March 8, 2019

Ernst & Young Joins the US Crypto Taxation Revolution as it Develops New Tools for Cryptocurrency Reporting

As Americans continue to increase their participation in cryptocurrency trading, the government also hurries its policies for enforcing the state's taxation powers. As DataLight shared in the past month, crypto traders from the United States of America form part of the majority of users in various cryptocurrency exchanges. Because of the increasing oversight of the US government on digital coin transactions, auditing and accounting services firms such as Enst & Young would have to step in to address the need for better and more reliable crypto asset reporting.

On March 4, Ernst & Young issued a press release disclosing the availability of a specialized tool called EY Crypto-Asset Accounting and Tax (CAAT) which can be used for calculating taxes and accounting digital assets.

As Marna Ricker, Ernst & Young's Vice Chair of Tax Services asserted, "EY CAAT exemplifies our commitment to exceptional client service in a changing landscape." The new technology can address the needs of their clients, both on individual and institutional levels, to comply with the government's regulation on cryptocurrency taxation and digital coin transaction reporting.

The growing involvement of the American populace in the crypto sphere is also affirmed by Ernst & Young as they proclaim that they witnessed an increase in the number of their clients who engage in bitcoin trading, crypto asset holding, and other crypto transactions.

The EY CAAT tool can source transaction-level information from all major exchanges and consolidate the information from such exchanges to produce an automated report for the easier preparation of IRS tax returns.

Indeed, more and more traditional businesses are starting to adopt the blockchain technology and are now moving towards the development and innovation of new systems to respond to the changing times.