Two United States senators are introducing legislation to amend the crypto provision of the infrastructure bill that President Biden just signed into law.
Reaching across the aisle, Democrat Ron Wyden and Republican Cynthia Lummis seek to revise the new information-reporting rules imposed on the digital asset space.
The proposed amendment intends “to revise the rules of construction applicable to information reporting requirements imposed on brokers with respect to digital assets, and for other purposes.”
As a press release from Sen. Lummis explains,
“Under current law, those who are involved in digital asset mining or staking, providing digital asset hardware or software wallets, or developing digital asset protocols may fall under the definition of ‘broker’ for tax purposes and would be subject to certain Internal Revenue Service (IRS) reporting requirements.
The senators’ bill would clarify that the ‘broker’ definition excludes miners and stakers, as well as wallet providers and developers, and would ensure that only those digital asset intermediaries that actually have access to material customer information are required to report to the IRS.”
Senator Wyden says it is “critically important to protect innovation in the digital asset space.”
“Our bill makes clear that the new reporting requirements do not apply to individuals developing blockchain technology and wallets. This will protect American innovation while at the same time ensuring those who buy and sell cryptocurrency pay the taxes they already owe.”
Lummis, who has been a vocal advocate of cryptos as well as a buyer of Bitcoin (BTC), says digital assets are now a part of the financial system and today’s decisions will have long-term effects.
“We need to be fostering innovation, not stifling it, if we are going to maintain America’s position as the global financial leader. I’m proud to introduce this bipartisan bill to ensure that our tax system reflects the realities of digital assets and distributed ledger technology.”
President Biden signed the Infrastructure Investment and Jobs Act/Bipartisan Infrastructure Framework (HR 3684) bill into law on Tuesday.
Currently, Section 80603 of the law says,
“Return Requirement for Certain Transfers of Digital Assets Not Otherwise Subject to Reporting.
Any broker, with respect to any transfer (which is not part of a sale or exchange executed by such broker) during a calendar year of covered security which is a digital asset from an account maintained by such broker to an account which is not maintained by, or an address not associated with, a person that such broker knows or has reason to know is also a broker, shall make a return for such calendar year, in such form as determined by the Secretary, showing the information otherwise required to be furnished with respect to transfers subject to subsection (a).'”
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