Who Pays Tax on Cryptos? Congress Will Decide
When you hear the word “infrastructure,” you probably think of roads, bridges and buildings.
But the White House’s proposed infrastructure bill, which is currently making its way through Congress, expands the definition to include digital infrastructure — specifically, cryptocurrencies and decentralized networks.
The infrastructure bill originally required traders, miners and networks to report capital gains and losses from crypto transactions on their yearly taxes.
Luckily for crypto exchanges, the bill was amended last weekend.
According to MarketWatch, the bill no longer requires non-custodial or decentralized networks to report customers’ crypto transactions.
It would still place this burden on miners, stakers and other market participants. But that may be changing too.
Earlier this week, a bipartisan group of pro-crypto senators filed a new amendment to exempt crypto miners and service providers from the tax requirements levied on crypto brokers.
Democratic Sen. Ron Wyden of Oregon, one of the amendment’s supporters, said that “investors failing to pay tax they owe through cryptocurrency is a real problem.”
But he noted that the broad-based bill would require information from groups that would not be able to comply with the requirements.
To address this issue, the group’s amendment would “clarify that ‘brokers’ mean only those persons who conduct transactions on exchanges where consumers buy, sell and trade digital assets.”
That means miners, stakers and companies that sell digital asset storage wouldn’t have to report customer or user transactions. The new amendment would also exempt developers whose users aren’t their direct customers.
MarketWatch predicts that Congress will consider the amendment in the coming days, with a vote on the whole infrastructure package expected as early as next week.
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The Smart Profits Daily Team