Recently, the U.S. House of Representatives voted to pass a bipartisan infrastructure bill that includes a controversial cryptocurrency tax filing requirement.On Friday evening, the House of Representatives passed the bill with at least 218 votes, fulfilling a key priority of the Biden administration in the dispute over whether the Democratic-led supporting bill will also move forward.
It is reported that the U.S. Senate initially passed the bill in August, after legislators vetoed any attempts to modify cryptocurrency terms.
The bill is now handed over to US President Joe Biden for signing.
The cryptocurrency industry has expressed concern about the tax reporting requirements in the bill, which seeks to expand the IRS’s definition of brokers. This reporting requirement will enable all brokers to report transactions in accordance with current tax laws.
But industry supporters worry that the definition will be too broad.
The bill included another amendment to Article 6050I of the Tax Law, which also aroused fear in the cryptocurrency industry. This law was enacted nearly 40 years ago and applies to face-to-face cash transactions of more than US$10,000. It basically requires the recipient to verify the sender’s personal information and record their social security number, the nature of the transaction, and other information. Report the transaction status to the government within 15 days.
Unlike other violations of the tax law, violation of 6050I is a felony. Some lawyers pointed out that if it applies to cryptocurrencies and other digital assets such as NFTs, it is almost impossible to comply with the law.
The counterattack against this clause hindered the passage of the bill in the Senate, and the infrastructure bill was introduced in the Senate, which gave the industry an opportunity to promote amendments to the language. However, the Senate finally passed the bill without passing any amendments.
The Ministry of Finance still needs to explain how it plans to interpret the bill and issue guidance to explain how companies or other entities must comply with the bill.
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