Nullifies the IRS rule on digital asset sale reporting by brokers.
Mike Carey
Representative
OH-15
This bill nullifies an IRS rule concerning gross proceeds reporting by brokers involved in digital asset sales. By disapproving the rule, the bill prevents the IRS from implementing new reporting requirements for digital asset transactions. This action aims to block increased scrutiny and reporting obligations on brokers facilitating digital asset sales.
| Party | Total Votes | Yes | No | Did Not Vote |
|---|---|---|---|---|
Democrat | 259 | 93 | 158 | 8 |
Republican | 271 | 269 | 0 | 2 |
Independent | 2 | 0 | 2 | 0 |
Resolution Blocks IRS Rule Requiring Brokers to Report Digital Asset Sales Data
This joint resolution takes aim at a specific Internal Revenue Service (IRS) rule concerning how brokers report sales of digital assets, like cryptocurrencies. If enacted, it would officially disapprove the rule titled "Gross Proceeds Reporting by Brokers That Regularly Provide Services Effectuating Digital Asset Sales" (found in 89 Fed. Reg. 106928), effectively stopping it from having any legal force.
Unplugging the Tax Man's Crypto Tracker
The IRS rule this resolution targets was designed to bring digital asset reporting more in line with how traditional assets, like stocks, are handled. Currently, when you sell stock, your broker sends you (and the IRS) a Form 1099-B detailing the gross proceeds. The disapproved rule aimed to create a similar requirement for brokers facilitating digital asset sales, mandating they report the gross proceeds from these transactions. By blocking this rule, the resolution prevents this specific federal reporting requirement from being imposed on digital asset brokers.
What This Means for Your Crypto Taxes (and Everyone Else's)
So, what's the real-world ripple effect? For digital asset brokers, this means avoiding the compliance costs and administrative tasks associated with implementing this particular reporting system. For individuals trading digital assets, the picture is mixed. While you still owe taxes on any profits you make, you won't necessarily receive a standardized form from your broker detailing the gross proceeds under this specific (now blocked) rule. This lack of standardized reporting could make accurately calculating and reporting your own gains and losses more complex, requiring diligent personal record-keeping.
From the IRS's perspective, losing this rule means losing a potentially significant tool for automatically tracking digital asset transactions and verifying tax compliance. Without this specific broker reporting, identifying unreported gains becomes more challenging, potentially widening the 'tax gap' – the difference between taxes legally owed and taxes actually collected. This resolution essentially prioritizes reducing the regulatory burden on brokers over enhancing the IRS's ability to automatically track these specific transactions for tax purposes.