Last Updated: January 18, 2022
CoinDesk has discovered that there are last-minute additions to the Infrastructure Plan, in which US Senators propose to raise $28 billion through expanded cryptocurrency taxation.
The crypto measures were abruptly added to the plan on July 28, when Republicans and Democrats agreed to this measure after weeks of going back and forth. The plan is to use the money from crypto taxes to support the $550 billion investment fund for electricity and transportation infrastructure.
The document stated: “The provision includes updating the definition of broker to reflect the realities of how digital assets are acquired and traded. The provision further makes clear that broker-to-broker reporting applies to all transfers of covered securities within the meaning of section 6045(g)(3), including digital assets”.
Cryptocurrencies: Breeding Ground for Tax Evasion
Cryptocurrencies are legal in the United States and many companies start accepting digital coins as a form of payment. And even though there’s an increasing number of various crypto tax software available in 2021, the government still fears that cryptocurrency holders cheat on their taxes. Cryptocurrencies are taxed as property and in an investigation conducted, the IRS noticed that only a small portion of virtual currency owners file their transactions.
Before the measures were agreed upon, Senator Rob Portman of Ohio already had concerns about tax requirements and crypto reporting.
With the new measures “digital assets are added to the current rules requiring businesses to report cash payments over $10,000.”
Kristin Smith, executive director of the Blockchain Association, explained that they will do everything in their power to change the measures. She also explains that the draft language used in the plan will most probably require a number of people dealing with crypto to start reporting their transactions. “We interpret this to mean software wallet developers, hardware wallet manufacturers, multisig service providers, liquidity providers, DAO token holders, and potentially even miners,” she said.