Exploratory Interview Plan v3 + PRA statementlvd

OMB Number 1545-2256

Exploratory Interview + Usability Test into Taxpayer Experiences with Digital Asset Reporting

Paperwork Reduction Act Burden Statement:

Public reporting burden for this collection of information is estimated to average 10 minutes per response. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB control number. Send comments regarding this burden estimate or any other aspect of this collection of information to the Internal Revenue Service, Office of Online Services, User Experience Services, ashley.n.webb2@irs.gov.

Objective:

To understand the workflow and challenges taxpayers face when reporting digital assets and to assess the effectiveness and clarity of guidance provided on the IRS.gov Digital Asset page.

Methodology:

1. Participant Selection (7 users per group):

• User Group A - New Digital Asset Taxpayers:

  • Description: Individuals new to investing or trading in digital assets, facing their first tax reporting cycle with these assets.

• User Group B - Experienced Digital Asset Investors:

  • Description: Taxpayers with multiple years of experience in digital asset investments, familiar with various tax reporting cycles.

• User Group C - Taxpayers with Complex Digital Asset Portfolios:

  • Description: Individuals who have a diverse range of digital assets, including various cryptocurrencies, NFTs, and perhaps involvement in staking or mining.

• User Group D - Taxpayers with Simple Digital Asset Transactions:

  • Description: Individuals who have straightforward digital asset transactions, such as purchasing and selling a single type of digital asset.

2. Key Areas of Focus:

   • Understand the end-to-end process taxpayers follow, from gathering information to filing reports.

   • Identify specific pain points, such as understanding tax obligations, tracking transactions, and using third-party tools.

   • Evaluate how effectively IRS.gov resources guide and inform the reporting process.

3. Interview Structure:

Semi-structured, 60-minute remote interviews tailored to the 4 user segments:

• First-Time DA Filers:

  • What types of digital assets does your portfolio mainly consist of? (Convertible virtual currency and cryptocurrency, NFTs, stablecoins)

  • How did you first learn about your tax obligations for digital assets?

  • What resources do you use to understand how to report your digital assets?

  • Are there any parts of the reporting process that seem particularly confusing or challenging for you?

  • How do you plan on reporting your Digital Asset transactions in this upcoming filing season? (Paper filing, Third-party online service provider (e.g. TurboTax, H&R Block, etc.,) Use an accountant or CPA, Use an in-person tax center, Use a community tax center)

  • Are you using a third-party software to assist in reporting your digital asset transactions?

    • If so, would you be comfortable sharing which software you use?

  • (Using the IRS.gov Digital Asset page as a resource) With your particular use case in mind, tell me what you believe your reporting obligation would be. Use the IRS.gov page as a resource to tell me whether you would need to report digital assets.

  • What improvements or additional information would you like to see regarding digital assets?

• Experienced DA Investors:

  • What types of digital assets does your portfolio mainly consist of (convertible virtual currency and cryptocurrency, NFTs, stablecoins)?

  • Are there specific informational resources you rely on for understanding your tax obligations related to digital assets? If so, what are they?

  • Can you describe whether your approach to reporting digital assets has changed over time?

  • How do you plan on reporting your Digital Asset transactions in this upcoming filing season? (Paper filing, Third-party online service provider (e.g. TurboTax, H&R Block, etc.,) Use an accountant or CPA, Use an in-person tax center, Use a community tax center)

  • Are you using a third-party software to assist in reporting your digital asset transactions? If so, would you be comfortable sharing which software you use?

  • Are there any advanced challenges that you are facing now that you didn't in your earlier experiences?

  • (Using the IRS.gov Digital Asset page as a resource) With your particular use case in mind, tell me what you believe your reporting obligation would be. Use the IRS.gov page as a resource to tell me whether you would need to report digital assets.

  • What improvements or additional information would you like to see regarding digital assets?

• Taxpayers with Complex DA Portfolios:

  • What types of digital assets does your portfolio mainly consist of (convertible virtual currency and cryptocurrency, NFTs, stablecoins)?

  • Are there specific informational resources you rely on for understanding your tax obligations related to digital assets? If so, what are they?

  • How do you plan on reporting your Digital Asset transactions in this upcoming filing season? (Paper filing, Third-party online service provider (e.g. TurboTax, H&R Block, etc.,) Use an accountant or CPA, Use an in-person tax center, Use a community tax center)

  • Describe your process for reporting these digital assets.

  • Are you using a third-party software to assist in reporting your digital asset transactions? If so, would you be comfortable sharing which software you use?

  • What specific challenges do you encounter when reporting various types of digital assets?

  • (Using the IRS.gov Digital Asset page as a resource) With your particular use case in mind, tell me what you believe your reporting obligation would be. Use the IRS.gov page as a resource to tell me whether you would need to report digital assets.

  • What improvements or additional information would you like to see regarding digital assets?

• Taxpayers with Simple DA Transactions:

  • What types of digital assets does your portfolio mainly consist of (convertible virtual currency and cryptocurrency, NFTs, stablecoins)?

  • Are there specific informational resources you rely on for understanding your tax obligations related to digital assets? If so, what are they?

  • How do you plan on reporting your Digital Asset transactions in this upcoming filing season? (Paper filing, Third-party online service provider (e.g. TurboTax, H&R Block, etc.,) Use an accountant or CPA, Use an in-person tax center, Use a community tax center)

  • Describe your process for reporting these digital assets.

  • Are you using a third-party software to assist in reporting your digital asset transactions? If so, would you be comfortable sharing which software you use?

  • (Using the IRS.gov Digital Asset page as a resource) With your particular use case in mind, tell me what you believe your reporting obligation would be. Use the IRS.gov page as a resource to tell me whether you would need to report digital assets.

  • What improvements or additional information would you like to see regarding digital assets?

1. Output:

• A report outlining the findings, including a step-by-step depiction of the taxpayer’s journey, pain points, and recommendations for improving IRS.gov resources and the overall reporting process.