Federal law requires taxpayers to report digital asset transactions and pay tax accordingly (no reporting is required for just holding digital assets). For example, if a business accepts digital assets as payment for goods or services, the gain (or loss) on the transaction must be reported (digital assets are property, not currency, for federal tax purposes). Now, Illinois has enacted the Digital Asset Tax Act (DATA) to become the first state to impose a digital asset tax, effective January 1, 2027. The tax is 0.2% of the value of digital assets exchanged, transferred, or stored by customers in the state. Brokers (including out-of-state brokers that have certain in-state gross receipts) are responsible for collecting and remitting the tax. Will other states follow suit? #IdeaoftheDay
