March 2, 2022 | Cryptocurrency: What's Next for Regulation and Compliance?
As cryptocurrency's popularity has risen, prompting more government attention, compliance has become increasingly difficult for investors and the retail industry. The 2021 Infrastructure Investment and Jobs Act changed the reporting requirements for cryptocurrency, reflecting lawmakers' and tax administrators' increasing discomfort with the implications of its wider use. What are the current reporting requirements, and how will they affect investment decisions and cryptocurrency's future? How will revenue agencies distinguish between legitimate and illegitimate transactions? And how will the IRS increase enforcement and compliance without overly burdening investors, exchanges, and innovation?
ABOUT THE SPEAKERS
President and CEO, Tax Analysts
As the moderator for our Taxing Issues webinars, Cara objectively analyzes issues and asks probing questions that challenge panelists to explain and defend their positions.
When she’s not moderating Taxing Issues webinars, Cara provides strategic oversight for Tax Analysts. She has led efforts to improve the Tax Notes suite of products and to aggressively pursue transparency in the administration of tax systems. Previously, Cara managed the editorial department, including the flagship daily news publications and weekly magazines. She has written for a broad range of tax policy publications, including Tax Notes State, The Tax Adviser, The Hedge Fund Law Report, and The Hill. She regularly speaks at tax conferences and other events, discussing a variety of technical tax issues as well as the need for transparency in tax administration.
Cara has a BA in political science and a BA in international studies from the University of Evansville and a JD from the George Washington University Law School.
Carolyn A. Schenck is national fraud counsel and assistant division counsel (international) in the IRS Office of Chief Counsel, Small Business/Self-Employed Division. In her role as national fraud counsel, Carolyn works closely with the Office of Fraud Enforcement to provide advice on the program’s design, development, and delivery of major activities to detect and deter fraud. Carolyn serves as the principal legal adviser and contact point on international and offshore tax and foreign bank account reporting matters. She has litigated numerous cases in Tax Court on behalf of the IRS. She has been an adjunct professor at Pepperdine University School of Law for Honors Appellate Advocacy. Before joining the IRS, she was an attorney for the SEC Division of Enforcement. She also worked for Chief Judge Alex Kozinski of the Ninth Circuit and Chief Judge H. Robert Mayer of the Federal Circuit.
Mike Fiore is an area counsel with the IRS Office of Chief Counsel, Small Business/Self-Employed Division. As area counsel, Mike is responsible for supervising the delivery of legal services to the IRS and managing the litigation program in New England, New York, and New Jersey. He also oversees the SB/SE Division’s virtual currency program. Previously, Mike was a deputy area counsel, associate area counsel, and senior attorney, all with SB/SE in Boston. He has detailed as director of field operations for international individual compliance, special counsel abusive tax avoidance transactions, and special counsel to deputy chief counsel (operations). Before joining chief counsel, he was in private practice handling corporate and tax matters for domestic and foreign companies. Mike received a JD and LLM in taxation from Boston University School of Law and a BA from Providence College.
Lawrence Zlatkin is the Vice President, Tax at Coinbase, the leading cryptocurrency exchange in the US and a global market leader. He joined Coinbase in January 2020 and is an active proponent for clarity and dialogue in the tax regulation of the digital asset economy. Lawrence regularly participates in tax policy discussions regarding crypto and lectures frequently. Lawrence took on his role at Coinbase following a long standing career as a senior tax executive at the General Electric Company and as a tax lawyer at a number of global US law firms. He is a graduate of the University of Chicago Law School (JD) and McGill University (BA) in his native Canada.
Lisa Zarlenga represents public and private companies on federal income taxation issues, with a focus on tax policy issues with respect to tax legislation and Treasury guidance as well as on corporate transactional and planning matters. Drawing on her experience as Tax Legislative Counsel at the US Treasury Department’s Office of Tax Policy, Lisa marries substantive tax knowledge with strong relationships at Treasury and first-hand insights on the guidance and other processes at Treasury. She helps clients advocate for and resolve tax policy issues before the Treasury Department and IRS involving proposed and pending regulations and other administrative guidance, and before Congress involving legislation.
Lisa also advises clients on structuring tax-free and taxable acquisitions and dispositions, tax-free spin-offs, and internal restructurings, including providing opinion letters and seeking advance rulings from the IRS. She also assists clients in restructuring financially troubled businesses and advises on the special rules governing consolidated groups.
Lisa has combined her policy and transactional backgrounds to advise clients on certain specialized tax issues, such as blockchain and digital currency and qualified opportunity zones. She advises clients on conducting digital currency transactions and conversions, token offerings, and different investment and entity structures. Her experience includes advising a coalition of the leading companies in the blockchain space that was engaging directly with the IRS and policymakers to develop workable policies at an industry-wide level. With respect to qualified opportunity zones, Lisa has advised investors and funds on the intricate tax rules that govern the investments and structured those investments. She has also assisted clients during the rulemaking process, including preparing comment letters and meeting with policymakers.
As Tax Legislative Counsel at the Treasury Department, Lisa advised Treasury's Assistant Secretary for Tax Policy on a broad range of domestic tax policy issues, including corporate, partnership, healthcare, tax-exempt organizations, energy, income tax accounting, estate and gift, and procedure and administration. She oversaw preparation of regulations and other administrative guidance implementing the Internal Revenue Code and the president’s annual revenue proposals in these areas.
Abraham Sutherland was the U.S. Department of State’s rule of law adviser in northeast Afghanistan’s Kunar Province, near the Pakistan border, from 2009 to 2012. He served with five successive Navy-led Provincial Reconstruction Teams and three Army brigade combat teams, planning and participating in more than 450 missions from a forward artillery base in one of the conflict’s most challenging regions.
He received the Army’s Superior Civilian Service Award, the State Department’s Superior Honor Award, and recognition from the Afghan Supreme Court and Attorney General for his contributions to Kunar’s justice system. Sutherland’s approach to rule of law efforts emphasizes publicity, transparency and incentive structures. More than 100 public, media-covered criminal trials were held in Kunar Province during his tenure, the first of their kind in Afghanistan. He remains an adviser to the Afghan-run NGO he helped found. The NGO promotes public awareness and oversight of Kunar’s justice institutions and provides defense attorneys to criminal defendants.
Sutherland's research interests include the regulation and taxation of cryptocurrency. He has advocated for the clarification of the income taxation policy that applies to "block rewards," which are the new cryptocurrency tokens created to incentivize people to help maintain such networks by validating transactions. He argues that, contrary to the approach suggested in 2014 IRS guidance, such tokens should not be taxed when first acquired. New property is not taxable income in the hands of its creator, and Sutherland argues this treatment should also apply to new cryptocurrency tokens.
He is also the director of the project development company Saker Group. The company seeks solutions to development challenges in least-developed countries and frontier markets by applying strategies and principles drawn from law and economics. Saker Group is currently focused on energy infrastructure and other development projects in Union of Comoros, East Africa.
In law school Sutherland was a member of the California Law Review and was named to the Order of the Coif. He began his career at O’Melveny & Myers in Washington, D.C., and clerked for Judge David B. Sentelle on the U.S. Court of Appeals for the D.C. Circuit. He served in the White House as a deputy associate counsel during the George W. Bush administration.