The US crypto industry is on the verge of significant legal gains as the US Treasury Department plans to exempt cryptocurrency miners and other “contributing parties” from tax reporting rules.
In a letter to a group of senators on Friday, the US Treasury Department indicated that it plans to exempt crypto-miners and other market participants from rules that require crypto-brokers to share customers’ transaction data with the Internal Revenue Service.
“We appreciate the Treasury Department’s assurances that crypto miners, speculators and those who sell wallet hardware and software are not subject to their tax reporting obligations,” said Senator Rob Portman, who announced the news on Twitter.
In the letter, Assistant Secretary of Finance for Legislative Affairs Jonathan Davidson stated that the department’s position is that “assisting parties without access to information that is useful to the IRS are not meant to be hijacked by intermediate reporting requirements.”
Davidson also stressed that crypto auditors “are unlikely to know if a transaction is part of a sale,” and those involved in providing services related to hardware or software crypto wallets “do not act as an intermediary.”
The Ministry of Finance will also consider “the extent to which it is necessary to treat other parties in the digital asset market, such as centralized exchanges, often referred to as decentralized exchanges and peer-to-peer exchanges, as intermediaries,” the letter states.
Bloomberg reported that the Treasury Department plans to publish proposed rules that include its position on the definition of a broker.
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As previously reported, US President Joe Biden signed a trillion-dollar infrastructure bill in mid-November 2021 that requires crypto-market participants to report all digital asset transactions over $ 10,000 to the IRS.
Several senators, including Pat Tomei, Ron Wyden and Cynthia Loomis, later called on the Treasury Department to clarify the definition of an intermediary in the Infrastructure Act in December, and planned to pass legislation with it. A group of House Democrats also supported a similar initiative in November.