ConsenSys, the owner of Ethereum wallet MetaMask, has clarified that it does not collect taxes from cryptocurrency users. The company made this statement in response to rumors circulating in the crypto community that MetaMask and ConsenSys’s terms of service indicated that certain parties were required to pay taxes, and that MetaMask could freeze user funds for tax-related reasons.
No Taxes Collected on Crypto Transactions
ConsenSys took to Twitter to clarify that MetaMask does not collect taxes on crypto transactions, and that it has not made any changes to its terms to do so. The company clarified that it only collects sales taxes on certain paid services, such as subscriptions to the Ethereum API Infura that are paid via credit card. Additionally, it stated that tax-related terms do not apply to MetaMask and other products without sales tax.
Crypto Investors Still Required to Pay Taxes
Although MetaMask users do not need to pay sales tax, cryptocurrency investors are required to report and pay taxes on capital gains in most jurisdictions. Many major exchanges, including Coinbase and Binance.US, provide user trading activity to the U.S. Internal Revenue Service (IRS) and offer tax forms that clients can use when they file their own tax returns.
User Information and Taxes
It is unclear whether MetaMask or ConsenSys have ever provided user information to the IRS. However, both companies have acknowledged that users should pay taxes. While rumors about MetaMask freezing user funds for tax-related reasons are unfounded, it is important for cryptocurrency investors to stay informed about tax laws in their jurisdictions and to report any capital gains accordingly.
ConsenSys has clarified that MetaMask does not collect taxes on crypto transactions, and that the rumors circulating in the crypto community about tax-related issues are false. However, it is important for cryptocurrency investors to stay informed about tax laws in their jurisdictions and to report any capital gains accordingly.
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