Only crypto brokers will need to comply with $1T infrastructure bill’s IRS reporting requirements.
The U.S. Treasury Department is planning to inform cryptocurrency companies concerned about broker reporting requirements in the $1 trillion infrastructure bill that it will not apply the rules too broadly.
The bipartisan bill included provisions intended to raise $28 billion from the cryptocurrency industry. It passed on August 10 without widely sought changes after a single senator objected to compromise language.
Under the legislation as written, the definition of “brokers” facing reporting requirements was so broad that it would likely encompass cryptocurrency miners, proof-of-stake transaction validators, node operators and even software developers.
The industry called these provisions “unworkable,” noting that many of those non-broker “brokers” would not be able to comply — effectively pushing cryptocurrency mining out of the United States.
This doesn’t mean that the IRS will rely on how firms classify themselves, the report added. Instead, the IRS will look at whether firms’ actual activities genuinely classify them as a broker under the tax code.
The clarification is expected as soon as next week, Bloomberg said.
‘Unworkable’ Reporting Requirements
He was part of a bipartisan group of senators that worked out a compromise to amend the bill that would have restricted the reporting requirements to only the actual intermediaries — real brokers.
But the last-minute amendment failed after a single senator, Alabama Republican Richard Shelby, objected — despite later saying that he actually supported the compromise.
Politico judged that the outcome is “Washington wakes up to crypto influence amid infrastructure fight,” adding that the “industry was caught off guard when the Senate targeted it with new tax rules. But it fought back with a vengeance.”