Because if not, that sounds like a massive tax gap that should probably be addressed.
This was clarified in the 2017 tax reform, and the IRS has also said it applies pre-2017 (pre-2017 law is totally worth challenging but its much lower value involved so its history).
I know plenty of people, including their CPAs, that get this wrong. Mostly because they never had to handle taxes themselves before, but they imagine things like only paying taxes when dollars hit their bank account, a wild abstraction that is saying the crypto exchange financial institution is ignorable for taxes and all their onchain data is ignorable for taxes.
(Fun question to upset everyone: suppose you, along with some other people, own an ownership/control token in a DAO. The DAO makes some trades on your behalf. Who incurs what tax liability?)
As governance tokens aren’t equity, and there is nothing to pass through
Either way, there would be enough board seats OR shareholders from different places to dilute ownership to ensure there was no subpart f income
bearer board seats, even better than bearer shares. Crypto is immediately picking up the baton after all that energy was used to jettison bearer shares off the planet over the prior two decades.
Sure, it's dumb to renew my Notes software and have that be a taxable event but...not my problem anymore :)