Cryptocurrency Companies Receive Relief From Heavy Taxes with New IRS Guidelines

Cryptocurrency companies, particularly larger publicly traded firms like Coinbase, Microstrategy, Riot Platforms, Marathon, Circle, and Paxos, have experienced significant tax challenges due to the Corporate Alternative Minimum Tax (CAMT) rule. Introduced in 2022 under the Inflation Reduction Act, this policy imposed a 15% tax burden on these companies’ adjusted financial statement income (AFSI) quarterly, even though cryptocurrencies often involve unrealized gains and losses. This created an unfavorable situation for these firms as much of their four-year cycle involved coping with unrealized losses, leading to substantial tax burdens.