The U.S. Treasury Department and the Internal Revenue Service (IRS) are jointly proposing new tax rules for the digital asset industry.
In a new publication, the Treasury Department and the IRS are proposing that payment platforms, wallet providers, and trading companies dealing with crypto assets file tax returns on certain sales or exchange transactions.
The proposal also asks real estate brokers to file tax information on virtual currencies they receive during transactions.
“Based on existing authority and on changes to applicable tax law by the Infrastructure Investment and Jobs Act, these proposed regulations would require brokers, including digital asset trading platforms, digital asset payment processors, and certain digital asset-hosted wallets, to submit a file return information and provide beneficiary statements regarding the dispositions of digital assets involved for clients in certain sales or exchange transactions.
This proposed regulation would also require real estate reporting agents, who are treated as brokers with respect to reportable real estate transactions, to include in the information returns filed and beneficiary statements provided the fair market value of the consideration for digital assets received by real estate sellers in reportable real estate. estate transactions.”
According to a Treasury Department press release, if enacted, the proposed rules would apply to the sale and exchange of crypto assets by 2025 and are estimated to generate approximately $28 billion in revenue for the federal government over a period of ten years.
The proposed rules have been criticized by Republican Representative Patrick McHenry of North Carolina, the chairman of the House Financial Services Committee. According to McHenry, the proposal is simply a new way for the Biden administration to handle the crypto industry.
“The Biden administration must end its efforts to destroy the digital asset ecosystem in the US and work with Congress to finally set clear traffic rules for this sector.
I look forward to advancing my two-pronged solution – the Keep Innovation in America Act – to resolve these misleading reporting requirements, protect the privacy of market participants and ensure that the digital asset ecosystem can flourish here in the US.”
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