House Votes to Overturn IRS Crypto Broker Rule, 292-132

The U.S. House of Representatives has voted to overturn an IRS rule that classifies crypto entities, including decentralized finance (DeFi) platforms, as brokers. This rule would have required these entities to collect and report certain taxpayer and transaction information. The vote, which passed with a 292-132 margin, saw bipartisan support and aligns with a similar resolution passed by the U.S. Senate last week.

The resolution, advanced under the Congressional Review Act, aims to nullify the rule finalized during the administration of Joe Biden. Missouri Republican Jason Smith argued that the rule could harm U.S. businesses and stifle innovation, noting that DeFi platforms lack the infrastructure to collect the necessary information from users.

Critics of the resolution, such as Illinois Democrat Danny Davis, pointed out that the rule originated from the 2021 bipartisan Infrastructure Investment and Jobs Act. Davis compared crypto transactions to stock sales, where brokers report proceeds to both the taxpayer and the IRS, leading to higher compliance rates.

North Carolina Republican Tim Moore echoed Smith's concerns, stating that the rule imposes unrealistic burdens on software developers and threatens U.S. leadership in digital asset innovation. Texas Democrat Lloyd Doggett, however, labeled the resolution as "special interest legislation" that could be exploited by tax evaders and criminal elements, potentially adding $4 billion to the national debt.

The House vote came after a separate vote on a continuing resolution to fund the U.S. government through September 30, 2025, which passed with 217 votes in favor and 213 against. This funding resolution is now headed to the Senate for further consideration.

If the Senate approves the resolution again and President Donald Trump signs it, the IRS will be prohibited from implementing a similar rule in the future. This development underscores the ongoing debate over the regulation of crypto assets and the role of DeFi platforms in the financial ecosystem.