The Latest IRS, FATCA and CRS News for July 2025

07/31/25
10 Min Read Time

Key Updates:

Time flies when you’re staying compliant! This month marks two incredible years of our Comply Connect – your go-to for all things tax, tech, and sometimes, a dash of sass. Thanks for sticking with us through regulation rundowns, acronym overload, and everything in between. Most of all, thank you for being a part of the Comply community. Here’s to many more compliant years ahead!

Comply Exchange x Ledgible Partnership

On July 29, Comply Exchange and Ledgible announced a strategic partnership combining forces to help crypto platforms master tax compliance. As crypto regulations tighten and reporting complexity increases, our unified solution cuts through the confusion. Together, we’re bringing clarity to crypto tax reporting so platforms can stay compliant and focused on growth.

IRS & Treasury Updates July 2025:

One Big Beautiful Bill

The One Big Beautiful Bill Act (OBBBA) was passed into law July 4, 2025. Here are some highlights as it impacts the information reporting and withholding world:

Section 899, which would have imposed retaliatory withholding tax increases (5% per year, capped at 20% in the House, 15% in the Senate) on U.S.-source payments to residents of countries deemed to impose “unfair foreign taxes” (e.g., DSTs, UTPR), was removed from the bill following a G7 agreement with the Treasury.
For payments made after December 31, 2025 (filed for 2026 returns), the reporting threshold for Forms 1099-MISC and 1099-NEC increases from $600 to $2,000 aggregated per payee per year.
The limited de minimis exception for Forms 1099-K is reinstated, requiring reporting only if payments are both over $20,000 total and 200+ transactions in a calendar year. This reinstatement is retroactive to 2022, and backup withholding for 1099‑K is aligned with those thresholds effective for the 2025 reporting year.
Backup withholding changes mirror the new reporting thresholds, meaning that if a payee fails to provide a correct TIN (or triggers other withholding requirements), the threshold at which payers must begin withholding will also rise.

GENIUS Act: Federal Stablecoin Regulation

On July 18, 2025, President Trump signed the GENIUS Act into law, establishing the U.S.’s first federal framework for stablecoins. It requires issuers to maintain 1:1 asset backing and imposes new transparency rules under the Bank Secrecy Act.

IRS: Publication 1179

On July 24, 2025, the IRS posted an updated Publication 1179, General Rules and Specifications for Substitute Forms 1096, 1098, 1099, 5498, and Certain Other Information Returns.

July 2025 FATCA, CRS and CARF Headlines:

CARF XML Schema

On July 30, the OECD released updated technical guidance and a new CARF XML Schema (v1.4) user guide to standardize tax authority feedback on digital asset data reporting, improving clarity and data quality.

DAC 8 Developments

EU DAC 8 mandates crypto‑asset service providers report cross-border digital asset transactions starting January 1, 2026, with the first reporting cycle beginning in 2027. Member states must transpose by December 31, 2025.

On July 4, Germany launched a public consultation on its DAC8 and CARF implementing bill, requiring crypto service providers to comply with both frameworks and complete due diligence on existing users by January 1, 2027.
On July 24, Luxembourg’s Cabinet approved draft laws implementing both DAC 8 and CARF obligations, aligning domestic law with OECD standards.

Bahamas: AEOI Reporting for Undocumented Accounts

On July 11, 2025, the Competent Authority Ministry of Finance of the Bahamas published a notice regarding undocumented accounts. Per this notice, effective immediately, Reporting Financial Institutions (RFIs) are required to report undocumented accounts.

An undocumented account arises when a RFI is unable to obtain information from a preexisting individual account holder in order to establish tax residence. Entity accounts or new individual accounts cannot be classified as undocumented accounts.

The notice outlines due diligence obligations and reporting requirements for undocumented accounts. The Competent Authority will conduct intelligence activities with respect to the number of undocumented accounts reported and will keep a list of RFIs that have reported undocumented accounts.

The Competent Authority, through the Designated Supervisory Authorities, may conduct audit checks on the RFIs to ensure that they have correctly understood the criteria for an account to reported as undocumented and have conducted the due diligence procedures as required.

Germany: FATCA/CRS Reporting Moves Exclusively to BZSt Portal

FATCA and CRS data for the 2024 reporting period must be submitted by July 31, 2025. This is the final year institutions can use their ELSTER (“My BOP”) and ELMA; access will continue until November 2025 for late submissions only.

Starting with the 2025 reporting year, Germany will fully retire the ELSTER (“My BOP”) portal, together with the legacy ELMA mass data interface, and require all FATCA and CRS files to be submitted exclusively via the new BZSt online.portal.

Guernsey: Notice 2025/1

The States of Guernsey Revenue Service published Compliance Information Notice 2025/1. The purpose of the notice is to provide information regarding the Common Reporting Standard (CRS) and the Crypto Asset Reporting Framework (CARF). Under this notice, Guernsey has noted two key deliverables that are currently in progress:

Legal framework is currently being drafted to implement CARF into Guernsey law.
Additional functionality is to be added to IGOR in readiness for the first reporting schedule date of June 2027 to report 2026 information.

Ireland: Updated Filing Guidelines for DAC2-Common Reporting Standard (CRS)

The Office of the Revenue Commissioners of Ireland updated the Filing Guidelines for DAC2-Common Reporting Standard (CRS) Part 38-03-26. The latest guidelines are updated to include a new Section 7.5, XML Schema Version 3.0. In October 2024, the OECD published CRS XML Schema Version 3.0 and User Guide 4.0, which will come into effect January 1, 2027, and is to be used from that date forward.

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A Message From Our CEO

Our recent partnership with Ledgible and participation in Sovos’s FY25 Sales Kickoff this month reinforce the power of strategic collaboration. By aligning with industry leaders who share our vision, we’re not just expanding our reach, we’re strengthening the very foundation of our solution. These partnerships enable us to deliver smarter, more integrated compliance experiences that scale with our clients’ evolving needs.

As global regulations continue to evolve, from CARF and DAC8 to 1099-DA and beyond, the need for adaptable, forward-thinking solutions has never been greater. Strategic partnerships like these ensure we’re not only keeping pace with regulatory change but leading the way in helping our clients stay compliant with confidence through complete, connected solutions.