Zinger Key Points
- Delayed tax regulations risk the federal government losing billions in potential revenue.
- Lawmakers warn against crypto lobbyists weakening or repealing the newly proposed regulations.
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Prominent U.S. Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.) penned a letter to Treasury Secretary Janet Yellen and IRS Commissioner Daniel Werfel expressing their concerns over the delay in implementing tax reporting requirements for crypto brokers.
They emphasized the urgency to close the vast crypto tax gap and ensure the industry is aligned with other financial sectors in tax reporting.
The senators pointed to the potential loss of billions in tax revenue for the federal government.
This call to action comes just ahead of Benzinga's Future of Digital Assets conference on Nov. 14, which promises to shed light on such pressing issues facing the rapidly evolving digital asset landscape.
The letter, dated Oct. 10, applauded the proposed regulations but highlighted the significant delay in their effective date, set for 2026.
It referenced the 2021 Infrastructure Investment and Jobs Act, which directed new crypto broker reporting requirements to apply to all tax returns filed starting in 2024.
Also Read: The Can't-Miss Crypto Summit Of 2023: Benzinga's Future Of Digital Assets Conference In NYC
The senators criticized the almost two-year wait to issue rules concerning these requirements, making it unlikely for the administration to comply with Congress's directive.
The senators' concerns stemmed from the estimated loss of tax revenue, with the Joint Committee on Taxation projecting the reporting requirements to generate billions in the first few years.
The letter also warned against the crypto industry's lobbying efforts to weaken or repeal the regulations, urging rapid action to provide clarity for law-abiding taxpayers and to regulate an industry often accused of tax avoidance.
The senators requested a swift response, asking the Treasury Department and IRS for an update by Oct. 24 on efforts to accelerate the implementation of the proposed crypto broker reporting rule.
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