The IRS has granted a two-week extension for public comments on proposed crypto reporting regulations, responding to increased public interest. Find out how this impacts the crypto industry.
In response to the widespread interest and concern generated by its proposed crypto reporting regulations, the Internal Revenue Service (IRS) has decided to extend the comment period by an additional two weeks. The new deadline for submitting comments is November 13, 2023, providing stakeholders with more time to express their opinions.
The proposed regulations aim to define “brokers” in the crypto industry, encompassing trading platforms, payment processors, digital asset-hosted wallet providers, and individuals who redeem digital assets they create.
Notably, individual miners and validators in the crypto industry are exempted from being classified as “brokers.” However, the rules, if adopted, would impose additional compliance requirements on crypto companies, sparking concerns within the industry.
Lawrence Zlatkin, Vice President of Tax at Coinbase, criticized the proposed regulations, describing them as “incomprehensible and unduly burdensome.” He also highlighted concerns about potential data overload for the IRS.
The regulations, introduced in August 2023, aim to improve clarity and compliance in digital asset taxation, treating crypto brokers like securities brokers.
This includes filing information returns and providing payee statements for customers and traders. The Treasury also proposes a new Form 1099-DA to report non-employment income from digital assets.