""I don't track it myself," he says. "That seems like a lot of work.""
""The offshore exchanges are harder," Meininger says."
"The IRS paid Palantir $1.8 million to improve a custom tool designed to flag 'high-value' auditing cases."
"The ambiguity around prediction markets and taxes resembles the confusion around how to report cryptocurrency profits at the beginning of the blockchain boom."
Traders in prediction markets must meticulously track their earnings on a per session basis, complicating tax reporting. Many rely on tax documents from platforms like Kalshi and consult accountants for guidance. US traders using platforms like Polymarket face additional challenges due to the lack of tax documentation and legal restrictions. The IRS is modernizing its auditing strategies, which may increase scrutiny on these traders. The situation mirrors the early confusion surrounding cryptocurrency tax reporting, which has evolved over the years.
Read at Ars Technica
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