the IRS last year, outlining extensive reporting requirements for cryptocurrency holders when filing their taxes.
Describing it as a “new level of tax complexity” for the crypto industry, Hughes warned:
Starting in April 2026, individuals will need to track the cost basis of their assets on a wallet-specific basis, rather than aggregating across all wallets.
The IRS directive mandates that taxpayers maintain detailed records to show the total number of digital asset units in each wallet or account they hold.
This new procedure, implemented this year, has the potential to disrupt the crypto tax landscape in the U.S., leading to confusion among traders and potentially inaccurate tax filings.
“Many taxpayers may unknowingly file incorrect tax returns,” Hughes cautioned, urging users to seek professional guidance for accurate tax compliance.
While attributing the challenging regulations to the Biden Administration, Hughes pointed out that the current administration has the authority to revise the procedures, as they were not legislated by Congress.
“The Biden Admin’s crypto tax policy continues to present challenges,” Hughes remarked, emphasizing the need for clarity and guidance in navigating these intricate tax requirements.