Tax season pulse check — ChatGPT, 1099-K and digital assets

Another busy season is upon the profession. With several tumultuous tax seasons in the recent past, the 2023 tax filing season is shaping up to be relatively normal, a welcomed changed for taxpayers, tax practitioners and the IRS. Normalcy doesn't exactly equate to status quo, however. There are new rules, new guidance releases as well as established items with newfound scrutiny that practitioners and taxpayers need to be aware of.

On this Tax Section Odyssey episode, April Walker, CPA, CGMA, Lead Manager — Tax Practice & Ethics, AICPA & CIMA, conducts a tax season pulse check with Annette Nellen, CPA, CGMA, Esq., Tax Professor — MST Program at San Jose State University, and a past Chair of the AICPA Tax Executive Committee, touching on some key topics in the tax arena that are currently noteworthy.

What you'll learn in this episode

• Latest in virtual currency/digital assets and the most recent AICPA comment letter (1.02)
• Confusion around "worthless" virtual currency (4.17)
• Practical discussion on the Form 1099-K and the transition year (13.14)
• Change in the bonus depreciation percentage for 2023 (23.31)
• Reminders about the accumulated earnings tax and personal holding company tax (25.18)
• ChatGPT (29.32)
• A page from Annette's travel journal (34.02)

Related resources

• AICPA comments for IRS consideration on AICPA proposed FAQs on the new digital assets question on the 2022 Form 1040 — AICPA suggested for IRS consideration proposed frequently asked questions (FAQs) to assist taxpayers in responding to the new digital asset question on the 2022 Form 1040, U.S. Individual Income Tax Return and discussed in the instructions. Also see AICPA press release on these comments.
• AICPA tax season library — With constant changes to the tax landscape, being prepared for tax season is critical for success. Set yourself up for a smoother filing season by tapping into the wealth of AICPA and Tax Section resources.
• ChatGPT and the tax law — Official blog post by Professor Nellen on the 21st Century Taxation website.
• Chief Counsel Advice (CCA) 202302011 — Addresses the applicability of Sec. 165 to cryptocurrency that has declined in value.
• Frequently asked questions about Form 1099-K – Links to frequently asked questions about the Form 1099-K including general information, reporting requirements and filing the form.
• Internal Revenue Manual (IRM) 4.10.13.2 – IRM on accumulated earnings Tax (IRC 531)
• IRS Practice & Procedure — Browse the latest resources to help with IRS tax matters including news, guidance and tools.
• Reminder to answer the digital asset question on the 2022 tax return — In IR-2023-12, Jan. 24, 2023, the IRS reminded taxpayers that they must again answer a digital asset question and report all digital asset-related income when they file their 2022 federal income tax return, as they did for fiscal year 2021. The term "digital assets" has replaced "virtual currencies," a term used in previous years.
• U.S. Federal Tax law Hierarchy — Understand the weight of taxing authorities from highest to lowest for use in determining whether a source can be relied upon for a tax position.

Keep your finger on the pulse of the dynamic and evolving tax landscape with insights from tax thought leaders in the AICPA Tax Section. The Tax Section Odyssey podcast includes a digest of tax developments, trending issues and practice management tips that you need to be aware of to elevate your professional development and your firm practices.

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