Tax experts weigh in on how the IRS will decide if NFTs are collectibles

Cryptocurrency is still in its infancy and non-fungible tokens (NFTs) are an even newer asset class, only coming to mainstream notice in 2017 with the launch of CryptoPunks. So it’s no surprise that historic policies and laws are still catching up to the new realities of digital asset ownership.
Case in point: Last week, the U.S. Internal Revenue Service (IRS) published a document requesting comment and proposing new guidance on the tax treatment of NFTs. The statement, Notice 2023-27, questions whether NFTs should be classified the same as traditionally accepted collectibles like stamps, physical artworks and fine wine. It also leaves open to interpretation whether digital art can be included in the category of collectibles, or whether it needs a new category of its own.