Definition ∞ Information returns are tax documents filed with a tax authority to report certain types of income, payments, or transactions, rather than to calculate a tax liability directly. In the digital asset space, these forms typically report sales, exchanges, and other dispositions of cryptocurrencies. They assist tax authorities in verifying income and capital gains reported by taxpayers. These returns are a key tool for tax compliance.
Context ∞ News frequently covers the expansion of information return requirements for digital asset intermediaries, such as cryptocurrency exchanges. Governments are increasingly mandating these reports to close tax gaps and ensure compliance in the rapidly evolving digital asset market. The standardization and implementation of these reporting mechanisms are significant regulatory developments impacting both platforms and individual investors.
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