Crypto miners don’t have to report to the IRS, confirms US Treasury
The US Treasury said that crypto miners and wallet operators aren’t required to report their income to the IRS, and they’re working on new and appropriate regulations.
In mid-November 2021, US President Joe Biden signed a $1 trillion infrastructure bill, forcing crypto market players to register every digital asset transaction costing $10,000 to the Internal Revenue Service (IRS).
Several senators, including Pat Toomey, Ron Wyden, and Cynthia Lummis, encouraged the Treasury to clarify the term of broker under the infrastructure package in December to introduce related legislation. In November, a bipartisan group of House Democrats endorsed a similar plan.
The cryptocurrency sector in the United States is on the verge of a significant legal victory, as the Treasury Department intends to exclude crypto miners and other “ancillary parties” from tax reporting requirements.
The US Treasury indicated Friday in a letter to a group of senators that it intends to exclude cryptocurrency miners, stakers, and other market players from laws requiring crypto brokers to provide data on their customers’ transactions with the Internal Revenue Service.
What the judicials have in mind!
Senator Rob Portman tweeted, “Appreciate the Treasury Department affirming that crypto miners, stakers, and those who sell hardware and software for wallets are not subject to tax reporting obligations.”
Treasury Assistant Secretary for Legislative Affairs Jonathan Davidson stated in the letter that the department’s view is as follows: “ancillary parties who cannot get access to information that is useful to the IRS are not intended to be captured by the reporting requirements for brokers.”
In defense of crypto validators, Davidson says, “are not likely to know whether a transaction is part of a sale,” while companies engaged in the provision of services relating to hardware or software-based cryptocurrency wallets “are not carrying out broker activities.”
The Treasury will also assess “the extent to which other parties in the digital asset market, such as centralized exchanges and those often described as decentralized exchanges and peer-to-peer exchanges, should be treated as brokers,” according to the letter.