Senate Nullifies IRS Crypto Reporting Rule in Bipartisan Vote
1min read The U.S. Senate has passed a resolution to nullify a controversial Internal Revenue Service (IRS) rule that would have required cryptocurrency brokers to report transactions to the agency. The resolution, which passed with a bipartisan vote of 62-37, aims to kill the "unworkable" rule that was set to take effect in 2023.
The irs rule, which was part of the Infrastructure Investment and Jobs Act signed into law in November 2021, would have expanded the definition of a "broker" to include entities facilitating cryptocurrency transactions. This would have required these entities to report certain transactions to the IRS, including the identity of the parties involved and the value of the transactions.
The rule was criticized by the cryptocurrency industry, which argued that it was overly broad and would have burdened small businesses and individual investors with excessive reporting requirements. The industry also argued that the rule would have undermined the privacy and decentralization of cryptocurrencies.
The Senate resolution, introduced by Senator Pat Toomey (R-PA) and co-sponsored by Senator Cynthia Lummis (R-WY), seeks to reverse the IRS rule by amending the Infrastructure Investment and Jobs Act. The resolution defines a "broker" as an entity that receives consideration in connection with a trade or other transaction in a virtual currency, and excludes entities that do not receive such consideration.
The resolution also clarifies that the definition of a "broker" does not include entities that merely provide software or other services to facilitate cryptocurrency transactions. This would exclude many small businesses and individual investors from the reporting requirements.
The passage of the resolution is a significant victory for the cryptocurrency industry, which has been lobbying Congress to amend the IRS rule. The industry has argued that the rule would have stifled innovation and hindered the growth of the cryptocurrency market in the United States.
The resolution now moves to the House of Representatives, where it is expected to face a tougher battle. House Democrats have been supportive of the IRS rule, and some have argued that it is necessary to prevent tax evasion in the cryptocurrency market.
However, the bipartisan support for the resolution in the Senate suggests that there may be enough support in the House to pass the measure. If the resolution is enacted into law, it would significantly amend the IRS rule and provide much-needed 